Most Popular
1. Banking Crisis is Stocks Bull Market Buying Opportunity - Nadeem_Walayat
2.The Crypto Signal for the Precious Metals Market - P_Radomski_CFA
3. One Possible Outcome to a New World Order - Raymond_Matison
4.Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun - Nadeem_Walayat
5. Apple AAPL Stock Trend and Earnings Analysis - Nadeem_Walayat
6.AI, Stocks, and Gold Stocks – Connected After All - P_Radomski_CFA
7.Stock Market CHEAT SHEET - - Nadeem_Walayat
8.US Debt Ceiling Crisis Smoke and Mirrors Circus - Nadeem_Walayat
9.Silver Price May Explode - Avi_Gilburt
10.More US Banks Could Collapse -- A Lot More- EWI
Last 7 days
Stock Market Volatility (VIX) - 25th Mar 24
Stock Market Investor Sentiment - 25th Mar 24
The Federal Reserve Didn't Do Anything But It Had Plenty to Say - 25th Mar 24
Stock Market Breadth - 24th Mar 24
Stock Market Margin Debt Indicator - 24th Mar 24
It’s Easy to Scream Stocks Bubble! - 24th Mar 24
Stocks: What to Make of All This Insider Selling- 24th Mar 24
Money Supply Continues To Fall, Economy Worsens – Investors Don’t Care - 24th Mar 24
Get an Edge in the Crypto Market with Order Flow - 24th Mar 24
US Presidential Election Cycle and Recessions - 18th Mar 24
US Recession Already Happened in 2022! - 18th Mar 24
AI can now remember everything you say - 18th Mar 24
Bitcoin Crypto Mania 2024 - MicroStrategy MSTR Blow off Top! - 14th Mar 24
Bitcoin Gravy Train Trend Forecast 2024 - 11th Mar 24
Gold and the Long-Term Inflation Cycle - 11th Mar 24
Fed’s Next Intertest Rate Move might not align with popular consensus - 11th Mar 24
Two Reasons The Fed Manipulates Interest Rates - 11th Mar 24
US Dollar Trend 2024 - 9th Mar 2024
The Bond Trade and Interest Rates - 9th Mar 2024
Investors Don’t Believe the Gold Rally, Still Prefer General Stocks - 9th Mar 2024
Paper Gold Vs. Real Gold: It's Important to Know the Difference - 9th Mar 2024
Stocks: What This "Record Extreme" Indicator May Be Signaling - 9th Mar 2024
My 3 Favorite Trade Setups - Elliott Wave Course - 9th Mar 2024
Bitcoin Crypto Bubble Mania! - 4th Mar 2024
US Interest Rates - When WIll the Fed Pivot - 1st Mar 2024
S&P Stock Market Real Earnings Yield - 29th Feb 2024
US Unemployment is a Fake Statistic - 29th Feb 2024
U.S. financial market’s “Weimar phase” impact to your fiat and digital assets - 29th Feb 2024
What a Breakdown in Silver Mining Stocks! What an Opportunity! - 29th Feb 2024
Why AI will Soon become SA - Synthetic Intelligence - The Machine Learning Megatrend - 29th Feb 2024
Keep Calm and Carry on Buying Quantum AI Tech Stocks - 19th Feb 24

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Gold in "New Bull Market Upward Phase"; Holds Key Highs vs. Dollar, Euros & Sterling

Commodities / Gold & Silver Sep 05, 2007 - 08:06 AM GMT

By: Adrian_Ash

Commodities

SPOT GOLD PRICES ticked lower during Asian trade on Wednesday, just dipping below $680 at the opening in Europe but recording the highest AM Fix in London since July 24th – nearly 0.9% above yesterday's start – at $679.50 per ounce.

Gold also held at yesterday's highs against the Euro and British Pound, but it slipped back from Tuesday's three-week high against the Yen, as the Japanese currency rose on the forex market.


"Many things are pointing in a positive direction for gold. The market is in a new upward phase," said one Tokyo analyst to Reuters earlier.

"Gold is drawing a lot of seasonal [Indian] demand now. Confidence remains in the market after seeing long-term funds stay in gold despite seeing the turmoil in financial markets."

"Funds seem to have renewed interest in gold now," agrees Ellison Chu, head of precious metals for Standard Bank in Hong Kong . "The prospect of a weakened Dollar might be a reason."

The US Dollar held steady early Wednesday, but interest rate futures continue to put the chance of a cut in the returns paid to Dollar savers at 100% when the Fed meets on Sept. 18th.

Further pressure on US interest rates came yesterday, when new data showed US construction spending falling 0.4% in July from June. Economists had expected no change. Today at 10:00 EST brings Pending Home Sales data for July, expected to show a 2% fall from June's 5% increase.

Before that, the ADP employment report at 08:15 EST will foreshadow the official US unemployment data due Friday. The Fed's monthly Beige Book of key statistics and analysis follows today's London close.

Already this morning, German and UK data releases have shown the service sector in both countries growing faster than forecast in Aug. But that news failed to prevent a 0.5% dip in Europe 's major equity indices, and it did little to reverse the Dollar's two-day rally against Euros and Sterling . They continued to trade below $1.36 and $2.01 respectively as growth in Eurozone retail sales was reported sharply below forecast for July, adding to speculation that the European Central Bank will choose to keep its interest rates on hold tomorrow.

In the gold market, The Euro Price of Gold held steady above €500 per ounce, after leaping to a 16-week high on Tuesday. For British investors wanting to Buy Gold Today , gold traded in a tight range around £338.50.

"[August delivered gold's] third highest monthly close ever," notes Christopher Langguth in today's TechniChris note for Mitsui. "In 1980 the January close was $681.50, $1 higher than April 2007."

The Gold Market ended last week at $672 versus the Dollar. It's since gained more than 1.5% against both Euros and Sterling .

"The immediate objective [now] is the recent high at $692.50," says Langguth, "followed by last year's high, $723. The Gold Price would have to fall below $640 to turn the monthly trend down."

Today in Tokyo , gold futures traded for delivery in Aug. '08 gained 0.7%, while the Nikkei stock-market average fell 1.6%, led lower by property shares. Reuters also points to aggressive sales of stock-index futures, as investors sought to square their positions before the first-half of Japan 's financial year ends on Sept. 30.

Over in India , gold sales to the jewelry sector – now enjoying its strongest season of the year – slowed dramatically after the overnight jump in New York prices. "Demand for gold has almost stopped," said Harshad Ajmera, head of J.J.Gold House in Kolkata to Reuters. "People expect a fall...They will wait for two to three days."

He says Indian buyers were looking for a pullback worth $4 per ounce from gold's current six-week highs.

"By most measures gold is now overbought, at least from a short-term perspective," says Phil Smith for Reuters India. "So it's not unreasonable to expect some consolidation from a technical standpoint."

By Adrian Ash
BullionVault.com

Gold price chart, no delay | Free Report: 5 Myths of the Gold Market
City correspondent for The Daily Reckoning in London and a regular contributor to MoneyWeek magazine, Adrian Ash is the editor of Gold News and head of research at www.BullionVault.com , giving you direct access to investment gold, vaulted in Zurich , on $3 spreads and 0.8% dealing fees.

(c) BullionVault 2007

Please Note: This article is to inform your thinking, not lead it. Only you can decide the best place for your money, and any decision you make will put your money at risk. Information or data included here may have already been overtaken by events – and must be verified elsewhere – should you choose to act on it.

Adrian Ash Archive

© 2005-2022 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in