-- Posted Friday, 17 February 2012 | | Disqus

New York took the gold price back up to $1,728.4 and Asia lifted it even higher to $1,732 ahead of London’s opening. London held it at that level and took the euro. The euro opened in London at €1: $1.3158 up 1% on yesterday. Gold held steady €1,316.31 only slightly down on yesterday. In London, gold Fixed at $1,732 up $16.00 and in the euro at €1,316.510 down €4. The euro held at €1: $1.3152 ahead of New York’s opening and gold held at $1,731 while the euro was slipping again to €1: $1.3131 leaving the euro gold price at €1,318.26 down €3 on yesterday.

Silver moved with gold and opened in London at $33.52 40 cents up. Ahead of New York’s opening it stood at $33.50.

Gold _{(very short-term)}

Gold will show a weaker bias in New York today.

Silver _{(very short-term)}

Silver will move with gold but show a steady bias, in New York today.

Price Drivers

Gold is moving entirely alongside the euro, but with a rising tendency against the euro. As the euro moves against the dollar, we have to add that move to that in the euro to understand the gold price moves in the dollar. Again, we see the move in gold properly reflected only in the euro and not the dollar. Why you may well ask? The developed markets are in the developed world. Gold is priced at the Fix in London in the euro, the pound sterling and the U.S. dollar. Buyers are free to choose one of these three currencies to settle in. This is where 90% of the physical gold market comes to. As buyers come from all over the world, but work through bankers and brokers, it may be that price moves are most accurately reflected in the currencies the brokers or banks choose as they may have converted client’s funds prior to their settling of purchases. Right now it appears that the euro is the favored currency for this, not the dollar, but it can change.

More importantly, with gold’s moves being seen most accurately in the euro and not the dollar, either this is where demand is coming from or it is the currency of choice among gold dealing banks. If the euro is the currency of choice, we ask why?  The public perception is that the U.S. dollar is the currency that gold is priced in, but because this price reflects the euro’s moves first, then the gold price’s moves, this is no longer the case.  [To get more of the right perspectives on the gold and silver markets and where gold and silver prices are going, subscribe through www.GoldForecaster.com or www.SilverForecaster.com]. 

In the latest debt crisis moves, the E.C.B. is going to be exempted from a Greek haircut, make a profit on the bonds, then hand the profit back to Greece to help lower its debt. This is a wise handout. But creditors who are back-ranked and have to take a swimmer’s haircut won’t be happy. Next week may well see creditors enter the barber’s shop!

Regards,

Julian D.W. Phillips for the Gold & Silver Forecasters

-- Posted Friday, 17 February 2012 | Digg This Article | Source: GoldSeek.com

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