This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Topsy-turvy Week For Gold

Topsy-turvy Week for GoldGold this week was buffeted by winds coming from both Europe and the United States — with the end result being that most of its gains were wiped out and the price of the precious metal finished Thursday at almost the exact level as a week earlier. 

The action started on Monday when bargain hunters — still seeing blood in the water from last week's 20 percent price pullback due to signals from the US Fed about a possible end to quantitative easing — jumped into the bullion markets. A weaker dollar and the prospect of bad news coming out of Italian elections also helped gold. The gold price added more than $25 and came close to breaching the psychologically significant $1,600 level — rising over 1 percent to $1,593 per ounce.

Then it was Ben Bernanke's turn to weigh in on quantitative easing — a term first coined in 2008 when the central bank began purchasing bonds in an effort to shore up the flagging US economy. Since that year the gold price has doubled on the inflationary implications of QE and its latest round, QE3 announced last year, involves the purchase of some $85 billion per month worth of US Treasuries and bonds.

On Tuesday the US Federal Reserve chairman tried to assuage concerns about QE ending, stating "In the current economic environment, the benefits of asset purchases […] are clear.” Bernanke indicated that QE could stay in place until 2014 and added that "monetary policy is providing important support to the recovery while keeping inflation close to the FOMC's 2% objective.”

Those remarks were bullish for the gold price, which gained more than $30 to reach a high of $1,620.

The rally wasn't to last, however, after positive economic news from the United States on Wednesday dampened the spirits of gold bugs and traders began hitting their sell buttons. Housing data turned out better than expected and that had investors thinking the Fed's ultra-loose monetary policy could end sooner rather than later despite Bernanke's comments to the contrary. Gold fell as much as $25 to touch a low of $1,591, erasing most of the gains made the day earlier.

1 of 4

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,138.85 +6.88 0.04%
S&P 500 1,999.41 +0.43 0.02%
NASDAQ 4,558.6440 +5.8850 0.13%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs