Most Popular
1. It’s a New Macro, the Gold Market Knows It, But Dead Men Walking Do Not (yet)- Gary_Tanashian
2.Stock Market Presidential Election Cycle Seasonal Trend Analysis - Nadeem_Walayat
3. Bitcoin S&P Pattern - Nadeem_Walayat
4.Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun - Nadeem_Walayat
4.U.S. financial market’s “Weimar phase” impact to your fiat and digital assets - Raymond_Matison
5. How to Profit from the Global Warming ClImate Change Mega Death Trend - Part1 - Nadeem_Walayat
7.Bitcoin Gravy Train Trend Forecast 2024 - - Nadeem_Walayat
8.The Bond Trade and Interest Rates - Nadeem_Walayat
9.It’s Easy to Scream Stocks Bubble! - Stephen_McBride
10.Fed’s Next Intertest Rate Move might not align with popular consensus - Richard_Mills
Last 7 days
How to Capitalise on the Robots - 20th June 24
Bitcoin, Gold, and Copper Paint a Coherent Picture - 20th June 24
Why a Dow Stock Market Peak Will Boost Silver - 20th June 24
QI Group: Leading With Integrity and Impactful Initiatives - 20th June 24
Tesla Robo Taxis are Coming THIS YEAR! - 16th June 24
Will NVDA Crash the Market? - 16th June 24
Inflation Is Dead! Or Is It? - 16th June 24
Investors Are Forever Blowing Bubbles - 16th June 24
Stock Market Investor Sentiment - 8th June 24
S&P 494 Stocks Then & Now - 8th June 24
As Stocks Bears Begin To Hibernate, It's Now Time To Worry About A Bear Market - 8th June 24
Gold, Silver and Crypto | How Charts Look Before US Dollar Meltdown - 8th June 24
Gold & Silver Get Slammed on Positive Economic Reports - 8th June 24
Gold Summer Doldrums - 8th June 24
S&P USD Correction - 7th June 24
Israel's Smoke and Mirrors Fake War on Gaza - 7th June 24
US Banking Crisis 2024 That No One Is Paying Attention To - 7th June 24
The Fed Leads and the Market Follows? It's a Big Fat MYTH - 7th June 24
How Much Gold Is There In the World? - 7th June 24
Is There a Financial Crisis Bubbling Under the Surface? - 7th June 24
Bitcoin Trend Forecast, Crypto's Exit Strategy - 31st May 24
Zimbabwe Officials Already Looking to Inflate New Gold-Backed Currency - 31st May 24
India Silver Imports Have Already Topped 2023 Total - 31st May 24
Gold Has Done Its Job – Isn’t That Enough? - 31st May 24
Gold Stocks Catching Up - 31st May 24
Time to take the RED Pill - 28th May 24
US Economy Slowing Slipping into Recession, But Not There Yet - 28th May 24
Gold vs. Silver – Very Important Medium-term Signal - 28th May 24
Is Gold Price Heading to $2,275 - 2,280? - 28th May 24
Stocks Bull Market Smoking Gun - 25th May 24
Congress Moves against Totalitarian Central Bank Digital Currency Schemes - 25th May 24
Government Tinkering With Prices Is Like Hiding All of the Street Signs - 25th May 24
Gold Mid Tier Mining Stocks Fundamentals - 25th May 24
Why US Interest Rates are a Nothing Burger - 24th May 24
Big Banks Are Pressuring The Fed To Losen Protection For Depositors - 24th May 24
Another Bank Failure: How to Tell if Your Bank is At Risk - 24th May 24
AI Stocks Portfolio and Tesla - 23rd May 24
All That Glitters Isn't Gold: Silver Has Outperformed Gold During This Gold Bull Run - 23rd May 24
Gold and Silver Expose Stock Market’s Phony Gains - 23rd May 24
S&P 500 Cyclical Relative Performance: Stocks Nearing Fully Valued - 23rd May 24
Nvidia NVDA Stock Earnings Rumble After Hours - 22nd May 24
Stock Market Trend Forecasts for 2024 and 2025 - 21st May 24
Silver Price Forecast: Trumpeting the Jubilee | Sovereign Debt Defaults - 21st May 24
Bitcoin Bull Market Bubble MANIA Rug Pulls 2024! - 19th May 24
Important Economic And Geopolitical Questions And Their Answers! - 19th May 24
Pakistan UN Ambassador Grows Some Balls Accuses Israel of Being Like Nazi Germany - 19th May 24
Could We See $27,000 Gold? - 19th May 24
Gold Mining Stocks Fundamentals - 19th May 24
The Gold and Silver Ship Will Set Sail! - 19th May 24

