-- Posted Tuesday, 11 October 2011 | | Disqus
After New York closed higher, Asia took the gold price all the way to resistance at $1,680 before London pulled it back down to $1,657 ahead of the Fix in London. The euro continued strong at 1€: $1.36oo at the time before slipping only slightly to €1: $1.3593 after London opened. Gold then Fixed at $1,662.00 and in the euro at €1,222.958 while the euro stood at €1: $1.3616.
Later in London’s morning and ahead of New York’s opening, gold rose more to $1,662.70 and in the euro to €1,222.21 while the euro was at €1: $1.3616.
The silver price started the day at over $31.64, 30 cents down on yesterday, before rising slightly to $31.63 ahead of New York’s opening.
Gold (very short-term)
The gold price should continue to consolidate with a negative bias, today in New York.
Silver (very short-term)
The silver price should continue to consolidate with a negative bias, in New York, today.
Price Drivers
The market has decided to take a very positive view of the ‘Merkozy’ promise to produce a bank re-capitalization plan for European banks. After the rescue of Dexia bank by France and Belgium with state billions it is clear on both sides of the Atlantic that the government and central banks way forward will be to produce new money, no matter what effect this will have on its value. After all, deflation destroys economies, inflation, at first, only destroys money.
No market just goes one way. Every market moves, to some extent, both up and down, like the waves of the sea. And we are seeing that in all markets as hopes rise then hopes fade. The gold market is benefitting from that as well now as it continues to consolidate. In those consolidations it gives slight indications of the direction it will go next. For us to understand the direction of gold and silver we have to note what indications we are being given by the price movements. The London Fix is dominating the market now, showing physical demand on top. With the gold price holding $1,662 for a couple of days now a large move may be due, either way dominated by physical demand.
More importantly, we are going to have to decide what type of ‘flation’ we are going to enjoy in the future, ‘stagflation’, ‘inflation’ or ‘deflation’. Some believe that deflation will rule in 2012 after defeating the main central banks attempts to swamp the system with new money. Some believe they will not let this happen through the continued efforts to reflate with new money. The recovery may not be dead, but how alive it is remains to be seen. We would suggest that investors focus on the state of money circulation, not its velocity or quantity. We included an article on this in the latest issue of our newsletters. So, please subscribe through www.GoldForecaster.com or www.SilverForecaster.com to them to benefit from this insight.
This week, in the next issues of our newsletters, we are focusing on the investor and will look at the principles behind the decisions shaping precious metal portfolios.
Regards,
Julian D.W. Phillips for the Gold & Silver Forecasters
Gold Prices to Highlight Currency Moves |
| Today | 1 day ago |
Franc | Sf1,511.89: 1 oz. of gold | Sf1,506.64: 1 oz. of gold |
US | $1,662.70: 1 oz. of gold | $1,664.80: 1 oz. of gold |
EU | 1,222.21: 1 oz. of gold | €1,222.68: 1 oz. of gold |
India | Rs.82,045.93: 1 oz. of gold | Rs.81,666.76: 1 oz. of gold |
-- Posted Tuesday, 11 October 2011 | Digg This Article
| Source: GoldSeek.com
