Gold Gains as Investors Cash Out Bearish Bets; Investors Lock in Profits on Bets For Decline in Thinly Traded Market
Gold prices rose Friday, as investors locked in profits on bets for the precious metal's decline in a thinly traded market.</br></br>Gold for February delivery, the most actively traded contract, closed up $21.80, or 1.9%, at $1,195.30 a troy ounce on the Comex division of the New York Mercantile Exchange. It was the highest settlement since Dec. 19.</br></br>Prices for the precious metal are down 3% from December's highs, as a swiftly improving U.S. economy has raised concerns that the Federal Reserve will lift interest rates sooner than expected in 2015. Gold struggles to compete with yield-bearing investments when rates rise.</br></br>On Friday, some investors appeared to be buying gold to cover their bets on a decline in prices, while others were looking for bargains after the metal's drop, analysts said.</br></br>"Thin, postholiday trading conditions are likely exacerbating the bigger daily price move," said Jim Wyckoff, an analyst at Kitco.com, in a note to clients. "Many traders and investors have checked out for the week, if not for the rest of the year."