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Gold Price Undergoing Correction

Commodities / Gold & Silver 2009 Nov 13, 2009 - 07:43 AM GMT

By: Adrian_Ash

Commodities

Best Financial Markets Analysis ArticleTHE PRICE OF GOLD bounced from an overnight dip to $1101 an ounce in London dealing on Friday, heading into the weekend 0.9% higher from last week as world stock markets held onto their near-3% gains.

Crude oil fell towards $76 per barrel while government bonds were flat, as was the Dollar.


"Gold is undergoing a slight correction, as the market is very long and the rise has been quite fast over the last few days," says a note from MKS Finance in Geneva.

"The USD is still determining the trend."

"The Dollar is a gold driver but it's not the only one," counters Walter de Wet in today's Commodities Daily from Standard Bank. "[There's] a clear step-change in the gold price irrespective of which currency is used.

"Real demand for gold is rising,"

"Gold's surge may indicate that investors fear the next stage of the crisis will occur in the foreign-exchange markets," says Philip Coggan in his Buttonwood column for this week's Economist.

"Developed-country governments have attempted to control bond yields through quantitative easing and to support stock markets through ultra-low interest rates. But they cannot support their currencies as well without risking problems in the bond and equity markets."

New data today showed US import prices falling faster than analysts forecast in October, while the monthly trade deficit widened by nearly a fifth to $36.5 billion.

The 16-nation Eurozone reported an end to its 15-month recession, but with weaker-than-expected GDP growth of 0.4% in the third quarter.

Thursday saw the US Treasury report a record October deficit, the 13th monthly shortfall in a row. The Federal Reserve last week vowed to hold its key interest at next-to-zero for an "extended period".

The Bank of England here in London has now created £200 billion of new money since March, using it primarily to buy government bonds as Whitehall's deficit hits a peace-time record equal above 14% of GDP.

China's central bank reported record gold reserves this spring of 1054 tonnes. The Reserve Bank of India bought 200 tonnes of gold from the International Monetary Fund at the start of November. Russia's gold reserves have risen by more than 71 tonnes since January.

"[Thursday's] price action shows as a large outside day," says Scotia Mocatta's technical analysis today, "typically good reversal warnings."

"Gold and silver yesterday surpassed both the high and low from Wednesday," agrees a London dealer in their technical note.

A lower close would be needed on Friday for technical analysis to "confirm" a change in short-term direction. The gold price in Dollars has risen 6.0% since the start of November.

"You just don't see increases like this over the short term," says Steve Condon, head of investor advice at Truepoint Capital in Cincinnati, speaking to the Associated Press.

"This isn't materially different from gambling."

The gold price has risen for 11 of the last 13 weeks against the Dollar, compared with nine and seven against the British Pound and European single currency respectively.

"[People] are bringing in jewelry from the '70s and '80s they don't wear anymore," says Anthony Iannelli, owner of Iannelli Diamonds in New York's diamond district, speaking to the AP.

"They're following the news and see gold prices are high. They realize they have a little cache, and want to take it out of the vault."

Asked what will happen if gold reaches $1500 an ounce, "I think it will just about kill the gold jewelry business," he says.

New figures released by the Birmingham Assay Office yesterday showed UK hall-marking down 40% between July and Sept. compared with the same period last year.

The number of silver and platinum items hall-marked both rose slightly.

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 2009

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