-- Posted Thursday, 3 June 2010 | | Source: GoldSeek.com
"The trading range of this consolidation is narrowing. The London a.m. Fix was $1,219.75. Before New York opened gold was trading at $1,217.3. Banks in Europe are depositing record amounts at the E.C.B. giving the impression that they are afraid of lending to each other. If they are scared, who are we not to be?”
Gold - Very Short-term
Gold is holding in the upper end of its trading range at $1,220 and looking strong. This is major buying at its most effective! We believe today may see gold continuing to be strong. While on the surface all seems to be quiet, but the currents below the surface are on the move. The support in the market place is solid.
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Silver – Very Short-term
Holding at $18.35 silver is still cleaving to the gold price. The report in our latest Silver Forecaster on the situation in silver and our forecasts will give you direction for the long-term. [Subscribe through www.SilverForecaster.com] We repeat, “that this is the calm before the storm. It is still riveted to the gold price, so continue to expect the price pattern to mimic that of gold.”
Gold Price Drivers
Each day seems to have a piece of news that rattles our cages these days. Banks lodged €320.4 billion ($394 billion) in the European Central Bank’s overnight deposit facility at 0.25%, compared with €316.4 billion the previous day. This is a record level and a worrying one. Deposits have exceeded €300 billion for the past five days. It’s clear that the banks are worried that the ‘rescue plan’ for Greece and others and their ability to be rescued. These worries are making credit markets more difficult for the banks themselves. As we said yesterday, “with spreads widening in the LIBOR market and swap markets life is worrying for the financial system. It expresses tensions amongst banks and governments in the monetary system, so how can investors invest with confidence when they can’t?” The evidence is mounting again!
The slow transition of gold from a commodity [a barbarous relic] through it’s ‘rehabilitation’ to a key reserve asset, through to a measure of value is progressing quicker now. The time when currencies will be measured against gold and not gold measured against currencies, is coming.
To see gold in perspective, remember that gold has been consolidating long term [18 months] from $1,000 to $1,200 and is now holding above that level. Now?
Regards,
Julian D.W. Phillips – www.GoldForecaster.com
-- Posted Thursday, 3 June 2010 | Digg This Article
| Source: GoldSeek.com
