-- Posted Tuesday, 1 June 2010 | | Source: GoldSeek.com
With a weekend to digest the global financial situation, Asia began gold’s day by taking the price from $1,214 to $1,220. London then followed by taking the price up through $1,227, but the am Fix in London settled at $1,219.75. The upward pressure continued through to New York’s opening and a pm London Fix of $1,227.75. Prices then calmed slightly with prices settling at around $1,225 still in a robust condition.
Gold - Very Short-term
The € price of gold hit a new record of €1,009 today. Spain was downgraded on Friday increasing the pall over Europe. The markets continue to disbelieve governments and their future performance and can find expression in the gold price and other falling markets. This week will continue to reflect this view until there is something to convince them otherwise.
Another 14.4 tonnes of gold was sold in April by the I.M.F. after the sale of 18.5 tonnes in March. And yet the gold prices still rise. We believe that a large quantity of this finds its way to the central banks of Russia and China [in addition to its purchase of local production]. This is another factor confirming the presence of large institutional buyers seeking large volumes of gold at set prices. This type of buying at around these prices will continue until large volumes are no longer available.
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Silver – Very Short-term
Silver is slowly climbing with gold reaching $18.65 today, up 15 cents. It is riveted to the gold price at the moment, so expect the price pattern to mimic that of gold.
Gold Price Drivers
Major buyers, with a target of buying large tonnages of gold, are supporting the gold price at price levels that are steady and limited. They await offers of volume, which is why the London Fix will continue to dominate the daily gold price.
The mood in the markets is one of growing fear and doubt over governmental financial management. This will remain so until the steady attrition of confidence halts. With Spain facing a potential change of government and a general strike, because of the passing of austerity measures, uncertainty is still rising. With Spain a substantial economy, relative to Greece, this is very bad news for the € and good news for gold. Bear in mind that there is still Portugal, Ireland, the U.K. and the U.S. who have yet to convince markets that they are really solving their problems. This mood will persist.
With inflexible gold supplies and large available tonnages leaving the market, an imbalance is building up.
Regards,
Julian D.W. Phillips – www.GoldForecaster.com
-- Posted Tuesday, 1 June 2010 | Digg This Article
| Source: GoldSeek.com
