Best of the Week
Most Popular
1. Stock Markets and the History Chart of the End of the World (With Presidential Cycles) - 28th Aug 20
2.Google, Apple, Amazon, Facebook... AI Tech Stocks Buying Levels and Valuations Q3 2020 - 31st Aug 20
3.The Inflation Mega-trend is Going Hyper! - 11th Sep 20
4.Is this the End of Capitalism? - 13th Sep 20
5.What's Driving Gold, Silver and What's Next? - 3rd Sep 20
6.QE4EVER! - 9th Sep 20
7.Gold Price Trend Forecast Analysis - Part1 - 7th Sep 20
8.The Fed May “Cause” The Next Stock Market Crash - 3rd Sep 20
9.Bitcoin Price Crash - You Will be Suprised What Happens Next - 7th Sep 20
10.NVIDIA Stock Price Soars on RTX 3000 Cornering the GPU Market for next 2 years! - 3rd Sep 20
Last 7 days
The Truth About “6G” - 30th Nov 20
Ancient Aztec Secret Could Lead To A $6.9 Billion Biotech Breakthrough - 30th Nov 20
AMD Ryzen Zen 3 NO UK MSRP Stock - 5600x, 5800x, 5900x 5950x Selling at DOUBLE FAKE MSRP Prices - 29th Nov 20
Stock Market Short-term Decision Time - 29th Nov 20
Look at These 2 Big Warning Signs for the U.S. Economy - 29th Nov 20
Dow Stock Market Short-term and Long-term Trend Analysis - 28th Nov 20
How To Spot The End Of An Excess Market Trend Phase – Part II - 28th Nov 20
The Gold Stocks Correction is Maturing - 28th Nov 20
Biden and Yellen Pushed Gold Price Down to $1,800 - 28th Nov 20
Sheffield Christmas Lights 2020 - Peace Gardens vs 2019 and 2018 - 28th Nov 20
MUST WATCH Before You Waste Money on Buying A New PC Computer System - 27th Nov 20
Gold: Insurance for Prudent Investors, Precious Metals Reduce Risk & Preserve Wealth - 27th Nov 20
How To Spot The End Of An Excess Market Trend Phase - 27th Nov 20
Snow Falling Effect Christmas Lights Outdoor Projector Amazon Review - 27th Nov 20
4 Reasons Why You Shouldn't Put off Your Roof Repairs - 27th Nov 20
Further Clues Reveal Gold’s Weakness - 26th Nov 20
Fun Things to Do this Christmas - 26th Nov 20
Industries that Require Secure Messaging Apps - 26th Nov 20
Dow Stock Market Trend Analysis - 25th Nov 20
Amazon Black Friday Dell 32 Inch S3220DGF VA Curved Screen Gaming Monitor Bargain Deal! - 25th Nov 20
Biden the Silver Bull - 25th Nov 20
Inflation Warning to the Fed: Be Careful What You Wish For - 25th Nov 20
Financial Stocks Sector ETF Shows Unique Island Setup – What Next? - 25th Nov 20
Herd Immunity or Herd Insolvency: Which Will Affect Gold More? - 25th Nov 20
Stock Market SEASONAL TREND and ELECTION CYCLE - 24th Nov 20
Amazon Black Friday - Karcher K7 FC Pressure Washer Assembly and 1st Use - Is it Any Good? - 24th Nov 20
I Dislike Shallow People And Shallow Market Pullbacks - 24th Nov 20
Small Traders vs. Large Traders vs. Commercials: Who Is Right Most Often? - 24th Nov 20
10 Reasons You Should Trade With a Regulated Broker In UK - 24th Nov 20
Stock Market Elliott Wave Analysis - 23rd Nov 20
Evolution of the Fed - 23rd Nov 20
Gold and Silver Now and Then - A Comparison - 23rd Nov 20
Nasdaq NQ Has Stalled Above a 1.382 Fibonacci Expansion Range Three Times - 23rd Nov 20
Learn How To Trade Forex Successfully - 23rd Nov 20
Market 2020 vs 2016 and 2012 - 22nd Nov 20
Gold & Silver - Adapting Dynamic Learning Shows Possible Upside Price Rally - 22nd Nov 20
Stock Market Short-term Correction - 22nd Nov 20
Stock Market SPY/SPX Island Setups Warn Of A Potential Reversal In This Uptrend - 21st Nov 20
Why Budgies Make Great Pets for Kids - 21st Nov 20
How To Find The Best Dry Dog Food For Your Furry Best Friend?  - 21st Nov 20
The Key to a Successful LGBT Relationship is Matching by Preferences - 21st Nov 20
Stock Market Dow Long-term Trend Analysis - 20th Nov 20
Margin: How Stock Market Investors Are "Reaching for the Stars" - 20th Nov 20
World’s Largest Free-Trade Pact Inspiration for Global Economic Recovery - 20th Nov 20
Dating Sites Break all the Stereotypes About Distance - 20th Nov 20

