Here is your weekly recap of the changes in Gold prices and Silver prices for the week of November 22nd to 26th:
This week the market of precious metals started with a rise and ended in a fall. The fall was I particular true for Silver price, as the short term silver futures declined on November 26th by 3 percent compare the previous business day, ending the week with a week low price of 26.77$/t oz.
Forgold prices, there is a similar trend only more moderate, as spot gold price dropped on the last business day by 0.78%, ending the week at 1,364.3 USD /t. oz. Nonetheless, the average price of 1,370 USD /t. oz this week rose by 1.5% compare to the average price of 1,349 USD /t. oz from the previous week.
Analysis:
It’s obvious that there is a long term trend, in which most precious metals are rising. This is truer as the economic uncertainty rises and risk adverse investors fall back on gold and silver as a less risky investment.
There is also industrial and electronic usage for gold and silver, and thus as major economies progress these commodities increase in their value.
Using this logic, we could interpret the recent fall of gold and silver prices during the end of the week due to the news, which I have referred to in a recent post, about the US showing some strength in its economy. This news could be the cause for investors substituting their position in gold and silver to the US economy’s treasury bonds, causing gold and silver prices to fall.
Others might consider speculation around a decline in consumption of gold and silver as a reason to their prices declining, in particular, the news regarding China slow downing its economy which could, consequentially, lead to less gold and silver consumed.
Nevertheless, no matter which interpretation you might prefer for the recent fall of gold and silver prices, I think that it’s less speculative to say that the dramatic rise in these metals isn’t over especially since no news were that dramatic to cause a shift in this five year inclination.
Getting back to this week data analysis…
In the following table I present a summary of last week’s descriptive stats of gold prices and silver prices:
*This figure is calculated based on the percent change from the price at the beginning of the week compare to the price at the end of the week.
I have also added a graph in which gold prices and silver prices are normalized in the following way: the price of each commodity is normalized to 100 for the price as of 22nd of November – the beginning of the week.
In the final graph you can see the daily percent change of these precious metals for last week. According to the graph, silver prices fluctuated throughout the week between -3% and 1%, while spot gold price only changed between -0.78% and 1.6%, demonstrating gold being volatile than silver prices.
