[video] Gold Pops $20 on First Day of Trading in 2014
The video this transcript is based on appeared on January 2.
NEW YORK ( TheStreet) -- Gold prices pop more than $20 on the first trading day of 2014, following the worst year for the yellow metal since 1981. BullionVault Vice President Miguel Perez-Santalla tells TheStreet's Joe Deaux that gold's gain on Thursday likely came from traders who were absent through the holidays that returned to "cheap" gold.
Gold prices are starting off the year up twenty bucks, back above the twelve hundred dollar level. Here to talk about that with us today is Miguel Perez-Santalla, Miguel, thanks so much for being here.
Thank you for having me.
So Miguel, why do we see such a pop on the first day in 2014 after a difficult 2013?
Well, some people would say that the jobless claims number today which is a little lower than expected might indicate something to come. But I think more it's just bargain buying. I mean they walked in, they came in, they saw it was cheap. It started in Europe, they started this buying and it rallied up today.
Yes, a lot of people off for the holidays, they came back in and saw, "oh my goodness, gold is down below twelve hundred dollars an ounce." We still don't believe there's enough in the market to push it further below that, so people just came in and bought it thinking it was cheap.
And what about moving into 2014, that twelve hundred dollar level has really been a key level of support. We've tested it many times and we've not pushed through it. How long can it hold?
I think it can hold for quite a long time and in in fact the target cost on gold they say is mining costs around eleven hundred dollars, the big number that everyone's throwing around lately. And if you look basis that then you think a hundred dollar premium for them to profit on is reasonable. So people are seeing that below twelve hundred dollars is a good time to buy and we think that's where we're gonna see constant support. And then if you take into account the economic factors, that we still have quantitative easing going on that we have concerns about what are going to be the ramifications especially the US economy with Obamacare raising the cost of living for the middle class which is tremendous, which a lot of people are just now starting to see. What is going to happen - people are going to continue to go towards gold as a safe haven to protect themselves from the unknown.
Miguel as always thanks for coming in.
Thank you for having me.
For TheStreet I'm Joe Deaux.
Written by Joe Deaux in New York.
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