Best of the Week
Most Popular
1. US Housing Market House Prices Bull Market Trend Current State - Nadeem_Walayat
2.Gold and Silver End of Week Technical, CoT and Fundamental Status - Gary_Tanashian
3.Stock Market Dow Trend Forecast - April Update - Nadeem_Walayat
4.When Will the Stock Market’s Rally Stop? - Troy_Bombardia
5.Russia and China Intend to Drain the West of Its Gold - MoneyMetals
6.BAIDU (BIDU) - Top 10 Artificial Intelligence Stocks Investing To Profit from AI Mega-trend - Nadeem_Walayat
7.Stop Feeding the Chinese Empire - ‘Belt and Road’ Trojan Horse - Richard_Mills
8.Stock Market US China Trade War Panic! Trend Forecast May 2019 Update - Nadeem_Walayat
9.US China Trade Impasse Threatens US Lithium, Rare Earth Imports - Richard_Mills
10.How to Invest in AI Stocks to Profit from the Machine Intelligence Mega-trend - Nadeem_Walayat
Last 7 days
The Euro Is Bidding Its Time: A Reversal at Hand? - 23rd May 19
Gold Demand Rose 7% in Q1 2019. A Launching Pad Higher for Gold? - 23rd May 19
Global Economic Tensions Translate Into Oil Price Volatility - 22nd May 19
The Coming Pension Crisis Is So Big That It’s a Problem for Everyone - 22nd May 19
Crude Oil, Hot Stocks, and Currencies – Markets III - 22nd May 19
The No.1 Energy Stock for 2019 - 22nd May 19
Brexit Party and Lib-Dems Pull Further Away from Labour and Tories in Latest Opinion Polls - 22nd May 19
The Deep State vs Donald Trump - US vs Them Part 2 - 21st May 19
Deep State & Financial Powers Worry about Alternative Currencies - 21st May 19
Gold’s Exciting Boredom - 21st May 19
Trade War Fears Again, Will Stocks Resume the Downtrend? - 21st May 19
Buffett Mistake Costs Him $4.3 Billion This Year—Here’s What Every Investor Can Learn from It - 21st May 19
Dow Stock Market Trend Forecast 2019 May Update - Video - 20th May 19
A Brief History of Financial Entropy - 20th May 19
Gold, MMT, Fiat Money Inflation In France - 20th May 19
WAR - Us versus Them Narrative - 20th May 19
US - Iran War Safe-haven Reasons to Own Gold - 20th May 19
How long does Google have to reference a website? - 20th May 19
Tory Leadership Contest - Will Michael Gove Stab Boris Johnson in the Back Again? - 19th May 19
Stock Market Counter-trend Rally - 19th May 19
Will Stock Market “Sell in May, Go Away” Lead to a Correction… or a Crash? - 19th May 19
US vs. Global Stocks Sector Rotation – What Next? Part 1 - 19th May 19
BrExit Party EarthQuake Could Win it 150 MP's at Next UK General Election! - 18th May 19
Dow Stock Market Trend Forecast 2019 May Update - 18th May 19
US Economy to Die a Traditional Death… Inflation Is Going to Move Higher - 18th May 19
Trump’s Trade War Is Good for These 3 Dividend Stocks - 18th May 19
GDX Gold Mining Stocks Fundamentals Update - 17th May 19
Stock Markets Rally Hard – Is The Volatility Move Over? - 17th May 19
The Use of Technical Analysis for Forex Traders - 17th May 19
Brexit Party Set to Storm EU Parliament Elections - Seats Forecast - 17th May 19
Is the Trade War a Catalyst for Gold? - 17th May 19
This Is a Recession Indicator No One Is Talking About—and It’s Flashing Red - 17th May 19
War! Good or Bad for Stocks? - 17th May 19
How Many Seats Will Brexit Party Win - EU Parliament Elections Forecast 2019 - 16th May 19
It’s Not Technology but the Fed That Is Taking Away Jobs - 16th May 19
Learn to Protect your Forex Trading Capital - 16th May 19
Gold Ratio Charts Offer The Keys to the Bull Market - 16th May 19
Is Someone Secretly Smashing the Stock Market at Night? - 16th May 19

