Best of the Week
Most Popular
1. Investing in a Bubble Mania Stock Market Trending Towards Financial Crisis 2.0 CRASH! - 9th Sep 21
2.Tech Stocks Bubble Valuations 2000 vs 2021 - 25th Sep 21
3.Stock Market FOMO Going into Crash Season - 8th Oct 21
4.Stock Market FOMO Hits September Brick Wall - Evergrande China's Lehman's Moment - 22nd Sep 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
7.AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
8.Why Silver Price Could Crash by 20%! - 5th Oct 21
9.Powell: Inflation Might Not Be Transitory, After All - 3rd Oct 21
10.Global Stock Markets Topped 60 Days Before the US Stocks Peaked - 23rd Sep 21
Last 7 days
Stock Market Investing LESSON - Buying Value - 27th Nov 21
Corsair MP600 NVME M.2 SSD 66% Performance Loss After 6 Months of Use - Benchmark Tests - 27th Nov 21
Stock Maket Trading Lesson - How to REALLY Trade Markets - 26th Nov 21
SILVER Price Trend Analysis - 26th Nov 21
Federal Reserve Asks Americans to Eat Soy “Meat” for Thanksgiving - 26th Nov 21
Is the S&P 500 Topping or Just Consolidating? - 26th Nov 21
Is a Bigger Drop in Gold Price Just Around the Corner? - 26th Nov 21
Financial Stocks ETF Sector XLF Pullback Sets Up A New $43.60 Upside Target - 26th Nov 21
A Couple of Things to Think About Before Buying Shares - 25th Nov 21
UK Best Fixed Rate Tariff Deal is to NOT FIX Gas and Electric Energy Tariffs During Winter 2021-22 - 25th Nov 21
Stock Market Begins it's Year End Seasonal Santa Rally - 24th Nov 21
How Silver Can Conquer $50+ in 2022 - 24th Nov 21
Stock Market Betting on Hawkish Fed - 24th Nov 21
Stock Market Elliott Wave Trend Forecast - 24th Nov 21
Your once-a-year All-Access Financial Markets Analysis Pass - 24th Nov 21
Did Zillow’s $300 million flop prove me wrong? - 24th Nov 21
Now Malaysian Drivers Renew Their Kurnia Car Insurance Online With Fincrew.my - 24th Nov 21
Gold / Silver Ratio - 23rd Nov 21
Stock Market Sentiment Speaks: Can We Get To 5500SPX In 2022? But 4440SPX Comes First - 23rd Nov 21
A Month-to-month breakdown of how Much Money Individuals are Spending on Stocks - 23rd Nov 21
S&P 500: Rallying Tech Stocks vs. Plummeting Oil Stocks - 23rd Nov 21
Like the Latest Bond Flick, the US Dollar Has No Time to Die - 23rd Nov 21
Why BITCOIN NEW ALL TIME HIGH Changes EVERYTHING! - 22nd Nov 21
Cannabis ETF MJ Basing & Volatility Patterns - 22nd Nov 21
The Most Important Lesson Learned from this COVID Pandemic - 22nd Nov 21
Dow Stock Market Trend Analysis - 22nd Nov 21
UK Covid-19 Booster Jabs Moderna, Pfizer Are They Worth the Risk of Side effects, Illness? - 22nd Nov 21
US Dollar vs Yields vs Stock Market Trends - 20th Nov 21
Inflation Risk: Milton Friedman Would Buy Gold Right Now - 20th Nov 21
How to Determine if It’s Time for You to Outsource Your Packaging Requirements to a Contract Packer - 20th Nov 21
2 easy ways to play Facebook’s Metaverse Spending Spree - 20th Nov 21
Stock Market Margin Debt WARNING! - 19th Nov 21
Gold Mid-Tier Stocks Q3’21 Fundamentals - 19th Nov 21
Protect Your Wealth From PERMANENT Transitory Inflation - 19th Nov 21
Investors Expect High Inflation. Golden Inquisition Ahead? - 19th Nov 21
Will the Senate Confirm a Marxist to Oversee the U.S. Currency System? - 19th Nov 21
When Even Stock Market Bears Act Bullishly (What It May Mean) - 19th Nov 21
Chinese People do NOT Eat Dogs Newspeak - 18th Nov 21
CHINOBLE! Evergrande Reality Exposes China Fiction! - 18th Nov 21
Kondratieff Full-Season Stock Market Sector Rotation - 18th Nov 21
What Stock Market Trends Will Drive Through To 2022? - 18th Nov 21
How to Jump Start Your Motherboard Without a Power Button With Just a Screwdriver - 18th Nov 21
Bitcoin & Ethereum 2021 Trend - 18th Nov 21
FREE TRADE How to Get 2 FREE SHARES Fractional Investing Platform and ISA Specs - 18th Nov 21
Inflation Ain’t Transitory – But the Fed’s Credibility Is - 18th Nov 21
The real reason Facebook just went “all in” on the metaverse - 18th Nov 21
Biden Signs a Bill to Revive Infrastructure… and Gold! - 18th Nov 21
Silver vs US Dollar - 17th Nov 21
Silver Supply and Demand Balance - 17th Nov 21
Sentiment Speaks: This Stock Market Makes Absolutely No Sense - 17th Nov 21
Biden Spending to Build Back Stagflation - 17th Nov 21
Meshing Cryptocurrency Wealth Generation With Global Fiat Money Demise - 17th Nov 21
Dow Stock Market Trend Forecast Into Mid 2022 - 16th Nov 21
Stock Market Minor Cycle Correcting - 16th Nov 21
The INFLATION MEGA-TREND - Ripples of Deflation on an Ocean of Inflation! - 16th Nov 21

