Friday, January 13, 2012

Gold price outlook Jan 16 2012, Fundamental Analysis

Gold price outlook Jan 16 2012, Fundamental Analysis : Gold prices declined on Friday as the USD gained strength after markets turned pessimistic on reports came out lately showing that S&P will move forward with euro area downgrades with French TV saying that the nation lost its top credit rating.

Knowing that investors moved towards low yielding assets with European stocks snapping the gains. The news reports suggested that Standard & Poor’s is set to downgrade the credit rating of several euro zone nations according to government sources, and that overshadowed the upbeat Uni. of Michigan Confidence index.

Now, eyes will be spotted on this year, and the performance of the European economy, especially after the ECB lent the European banks huge amount of money, and if that money will help the euro zone to continue recovery process amid big challenges.

Accordingly, we should expect more fluctuations for gold, but should the current pessimism persist, we should expect gold prices to extend the rallies, however, the level of uncertainty is very high, and investors are ought to remain cautious. Source
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