-- Posted Tuesday, 17 May 2011 | | Disqus
Since Thursday of last week the dollar has barely changed, standing at €1: $1.4156 up from €1: $1.4162. The gold price has changed and ahead of London’s Fix of this morning stands at $1,493.75. In the euro it stands at €1,055.21 up €5 on the weekend. We are just under resistance in the euro price, whose high was €1.065, but it has been nudging this for over a week now.
At the Fix in London gold was set at $1,495.50 and in the euro at €1,051.54 with the dollar standing at €1: $1.4165.
Ahead of New York’s opening the gold price in the dollar stood at $1,492.75 and in the euro at €1,053.76 and the dollar stood at €1: $1.4166.
Silver rose on the day to $34.08 up 17cents on yesterday. Silver is still, no place for widows and orphans.
Gold - Very Short-term
The dollar continues to dominate the dollar gold price. Euro gold prices will hold at current level or show a slightly positive bias today, in New York.
Silver – Very Short-term
The dollar continues to dominate the dollar silver price plus some. Euro gold prices will hold at current level or show a slightly positive bias today, in New York. Allow for greater swings in silver than in gold.
Silver & Gold Price Drivers
Since the start of the ‘fall’ in precious metal prices or should we say the ‘rally’ in the dollar, the media has portrayed the volatility most markets have been through as dealing in those markets. What in fact has happened is that a form of ‘arbitrage’ [dealing between two markets] has happened as dollar prices were adjusted in the light of the dollar rally. A look at the volumes traded in those markets has been consistent with small quantities of physical gold and silver being moved. George Soros exited from his around 16 tonnes of gold ahead of its fall and his expectation of a dollar rally. He did well, but we believe that there is still a decade or more of a reinstatement of gold to a position it held as real money. He sold at a profit, which is not what the bulk of today’s gold investors do today. They may well be sellers, if the U.S. dollar provides a better investment as financial security and as global money. You have to ask yourself, “Will it?” Please note that the day we are asking this question is the day that the U.S. breached its $14.3 trillion debt ceiling.
Silver prices are considerably more volatile than gold prices and do not track the dollar: euro changes. With the silver market hub in the Americas, it is not surprising that they come under a more volatile influence. We do expect this to continue in the future, but we also continue to expect silver to move with gold in a more extreme manner than gold on both the upside as well as the downside.
We are issuing the full versions of the articles “Will gold and silver prices fall when interest rates rise?” in the next issue of the Gold Forecaster and the Silver Forecaster.
Portugal is to receive its bailout now agreed. Greece needs another one. It is now probably not going to “re-structure” but to re-profile [no reduction in repayment but creditors will have to wait longer before payout]. The crisis is far from over!
We cover the implications for gold in macro-economic and currency events in all the issues of the Gold Forecaster and the Silver Forecaster for subscribers. [The Gold Forecaster and Silver Forecaster are a “must-read” for all who want to understand why the gold and silver prices are moving as they are and why.] Subscribe at www.GoldForecaster.com or for silver at www.SilverForecaster.com].
Regards,
Julian D.W. Phillips for the Gold & Silver Forecasters
-- Posted Tuesday, 17 May 2011 | Digg This Article
| Source: GoldSeek.com