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Gold & Silver Not Crowded Trades as J.P.Morgan Materially Cuts Short Silver Position Says Source

Commodities / Gold and Silver 2010 Dec 14, 2010 - 09:20 AM GMT

By: Adrian_Ash

Commodities

Best Financial Markets Analysis ArticleTHE PRICE OF GOLD rose to 1-week highs above $1400 per ounce overnight in Asia on Tuesday, rising as the Dollar fell on the forex market, before slipping back after new data showed much stronger-than-expected US retail sales and factory-gate inflation for November.

Crude oil slipped from $88.70 per barrel, and base metals also dipped.


Wholesale silver investment bars dropped 50 cents from $30 per ounce after extending Monday's rally – and gaining 4.3% from last week's finish – as the Financial Times reported that market-making brokerage and bank J.P.Morgan has “materially” reduced its bets on lower prices, citing “a person familiar with the matter.”

“It is absolutely incorrect to say or imply that the Nymex, CFTC or any other exchange or regulator has instructed or asked us to reduce our position,” the FT quotes a spokesman for J.P.Morgan, which acquired Bear Stearns' large precious metals dealing-book when it bought the failed investment bank in March 2008.

J.P.Morgan has been linked by internet authors with the unspecified “fraudulent efforts” to control silver prices alleged in Oct. by Commodity Futures Trading Commission commissioner Bart Chilton.

On the other side of the trade, the US gold futures market “has seen its net speculative position as a percent of [all contracts open] remain largely flat at 30.32%,” notes Standard Bank's Walter de Wet of the latest CFTC data.

In contrast with crude oil and copper markets, “This level is below the average level seen over the past year and points to a market that is not crowded yet. The same goes for Comex silver, where the net spec positions [bullish minus bearish bets held by non-industry players] have actually declined as a percent of OI to 18.35%, down from 20% [the previous] week.”

"Gold is following up momentum with the selling of Dollars towards the year end," said a Singapore bullion trader to Reuters earlier.

"[Gold prices] are resuming the uptrend, and there are not many down days to be expected."
Recording its 10th ever London Gold Fix above $1400 an ounce this morning, the gold price fell vs. the Euro as the single currency jumped 1.8% against the greenback on the forex market.

The gold price in British Pounds rose 0.8% after new data showed UK consumer price inflation rising to 3.3% annually last month, led by a record Oct-to-Nov. jump in each of food, clothing and furniture prices.

Nov. marked the 11th month running that inflation has stood 1% or more above the Bank of England's official 2.0% target. Charged only with defending consumer-price stability, the UK central bank has now kept its key interest rate at a record low of 0.5% for 20 months running.

Latest UK house-price data from the Royal Institute of Chartered Surveyors meantime says that “lack of demand from buyers continues to stifle the market, and new buyer enquiries fell for the sixth consecutive month” in Nov.

“Only if [Beijing] really raised interest rates would it put real pressure on the gold market," said Ronald Leung of Lee Cheong Gold Dealers in Hong Kong to Reuters this morning, after a report in the China Securities Journal said the central bank will again apply this year's ceiling of 7.5 trillion Yuan (US$1.12trn) to new bank lending in 2011.

Actual bank lending is likely to hit CNY7.8trn in 2010, the Economic Observer quotes a senior source today. The People's Bank has raised interest rates only once this year, but hiked bank-deposit reserve requirements six times – and applied price caps on a range of items – as consumer-price inflation has risen to 28-month highs above 5% per year.

“Today it was gold’s turn to shine,” says a Hong Kong dealer after “base metals rallied strongly in Asia” on Monday.

Gold dealing was “one-way traffic” this morning, he says.

Asian stock markets were muted, meantime, and European equities held flat on Tuesday morning, 
US and UK government bonds continued to tick lower in price, but German Bunds rose after an auction of new Spanish debt met with good demand, but only at sharply higher interest rates for the investors.

Spanish bonds fell hard in the open-market, driving 10-year yields to near-2010 records above 5.6%.

Buying some €2.7bn of Eurozone government debt in Nov., the European Central Bank now needs extra capital – perhaps twice its current €5.8bn, according to press reports – to cover possible losses on the €130bn of higher-risk assets it now holds.

Also today, the ECB published legal advice it's taken regarding political moves in European Union-member Hungary which “could be seen as the Government trying to influence” Budapest's central-bank governor “in the performance of his tasks.

“Any such influence would be contrary” to EU treaties, says the advice.

In Budapest yesterday, the Parliament approved state confiscation of privately-held mandatory pension funds by a majority of 250 to 58.

“The legislation is a de factor rollback of pension reforms in the late 90s that established a funded pension pillar alongside the state's pay-as-you-go system,” says Hungary's RealDeal finance site.

By Adrian Ash
BullionVault.com

Gold price chart, no delay   |   Buy gold online at live prices

Formerly 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 2010

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.


© 2005-2019 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