Gold and silver made some decent gains today thanks to a large amount of bargain-hunting buying. While the rest of the week is expected to pick up with regard to economic data, investors are enjoying today’s respite as today was the first day in a while where gold and silver didn’t post losses.
Moving forward into the latter stages investors are anticipating a few bits of economic data out of the US. Included in this economic data is the latest US jobs figures as well as tomorrow’s GDP report.
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Apart from the release of the Federal Reserve’s beige book today, the ADP national employment report for November was also released. Much to the marketplace’s surprise, this employment report came in much stronger than the market had expected. Despite the report’s strong reading, however, bargain-hunters were buying up so much gold and silver that even the downward pressure placed on precious metals was not enough to force losses. Instead, gold and silver reclaimed most of the losses they recorded on Tuesday.
While today was a nice bit of respite from recently dismal runs by both gold and silver, do not expect the positive gains to continue. So long as the rest of this week’s economic data comes in strong, which it is expected to, gold and silver will likely be subject to the wrath of market bears.
Adding to that, if the next few days’ worth of economic data beats market expectations, the notion that QE might be tapered before the end of the year will gain strength. Currently, the world marketplace is obsessing over the timing of QE’s tapering and many think that this month’s FOMC meeting is when the tapering will be put into action. There is no real way of finding out whether QE will be tapered or not though, so we will just have to analyze US economic data and patiently wait until the 16th-18th of December, when the FOMC meeting is scheduled to take place.