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Not only did the gold price manage to stay above the $1,300 resistance level last week, but the metal surely and steadily climbed even higher. From Friday, Sept. 1, to Friday, Sept. 8, the price of gold gained 1.6% to $1,351.
Gold was clearly buoyed by the U.S. dollar's plunge to a nearly three-year low. The U.S. Dollar Index (DXY) – which measures the greenback against other currencies like the yen and the euro – dropped from 92.81 to 91.33 last week. That was the lowest since December 2014.
But North Korea's testing of a hydrogen bomb – considered the country's most powerful to date – on Sunday, Sept. 3, sent gold prices higher. On Tuesday, Sept. 5, the price of gold jumped 1.1% to $1,345.
Despite falling since then to $1,339 today (Monday, Sept. 11), gold is now up 16.2% in 2017, easily beating the S&P 500's 10.9% gain since then.
Some indicators are starting to place the metal in overbought territory. While this could lead to a brief dip, I remain bullish on gold in the medium and longer terms. Today, I'm going to share with you my bullish gold price target for the end of 2017.
First, let's look at gold's 1.6% rise last week…
Gold Price Gains 1.6% Last Week (Sept. 1-8)
After settling at $1,330 on Friday, Sept. 1, the metal opened higher following Labor Day and North Korea's hydrogen bomb test. The news urged investors to sell their stocks and move into safe-haven gold on Tuesday, dragging the Dow Jones 1% on the day and boosting the gold price 1.1% to $1,345.
On Wednesday, Sept. 6, the price of gold opened lower at $1,339. It moved sideways at that level throughout the day as the DXY was also mostly flat. Gold prices closed the session at the opening level of $1,339 – 0.4% down from Tuesday's close.
Here's a look at the DXY's performance last week…
But gold prices rebounded on Thursday, as the dollar sold off from 92.29 to 91.66. Gold climbed steadily throughout the session to eventually settle at $1,350 for a 0.8% gain.
Friday was marked by record closes for both the gold price and DXY…
After opening lower, the dollar stayed below the previous close the entire day and eventually settled at 91.33 – the lowest since December 2014.
Meanwhile, the price of gold gained 0.1% on the day to close at a one-year high of $1,351. With that, gold logged a weekly gain of 1.6%.
Urgent: Executive Editor Bill Patalon just saw something on his precious metals charts he's only seen twice in 20 years. He calls it the "Halley's Comet of investing" – and it could lead to windfall profits. Read more…
The gold price today is down 0.9%, to $1,339, from Friday's one-year high. This is due to a 25 basis-point rebound in the DXY, which hovers near 91.72 right now.
While we can never tell what North Korea will do next, one factor that will continue to be fundamentally important for gold is the dollar. With the greenback down near a three-year low, the dollar's movement from now until the end of the year will play a large role in my gold price forecast for the rest of 2017.
Here's where I see gold heading in the near and long term…
These Are My 2017 Gold Price Targets
About the Author
Peter Krauth is the Resource Specialist for Money Map Press and has contributed some of the most popular and highly regarded investing articles on Money Morning. Peter is headquartered in resource-rich Canada, but he travels around the world to dig up the very best profit opportunity, whether it's in gold, silver, oil, coal, or even potash.