Gold looks poised to snap December win streak this year

Gold is down 1.3% on the month and the decline this month largely stems from a more hawkish Fed from last week. Barring a stirring rally in the coming week or so, gold looks poised to snap its seven year win streak in December in 2024 trading.

In the past decade, December is the second best month for gold behind the usual January rush. The latter has been a bit mixed in recent years but December has proven to be quite a consistent trend. That is up until now I guess.

The difference this year for gold is that it has observed nine straight months of gains prior to November. It is quite an unprecedented run as seen with the monthly changes above. And even with the recent decline in the past two months, it is still up nearly 27% this year. That puts gold on course for its best performing year since 2010.

So, one can argue that the consistent hot streak this year sort of takes away from usual buying rush in December and perhaps next month in January. That especially with conditions lining up for some profit-taking amid a more hawkish Fed and some technical obstacles.

For now, gold is moving back up above its 100-day moving average of $2,609 as it trades at around $2,617 currently. That’s a key line in the sand to watch in the weeks ahead after the recent double top at the 25 November high of $2,721.

If sellers can push the boundaries to hold a break below the key level, that will set the foundations for another potential break of the seasonal indicator when we get to January trading.

This article was written by Justin Low at www.forexlive.com.