There has been a steady increase in the price of gold noted in the year 2016. A rise of almost $200 per ounce was witnessed in January. However, investors are not sure if this price can be sustained throughout the year. As far as trend goes, a steep rise in price is followed by a sharp decline, but as far as this year is concerned, things seem to be slightly different. So far, prices have not fallen drastically but seem to be hovering around the $1200 mark which could be an indicator of forthcoming increase in price.
A reason for this increase may be due to the fact that traders were encouraged by the hesitation on the U.S Federal Reserve’s part regarding a hike in rate of interest in the near future. Although this fact may not be set in stone, investors believe that rates may not rise until the final quarter of 2016. This along with stock market uncertainty, investors are rushing to purchase this precious metal such as the dominating players in the gold mining industry such as Newmont Mining Corp or Barrick Gold.
Gold holding its own on the spot gold chart is an encouraging sign. There may be an increased pressure in the future if stock markets remain volatile prompting investors to look to gold as safe haven as always.
The points to watch out for would be to see if gold will fall below $1200 which may set off alarms. Many are convinced that the price of gold would continue to increase. To cross $1300 is a huge encouraging sign and may lead to a lot of money being invested in gold.