December Gold:  Open= 627.5  High= 631.2   Low=626.2   Close= 627.2   Change: -0.2

Again, another tight trading range left gold futures prices relatively unchanged for the fourth session in a row.  No momentum in either direction was supported as election results won’t trickle in until after hours trading.  Prices are likely to stay mixed to weak until results are better known or another story develops in the interim.  A price correction is not out of the question at this time and unfavorable election results could provide an impetus to take profits.  

By historically standards, this election should swing towards the Democrats.  Non-presidential elections tend to favor the party out of power.  Using averages, Republicans should lose 25 seats in the House and 6 in the Senate.  Pundits are calling the race now tighter than expected but it still appears that the Senate is the house of Congress that could fall to Democrats.  The prospect of congressional gridlock has its fans in the stock market, with an impressive two day rally leading up to the results.

A dramatic win by Democrats could be bullish for gold as the current party leadership exudes isolationism and protectionism.  Foreign buyers of the dollar may balk at this shift in power, sinking the dollar, thus raising the prospects of rising gold prices.  A victory by Republicans only holds the status quo and may influence a slight negative corrective action.  The Republicans have a more friendly tone towards foreign investors but have done little to spark enthusiasm of owning the dollar, thus keeping pressure downward on the dollar.

Gold is likely to continue its path higher, it’s just a matter of it correcting first or breaking solidly above $630.  Weakness should be bought at this time. Current conditions may warrant a retest of support at $620 and even as low as $610.  If prices rally and sustain prices above $630, prices could sprint to $650 before a correction comes.

Support comes in at $626, $620, $611. Resistance is seen at $630, $637, $640 and $650. 

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