In a continuance of the bull run over the last two weeks, gold opened up Monday morning at $1,277.37, $2.30 higher than Friday’s close. After pushing higher in early trading, the markets closed slightly up at $1,278.29. Tuesday opened with a pullback to $1,271.96 but the bulls started running early and the yellow metal surged to $1,280.74 at the close. In response to some vigorous afterhours trading, Wednesday opened near last week’s high at $1,287.19 but then saw a withdrawal to close at $1,278.59. Thursday’s market opened up more than $1 at $1,279.67 and, after some ups and downs during the trading day, closed slightly up at $1,279.94. Friday the gold markets really took off, however. After opening up $4.10 at $1,284.04, gold kept flying high to close at $1,292.43, up almost 1 percent on Thursday’s close, 1.2 percent on the Monday opening, the highest price thus far in November, and the highest since October 16, according to the gold spot price history chart. This was a spectacular week for gold.
The news last week started off with more trouble in Saudi Arabia. The Saudi government announced that a recent attempted missile strike at Riyadh airport could be an act of war by Iran, which sent jitters into commodities markets around the globe. Further upward pressure was put on the yellow metal as recent reports have showed that Turkish investor demand for gold is at a four-year high. 1 Wednesday brought technical analysis of the gold market: Mike McGlone of Bloomberg Intelligence reported that the metal is in a tight range similar to 2005, which indicates a massive upside to gold prices, especially if the dollar continues to decline and stock market volatility persists. 2
The final spur to get the gold bulls running last week however was the passage of the House Republican tax bill Thursday night. 3 While such an event would typically be expected to drive equities and the dollar higher and gold lower, euphoria from the passing of the bill gave way to worries about the gulf between House and Senate versions. Rumored disagreements on key issues such as corporate taxes, the permanent or temporary nature of the cuts, and incorporating a swipe at Obamacare were highlighted when the House bill finally passed. The economic uncertainty is driving a flight to quality, the dollar lower, and the precious complex to four-week highs.