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
Peloton 35% CRASH a Lesson of What Happens When One Over Pays for a Loss Making Growth Stock - 1st Dec 21
Stock Market Sentiment Speaks: I Fear For Retirees For The Next 20 Years - 1st Dec 21 t
Will the Anointed Finanical Experts Get It Wrong Again? - 1st Dec 21
Main Differences Between the UK and Canadian Gaming Markets - 1st Dec 21
Bitcoin Price TRIGGER for Accumulating Into Alt Coins for 2022 Price Explosion - 30th Nov 21
Omicron Covid Wave 4 Impact on Financial Markets - 30th Nov 21
Can You Hear It? That’s the Crowd Booing Gold’s Downturn - 30th Nov 21
Economic and Market Impacts of Omicron Strain Covid 4th Wave - 30th Nov 21
Stock Market Historical Trends Suggest A Strengthening Bullish Trend In December - 30th Nov 21
Crypto Market Analysis: What Trading Will Look Like in 2022 for Novice and Veteran Traders? - 30th Nov 21
Best Stocks for Investing to Profit form the Metaverse and Get Rich - 29th Nov 21
Should You Invest In Real Estate In 2021? - 29th Nov 21
Silver Long-term Trend Analysis - 28th Nov 21
Silver Mining Stocks Fundamentals - 28th Nov 21
Crude Oil Didn’t Like Thanksgiving Turkey This Year - 28th Nov 21
Sheffield First Snow Winter 2021 - Snowballs and Snowmen Fun - 28th Nov 21
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

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Gold Traders Torn as Ireland Takes Bail-Out But Euro Falls

Commodities / Gold and Silver 2010 Nov 22, 2010 - 07:39 AM GMT

By: Adrian_Ash

Commodities

Best Financial Markets Analysis ArticleTHE PRICE OF GOLD closely tracked the Euro currency on Monday morning, initially rising after Ireland agreed a €90 billion rescue package from its European partners and the International Monetary Fund, but slipping back after Dublin coalition members the Green Party then called for a general election in January.


Finance minister Brian Lenihan dubbed the call "the height of irresponsibility", and the gold price in Dollars edged down to last week's finish at $1354 per ounce as the single currency lost more than 1¢ from an early one-week high.

The silver price in Dollars also retreated from an early rally, trading back at Friday's record-high weekly close of $27.36 per ounce.

"We are torn regarding gold's near-term direction," says the latest note from Switzerland's MKS Finance team.

"A deeper correction shouldn't be ruled out, [but] ongoing uncertainty created by Eurozone debt issues and another round of quantitative easing in the US are expected to continue to attract buyers to the perceived safe-haven asset."

Delays to cash aid for Athens, sparked by its failure to reduce spending, mean that "parts" of the Greek government may be forced to "shut down" from next week, according to a US economics consultancy today.

Portugal's socialist government said today that its banking sector is "resilient and well capitalised", and the state has a "clear strategy" for cutting its deficit.

"Most traders were torn [overnight in Asia on Monday] between Ireland's rescue deal and China's move to tighten its economy," says a Hong Kong dealer.

That meant Asian players "were unsure and chose not to trade aggressively."

Following the Greek rescue agreed in June, both the EU and IMF said today they were "satisfied" with Dublin's new 4-year debt reduction plan, due to be revealed to the Irish public in next month's Budget.

Although outside the single-currency Eurozone, the UK today offered Dublin some £7 billion (€8.1bn, $11.2bn). British institutions hold one-fifth of Ireland's public and banking debt, according to Reuters' data.

Luxembourg's prime minister Jean Claude Juncker said there will "in no way" be any debt restructuring – forcing losses onto bondholders – before 2013.

Finance chief Lenihan meantime told reporters today that France and Germany have dropped demands that Ireland raise its ultra-low corporation tax, saying that "We are a sovereign state".

Dollar-Gold's daily correlation with the Euro currency – typically strong and positive since the Euro project began in 2000 – turned above zero for the first time in 6 sessions on Friday.

Over on the US gold futures and options market, latest data – released late Friday – showed a 5% fall in the total number of open contracts in the week-ending last Tuesday.

Total open interest remained historically high, however, recording its second-largest number ever.

Within the gold futures and options data, the "net long" position held by speculative, non-industry players fell by more than 8% to a three-month low equivalent to 895 tonnes of metal.

On the other side of the trade, the "net short" (of bullish minus bearish bets) held by commercial, gold-industry players also shrank to a 13-week low, falling by almost 12% from late September's near-record level.

"You have enormous open interest in the December gold, silver and palladium Comex and Nymex futures contracts," said the CPM consultancy group's Jeffrey Christian to South Africa's MineWeb on Friday last week.

"[This] suggests that there could be a very volatile upward move in metal prices, followed by very volatile sell-off after they make new highs."

Further ahead, "We're seeing a cyclical peak in the fourth quarter of this year [or] first quarter of next year, and then gold prices will move sideways or somewhat lower," Christian believes.

"How low it goes will depend partly on how high it goes between now and then, but we won't be surprised to see the gold price fall back to $1200 or maybe even lower in the middle part of 2011, and then start to rise again."

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