December gold futures prices on the Comex division of the New York Mercantile Exchange settled at $1,747.20 an ounce, up 6.8 per cent on the week. Gold rallied to a high of $1,756 on Friday as participants started covering short positions when it crossed the $1,700 mark on Tuesday.
December gold, which recorded more than $100 gain on the week, is likely to see an increased profit-taking next week, market participants expect.
The trading volume in December on Friday, 95,707 contracts from an average of 149,614 contracts in the previous three sessions, indicate a cautious approach by traders at the higher levels.
The trading pattern in the most-active December gold contract on Friday and during the week ended October 28 suggested moderate fluctuation in the range of $1,723.50-1,758.50 next week. The volume-based overshoot could take the December futures around $1,784.
Trading in call and put options is hinting at a support below $1,710. Selling witnessed in the $1,750-strike December series call options at a premium of $40.
The $1,750-strike put saw sell-side bias at a premium of $53 per contract, as traders expect gold may not go substantially below $1,700; it will probably move up above $1,800 in the near future.
Nevertheless, Comex gold settled near the week's high, after investors sought the metal as a safe haven, although some profit-taking set in on Friday. Mike Daly, gold and silver specialist with PFGBEST says speculators and investors continued to choose both gold and silver as their safe-haven investment choice.
Participants in Kitco News' gold survey have a decidedly bullish bent for the next week, with a solid majority expecting higher prices for the yellow metal. In the survey, out of 26 participants, 19 see prices up, while five see prices down and two see prices sideways or unchanged.
A busy week is shaping up for the gold market next week, with several US economic reports set for release and a few central bank meetings to convene, a Bloomberg report said.
Market watchers will look to see if the recent strength of US economic data continues and if there are any hints out of the US Federal Reserve's monetary policy meeting.
Gold saw a strong rally this week, so traders will look to see if the market can hold its gains or if it will succumb to profit-taking.