Market Oracle FREE Newsletter

How to Get Rich Investing in Stocks by Riding the Electron Wave

Are Gold and Silver Bugs Running Scared?

Commodities / Gold and Silver 2011 Sep 28, 2011 - 11:58 AM GMT

By: Eric_McWhinnie


Since touching $1,535 briefly on Monday, gold prices have rallied and even stabilized above $1600.  Silver, which touched near $26 on Monday, has climbed back above $30.  The precious metals seem to be at the whims of Europe and a strengthening US dollar.  Furthermore, Germany (Europe’s economic powerhouse), does not appear to be pleased with the latest so-called sovereign debt crisis solution.

Hopes surfaced earlier this week of a plan to recapitalize Euro banks via the European Financial Stability Facility (EFSF). Talks include the EFSF being leveraged in order to provide more resources without having to receive approval by national parliaments. This caused the euro to strengthen and the dollar to weaken, which gave way to a strong gold and silver rally. After the leverage EFSF plan took center stage though, German finance minister, Wolfgang Schauble was not a happy camper. He said, “I don’t understand how anyone in the European Commission can have such a stupid idea.  The result would be to endanger the AAA sovereign debt ratings of other member states.  It makes no sense.” Now, gold and silver prices appear to be in a holding pattern as they trade sideways, awaiting the next development from Europe.

Don’t Miss: The Precious Metals Vault Business is Booming.

Although gold and silver can experience extreme price moves, the recent volatility with the Europe circus has not deterred most precious metal investors.  Reuters reports that the physical gold holdings by the SPDR Gold Trust decreased by less than 1% during the recent gold slump.  The article goes on to state, “The minor dip in holdings is remarkable, because many traders had initially feared that the advent of precious metal ETFs-which five years ago opened up the gold market to many retail and institutional customers by making it as easy to trade as stocks-would inject more volatility into markets. Instead, those same investors appear to be holding firm to the view that gold is a better long-term bet with the euro debt crisis and a sputtering US economy far from over.”  Precious metal ETFs are not the only way investors are playing gold and silver.  Many investors looking to protect themselves from a declining US dollar or global uncertainties also invest in physical bullion.  APMEX, a leading gold and silver bullion dealer, has seen an increase in demand despite the pullback in spot prices.  Last week, the online dealer had nearly 10,000 one ounce silver sunshine rounds. However, as metal investors continue to buy at lower prices, APMEX’s current supply of the popular silver rounds have dwindled down to less than 3,000.

Even though people have called into question gold’s safe haven status due to the recent US dollar strength, gold is still attracting buyers.  Director of metals trading at Vision Financial Markets, David Meger said, “People are not going to be easily squeezed out of their investment based on longer-term, positive bias toward gold.  It’s not a mentality among funds and individual investors that’s going to be easily shaken.  We really have to see a dramatic fundamental change here to change the overall investment view that gold is a safe haven. We have seen an aggressive price decline, but fundamentally I don’t believe much has changed.”

For more analysis on our support levels and ranges for gold and silver, consider a free 14-day trial to our acclaimed Gold & Silver Investment Newsletter.

By Eric_McWhinnie

Wall St. Cheat Sheet : Only days after the S&P 500 crashed to the depths of hell at 666, the Hoffman brothers launched Wall St. Cheat Sheet: one of the fastest growing financial media sites on the web. Like a samurai, our mission is to cut through the bull and bear shit with extraordinary insights, a fresh voice, and razor-sharp wit. We provide the highest quality education and information for active investors, financial professionals, and entrepreneurs.

© 2011 Copyright Eric McWhinnie - All Rights Reserved
Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors

© 2005-2019 - 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

6 Critical Money Making Rules