FXEmpire | December 24 2012 12:52 EST
Gold remained weak in early morning trading dipping by 2.25 to trade at 1657.85. Gold extended its losses after concluding its worse performance in 6 months last week.
The Fiscal Cliff issue is likely to remain the center of the markets next week too, as U.S. lawmakers wont vote on the end-of-year budget until after Christmas, giving them less than a week to reach agreement, after House Speaker John Boehner, a Republican, yielded to anti-tax resistance within his own party and scrapped a plan to allow higher tax rates on annual income above USD1 mn. Wall Street traders are going to have to pack their tablets and work computers in their holiday luggage after all. If something happens next week, it will come in a short time frame. Markets will be open for a half-day on Christmas Eve, while Congress will not be in session, and will close on Tuesday for Christmas. Wall Street will resume regular trading on Wednesday, but volume is expected to be light throughout the rest of the week with scores of market participants away on a holiday break.
Gold holdings of SPDR gold trust, the largest ETF backed by the precious metal, increased to 1,350.82 tons, as on Dec 21 as traders took advantage of low prices and the weaker US dollar. Silver holdings of ishares silver trust, the largest ETF backed by the metal, increased to 10,045.85 tons, as on Dec. 21.
Private investors in Switzerland, Austria and Germany are lining up to buy gold bars the size of a credit card that can easily be broken into one gram pieces and used as payment in an emergency.
With traders on holiday many have sold off profitable assets ahead of possible tax changes and many have moved to the safety of the US dollar abandoning risk assets as the AUD, NZD, JPY and CAD tumbled.
Last weeks break in gold prices, sees gold hanging on to meager yearly gains as it is about to enter the last few trading days of 2012, and for the short term market watchers are keeping an eye on Thursdays low. Prices were up on the day and down on the week. Gold on the Comex division of the Nymex settled at $1,660.10, down 2.17% on the week. March silver settled at $30.203 an ounce, down 6.5% on the week.
This week will feature light trade. Some markets are closed on Monday in Europe for Christmas Eve; Japan has a holiday on Monday, too. Most markets are closed on Tuesday for Christmas and some markets, including those in Canada, the U.K. and Australia, are closed Wednesday for Boxing Day.
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Originally posted here