Market Oracle FREE Newsletter

U.S. House Prices Analysis and Trend Forecast 2019 to 2021

Gold Bounces with Euro as Trichet Hints at Greece Bailout

Commodities / Gold and Silver 2010 Feb 09, 2010 - 08:53 AM GMT

By: Adrian_Ash


THE PRICE OF GOLD slipped from its best level in 3 sessions for both US and UK investors on Tuesday in London, easing back as the Euro currency and Eurozone stocks also cut their early gains.

Government bonds ticked lower, while US crude oil contracts pushed up towards $73 per barrel.

Silver erased a 1.6% rally as New York opened for business, holding unchanged from last week's 5-month closing low.

"The pull back is not that great compared to previous corrections," says bullion bank Scotia Mocatta, studying the bullish position of speculative traders in gold futures and options – now 15% smaller from the middle of Jan.

"But this could be taken either as a sign that the market remains relatively bullish still, or conversely it also raises the potential for more liquidation."

"Greater declines [in gold investment positions] may be evident in the coming week's data," says the VM Group in London.

Adding together the "net long" position of speculators in US and Tokyo futures, plus the outstanding size of the major gold ETF trust funds worldwide, the VM Group's Precious Metals Investment Weekly for Fortis Nederland Bank now says that global investment has shrunk 5% over the last four weeks.

China Investment Corp. – one of the world's largest sovereign wealth funds – took a $156 million exposure to gold prices at the tail-end of 2009, new US regulatory filings show.

Although small in terms of the Chinese fund's total $300bn under management, CIC's position in New York's SPDR Gold Trust shows a continuation of the fund's strategy," says Japanese metals conglomerate Mitsui, "which...saw it divert around $10bn into commodity-related concerns."

New data today confirmed that China overtook Germany in 2009 as the world's No.1 export nation, as German exports of goods fell by 18% – the sharpest year-on-year since 1950.

"The Dollar might have further to rebound as investors seek out safe-havens and as carry trades are unwound," Scotia Mocatta adds in its latest Precious Metals Monthly, but "this should not prevent gold prices from rallying as well.

"After all, the Dollar and gold both managed to rally in 2004 and in the second half of 2008."

"We'd advise taking a defensive view of the Euro," says Standard Bank's Steven Barrow today, because the "debt crisis in the Eurozone is not likely to be resolved in a benign way.

"Policymakers like those at the Fed and Bank of England have essentially chosen inflation through aggressive quantitative easing. Others, like the ECB, have opted not to take this route with the consequence that some members, like Greece, could be heading for default."

European Central Bank president Jean-Claude Trichet today raised hopes of a Eurozone rescue for the Greek government's huge fiscal deficit, by changing his schedule to include a meeting this Thursday discussing the problem.

"There is nothing like a change in a VIP's travel plans to excite the imaginations of market participants," said Stephen Lewis at London's Monument Securities on hearing the news.

Wall Street's S&P index jumped 1% at the start of trade Tuesday, remaining closely tied to the path of Euro/Dollar exchange rates and almost exactly Nailed to the Dollar Price of Gold.

New data here in the UK meantime showed Retail Sales falling faster than expected last month, even as the UK's trade balance worsened sharply.

"Amid the recent flight to safety, gilts have missed out," notes the FT's Alpha blog after the first auction of UK government debt since the Bank of England suspended its quantitative easing program drew tepid demand.

"Gilts are also lower this morning, no doubt unsettled by the latest Populus opinion poll, which showed support for the Labour party up 2 percentage points to 30% and increasing the possibility of a hung parliament."

By Adrian Ash

Gold price chart, no delay | Free Report: 5 Myths of the Gold Market
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 , 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 - 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