Mind the gap: Psychological barriers in gold and silver prices

Michael E. Lucey and Fergal O'Connor ()

Finance Research Letters, 2016, vol. 17, issue C, 135-140

Abstract: This study tests whether psychological barriers exist around key reference points in gold and silver prices, namely numbers ending in 0 (e.g. $450) and 00 (e.g. $200). Initial observations and tests show gold prices fix less frequently on values ending in 0 and 00, suggesting barriers at these levels which manifest as gaps in the frequency distributions. Statistical tests find support for barriers at numbers ending in 0 and 00 for gold. While initial observations and tests suggest silver prices are not uniformly distributed, there is no statistically significant evidence to support that barriers exist at either 0 or 00.

Keywords: Gold; Silver; Psychological barriers; Behavioral (search for similar items in EconPapers)
Date: 2016
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Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:17:y:2016:i:c:p:135-140

DOI: 10.1016/j.frl.2016.03.009

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