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Gold Ends Firmer as Choppy, Sideways Trade and Summertime Doldrums Continue

SOURCE:[Forbes] - Comex gold futures prices ended the U.S. day session modestly higher Wednesday. It was yet another quiet, summertime trading day. The market place is awaiting some fresh, market-moving fundamental inputs. But with the dog days of summer at hand in the U.S. and most of Europe on vacation, that news has been hard to come by lately. Several U.S. economic reports released Wednesday failed to significantly impact the precious metals. December gold last traded up $4.00 at $1,606.40 an ounce. Spot gold was last quoted up $5.00 an ounce at $1,604.50.  September Comex silver last traded up $0.022 at $27.785 an ounce.

Many market participants are also on the sidelines, or are tentative, as they wait to see if the U.S. Federal Reserve will act to implement another round of quantitative easing of U.S. monetary policy—nicknamed QE3. Any such action could occur at the Fed’s Jackson Hole, Wyoming annual gathering in late-August, or at the next meeting of the Fed’s Federal Open Market Committee in September.

Reports overnight said major investors George Soros and John Paulson have significantly increased their holdings in the largest gold-backed exchange traded fund, SPDR Gold Trust. These two heavyweights are considered the “smart money” in the market place, and it appears they are doing some bargain-hunting shopping and looking for gold prices to appreciate in the coming months.

The U.S. dollar index was higher Wednesday, which limited buying interest in the precious metals. The greenback is seeing choppy trading action recently, but the bulls maintain the solid overall near-term technical advantage. Meantime, crude oil prices were also higher Wednesday, and that was supportive for the metals. Oil bulls still have a bit of upside near-term technical momentum on their side. The precious metals markets will continue to look closely at how these two key “outside markets” trade on a daily basis.

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