-- Posted Friday, 30 September 2011 | | Disqus

Gold again recovered back into the $1,620 area, before London again helped it over the $1,630 level.   The euro started the day weakening after just a small dose of relief provided by German approval of a bigger, but insufficient ‘bailout fund’.   The euro stood at €1: $1.3532 at the time leaving gold trading in the euro at €1,203.19. The gold price held steady thereafter and Fixed at $1,629.00 and in the euro at €1,204.26 with the euro, at the time, standing at $1.3527.

After the Fix and ahead of New York’s opening it stood at $1,629.60 and the euro at €1: $1.3523 with euro gold at €1,205.06.  

The silver price started the day just over $30 but rose ahead of New York’s opening to $31.05.

Gold _{(very short-term)}

The gold price should continue volatile to stronger today in New York.

Silver _{(very short-term)}

The silver price should continue volatile to stronger in New York, today.

Price Drivers

With the Eurozone bailout package almost doubled in size to cope with Greece, Ireland and maybe Portugal, to €over400 billion, the markets smiled at first, but then sank back into trepidation as the Italian government had to pay the highest interest ever for funds at yesterday’s auction.   This tells us that the concept of ‘contagion’ is moving from probable to reality now.   We are producing articles on; “”On the brink…” and “A different kind of Inflation coming”, which we feel are particularly pertinent as we face this developing situation.

When markets keep on being disappointed it signals something far more than just a temporary correction.   As markets just dip slightly it is becoming clear that they are in a sort of denial, actually waiting for something to trigger what we are expecting at any time.  

How is this driving gold, you may well ask as we see it sitting not far off $1,600 after having fallen from a peak of over $1,9oo? Well, look at the funds that hold physical gold.   They have barely fallen. Look at the demand from Asia.   It is coming in at the lower levels as it has done in the past after a fall.   But this fall is far more significant than we have seen in the past you may say.   We look back at when speculators and the banks drove gold from $300 to $390, then all the way back to $326 in 2005 and saw that short-term traders can, under the right market conditions drive prices a long way.   In the recent case as in 2008, ‘Investor Meltdown” created conditions where covering margins, triggered ‘stop loss’ protections and the search for liquidity allowed for the precipitous falls.   But was that a change in trend, you have to ask yourself? Have gold and silver market conditions changed fundamentally is the next question? We are looking at this prospective future in the next issues of the Gold Forecaster and the Silver Forecaster where you can get a more complete perspective on gold and silver so subscribe now!

-- Posted Friday, 30 September 2011 | Digg This Article

© 1995 - 2019

Live GoldSeek Visitor Map | Disclaimer