When the price of gold started to decline at the end of 2016, many investors decided that it was time to leave the precious metal alone. As these investors began dropping out of gold, the price declined even more. It seems likely that they might have missed their big break by being too jumpy. Of course, the only thing certain in the gold market is that it is uncertain.
Expect a Roller Coaster Year
If there is one thing that most experts agree on for 2017, it is that the year is going to be full of ups and downs. From there, you will find two very different thoughts regarding the price of gold. At the higher end, UBS predicts that gold will hit around $1,350 per ounce this year. At the lower end, ABN Amro predicts that gold will top out at around $1,131 per ounce. The difference between these two figures is considerable.
Events for Investors to Watch
In the short term, the inauguration of Donald Trump is the event to watch. There isn’t anything certain about how the market will react to Mr. Trump becoming President of the United States. On the day of his inauguration, investors should listen carefully to the speakers. Any clues about economic policy and other factors that could affect gold prices could prove valuable.
The Fed rate changes for the year will impact gold prices. Many industry analysts didn’t include three predicted interest rate hikes into their predictions. If all three of these happen, the dollar would be strengthened, which could push the price of gold down a bit.
The relationship between countries around the world might impact the price of gold. Many investors turn to the precious metal as the world becomes more volatile. Keeping an eye on Russia, the United States and the Middle East could provide important insight into the state of the world as a whole.
Other Considerations for Investors
Watching the gold chart carefully is going to be important for gold investors this year. For people who have already invested, being jumpy might cause a lot of trouble in 2017. For people who haven’t invested but are considering making a play in the gold market, expecting gold to plummet during the year is probably going to be a mistake.
Even though the market is going to be bumpy, and possibly tipping from bearish to bullish and back again, investors should be sure to think about how the current pricing plays into their portfolio goals.
