-- Posted Monday, 7 June 2010 | | Source: GoldSeek.com
"Again Asia held the gold price around Friday’s close, London then came in and took the price down $5, with the € dropping to hold below $1,20. This week will see the gold Fix in London dominate the market again. All other markets will follow. The morning Fix in London was $1,212.40 up from $1,203.5. $1,213 is the mid-point in gold’s trading range currently– watch that carefully! Silver is pointing south at $17.40. Budget cuts to attack sovereign debt could create an L-shaped recovery or a further downturn? The fall of just one European bank because of any government debt holdings will precipitate a crisis that will make the Lehman Bros crisis seem small.”
Gold - Very Short-term
As we said, Friday was the most ‘mobile’ days of last week. After being knocked down to big support, just above $1,190, the final hours of Wall Street saw it resurge back to $1,220 at the top of its trading range and ahead of this morning’s small decline. Clearly, its trading range is narrowing. We know that there is heavy turnover in the market currently. At some point soon buyers and sellers will be in balance and then? Which way? - Subscribe through: www.GoldForecaster.com and www.SilverForecaster.com
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We are a newsletter with a 95% correct record on the Gold & Silver Prices. [Gold Forecaster & Silver Forecaster newsletters will feature; “Gold – A Means of Exchange? - A Measure of Value?”, “What effect will high prices have on demand” and “What will high prices do to gold supplies” - Subscribe through www.GoldForecaster.com]. Some of these articles appear beyond the newsletter but key ones won’t!
Silver – Very Short-term
On Friday silver fell to $17.4 where it stands now. Did it break away from gold? Why didn’t it follow gold on Friday afternoon? If so is this permanent? We discuss this in the newsletter for you. Silver has followed gold for so long now that we need to know if this trend is changing. Watch its price carefully this week!
If it isn’t, then the silver price should run today, but will it? The troubles from the Eurozone are undermining confidence in currencies, leaving investors hunting for reliable alternatives. Is silver one of them? [Subscribe through www.SilverForecaster.com]
Gold Price Drivers
The call for deficit nations to cut budgets came from the G-20, but that was a given! As usual, the G-20 meeting, where some hoped they would hear plans of action that would rectify the problems the currency world faces, was underwhelming. It would appear that they cannot take actions that will alleviate these fears. We highly doubt that governments, with all their resources, could be in the dark about this. It would be naïve of us to think that was really their purpose in those meetings. National interests differ from global ones. Nations have their own interests. These follow completely different agendas to global ones, usually. Many times they do coincide, but you will not find cooperation unless they do. In the firing line at the moment is the global banking system, again. But this time it’s not the governments that will rescue the banks, but banks may well pay the ultimate price for government over-borrowing, this time round. This is not a short-term situation but will drag on for a long time. Which bank will be the first to find no chair to sit on in this game of musical chairs?
Consider the ‘new European environment; budget cuts, government job cuts, tax increases, and the rest, will deter growth investment if done well. This implies no growth or a further downturn. Superficial cuts will fool no-one and the problems will grow. It’s a case of “damned if you do and damned if you don’t.” Deflation has to threaten and the banking system won’t handle that and debt crisis reactions together.
Regards,
Julian D.W. Phillips – www.GoldForecaster.com
-- Posted Monday, 7 June 2010 | Digg This Article
| Source: GoldSeek.com
