-- Posted Wednesday, 19 January 2011 | | Source: GoldSeek.com
Gold confirmed the turn upwards, but still within the current consolidation trading range. The dollar continues to visibly weaken, attacking the $1.35 level now against the euro, with other leading world currencies firmer against the dollar. We are of the belief that were practical central banks are aiming to keep exchange rates within a clearly defined trading range so that international trade is relatively stable. This will disguise the real market view on exchange rates spreading the falling confidence across the entire board of different currencies. For example the Swiss are very worried by their exchange rate and will move to intervene should it get much stronger. The same applies to the Japanese yen. With politicians procrastinating on increasing the rescue fund of the Eurozone we do expect them to wait until another crisis blows up before they act. This remains positive for gold.
Gold Fixed this morning at $1,373.75 up over $5, but fell slightly in the euro to €1,019.1. As New York came in it stood at $1,376 still well below the top of its trading range. Asia is remarkably consistent in its taking gold back up in price overnight.
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Gold - Very Short-term
Gold’s risk has lessened as it turned up into its trading range from support. We expect gold to continue consolidating with an upward bias. However, it continues to move to a point where we expect a strong move either way.
Silver – Very Short-term
Silver’s risk has lessened as it turned up into its trading range from support. We expect gold to continue consolidating with an upward bias. However, it continues to move to a point where we expect a strong move either way.
Gold Price Drivers
We are publishing an article on The U.S. & China going in opposite directions shortly. We will publish our thoughts on whether the Chinese will want gold in a reformed monetary system, but this will be for Subscribers only. As the Chinese Premier is entertained in a State visit to the U.S. we are of the opinion that China has arrived with force on the world scene as the way the U.S. is treating the Chinese Premier marks a significant change of attitude to China. This has made the future of the monetary system subject to considerable changes. The uncertainty that this promotes for the global economy is gold positive. Just think, if the Chinese either share or take the helm of the global economy what will the world look like in ten to twenty years? Where will the dollar and the euro stand then?
Gold sits in neutral ground in a battle for position by global currencies. We are issuing a series on “The Financial Earthquake” that lies ahead in the years to come, in our newsletters. We suggest you subscribe to the Gold Forecaster and Silver Forecaster where you can read these. It is there that we will we will detail all the factors that will join to jeopardize the global economic landscape in 2011, keep you in touch with their progress and give you our forecasts for 2011.
Regards,
Julian D.W. Phillips
-- Posted Wednesday, 19 January 2011 | Digg This Article
| Source: GoldSeek.com
