JM Bullion Gold and Silver Market Update (12/16/16)


Gold Spot Price Open: $1,134

Gold Spot Price Close: $1,138

Change in Gold Spot Price: +$4

Silver Spot Price Open: $16.03

Silver Spot Price Close: $16.07

Change in Silver Spot Price: +$0.04

Despite the week resulting in a net loss for both gold and silver, Friday played host to a small recovery. When all was said and done, gold managed to gain about 6 dollars while silver added more or less 4 cents. Platinum and palladium saw different days altogether. Platinum gained back nearly 40 dollars while palladium ended the day in more or less the same position it was in when things began.

US Dollar Rally Pauses

Throughout this whole week, and especially in the wake of the FOMC meeting, the USD Index has been moving steadily upward. Friday saw that theme end as profit-taking after major gains entered the picture. Though most investors are still very optimistic about what the near-term future has in store for the greenback, today was a day for other investors to cash in on gains made over the past two weeks or so.

As you could have probably guessed, the Dollar backing off a bit gave precious metals a little room to move forward. While some investors are cashing in on the USD’s recent progress, we are seeing the opposite happen to gold and silver. Thanks to recent losses—most notably the massive losses suffered yesterday—we are seeing an uptick in the number of bargain-hunters looking to take advantage of spot values that are the lowest they have been in years. As is typically the case when bargain-hunting comes into play, any gains made today are likely to be temporary in nature. The reason for this is due to the fact that there are so many bearish factors throughout the global marketplace that gold and silver are not extremely desirable investments right now. Instead, investors are feeling comfortable taking risks with equities and currencies.

Outside Markets Help Metals

In recent days, weeks, and months, when we have talked about outside markets involving equities and currencies, we have usually coupled that discussion with how progress there has impeded progress on the part of precious metals. Today, for the first time in a long time, we are talking about exactly the opposite. As was mentioned above, the US Dollar is pulling back today, and so too are most US equity markets. Typically, when we see these two posting losses, we will typically see gold and silver moving upward. That is exactly what happened today. With that being said, it is highly likely that any gains realized today will be temporary in nature.

As we move forward and further into the month of December and ultimately the New Year, expect the focus on economic data to pick back up. Now that the FOMC debacle is behind us, the scope of observed economic data will broaden. It was no secret that the past few months saw investors almost solely focus on US economic data. Going forward, we will be taking European and Asian data into consideration more frequently. For gold and silver, it is tough to say whether this will be a good or a bad thing.

Another focal point for investors will be Donald Trump, as he is only weeks away from officially assuming the position of President of the United States. It is widely believed that he will be great for US businesses and, thus, US stocks, and if this proves to be true gold and silver may have a long, tough road ahead of them. With that being said, however, this is pure speculation at this point. We will just have to wait and see what the President-elect does once he actually assumes office.


When all was said and done on Friday, gold and silver did post some solid gains, but those gains are coupled with the expectation that they will be given back before too long. As we look ahead to next week, you can expect a mostly quiet marketplace as investors move away from the markets in order to spend time with friends and family in the lead-up to the Christmas holiday, which takes place next Sunday.

All Market Updates are provided as a third party analysis and do not necessarily reflect the explicit views of JM Bullion Inc. and should not be construed as financial advice.