-- Posted Wednesday, 3 November 2010 | | Source: GoldSeek.com
The gold and silver market ignored the U.S. mid-term elections as the dollar sat at $1.403: 1€ in London ahead of the gold Fix at $1,358.5, fifty cents higher than before the election results started to come in. It was clear that the result came as no surprise to anybody.
Looking in from outside the impression given is that the current government will be emasculated. Will it be able to make decisions and implement them when needed? We see the result as bad for the U.S. economy because an excessive burden is being thrown onto the Fed, which just does not have the tools necessary to resolve the U.S.’s economic problems. The further outsider’s impression is that the Republicans and the Democrats will not have sufficient unity to handle the expected crises that lie ahead. All in all, the election results were gold and silver positive.
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Gold - Very Short-term
Ahead of the Fed’s announcement we expect gold and the dollar to continue to move sideways. Then expect a burst of activity. We expect little action until towards the second half of the week.
Silver – Very Short-term
Ahead of the Fed’s announcement we expect gold and the dollar to continue to move sideways. Then expect a burst of activity. We expect little action until towards the second half of the week.
Gold Price Drivers
For the next few days we expect the gold price to move in the opposite direction to the dollar, until markets feel that the overall realities of the negatives in the Eurozone and in the U.S. warrant moving away from this almost irrelevant exchange rate.
After all how can the financial situation in one against the other bloc dictate the gold price? Surely it should reflect the sum total of the both?
We are led to believe that it is only a matter of time before the Eurozone Sovereign Debt Crises suppurate again. With a ‘hung’ U.S. government we expect volatility and a lower dollar exchange rate. Can Mr. Bernanke change this? To us, the firm foundation that we need for a sound future has just received another gold and silver positive blow.
Regards,
Julian D.W. Phillips
-- Posted Wednesday, 3 November 2010 | Digg This Article
| Source: GoldSeek.com
