The Silver lining – Silver and Gold prices went down– weekly recap Dec 12

Here is your weekly recap of the changes in Spot Gold price and Silver prices for the week of December 6th to 10th:

After a couple of weeks of precious metals showing a steady rise, particularly in Silver prices, this passing week showed that even Gold and Silver could decline as investors curb their enthusiasm…

At the end of the week, the spot Gold prices fell by 2.2% from the beginning to the end of the week, however this week’s average price was 1,397 USD /t. oz – a 0.7% rise compare to last week’s average weekly price of 1,387 USD /t. oz.

The same could be said for silver prices, only that silver showed more volatility as it fell by 3.8% from the beginning to the end of the week, and, like gold, also rose by 2.5% from this week’s average weekly price of 29.04$/t oz., compare to 28.33$/t oz.

On average, gold prices declined by 0.3% every day of the week, while silver prices fell by 0.43% on a daily average.

In the following table I present a summary of last week’s descriptive stats of gold prices and silver prices:

table current current gold prices and silver prices - 6-10.12*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


After the bullish rise from the previous week, it seems that sanity returned to the market as Silver and Gold cooled down a bit.

There are some economic considerations for the increases in the past year, as the world consumption of gold, is on the rise and the total demand for gold rose in 2010 compared to 2009. OK, so even given the rise in demand for gold which is mainly originates in India and China, this means that most of the rise is still due to investors speculate about gold spot price continue to rise and that gold will prove to be a good investment.

As long as the investors will see the ongoing risk in investing in the US economy, and   many other European countries it’s reasonable to assume that these economies will affect investors to fall back on major commodities to invest in, such as silver and gold.

This passing week it seems that investors show that perhaps gold and silver rose too much too quickly, and in particular silver touching the 30 USD mark was perhaps a mental barrier…

Furthermore, there is an apparent uncertainty behavior of investors as the Euro and USD didn’t show any apparent trend from this passing week with the EURO/USD starting the week at 1.3261, and by the end of the week settling at 1.3226.

Gold and silver has proven to be very strong commodities, and silver even more then gold has many more industrial applications; thus, we will probably continue to see them rising in the short term, however if I would speculate, I think that there will be a decline, at least in Gold prices eventually in the long term because gold demand doesn’t rise as much as its prices did, however when will this change happen remains to be seen.

I have added a chart in which gold prices and silver prices are presented as follows: the price of each commodity is normalized to 100 for the price as of 6th of December – the beginning of the week.

price of gold chart and silver prices chart 6-10.12

In the final graph you can see the daily percent change of these precious metals for last week. According to the graph the Silver prices fluctuated throughout the week between 2% and -5%, while the Gold prices only changed between 0.7% and -1.8%, demonstrating less volatility compare to silver prices.

price of gold chart and silver prices chart 6-10.12 percent change

For further reading: