Best of the Week
Most Popular
1. Gold vs Cash in a Financial Crisis - Richard_Mills
2.Current Stock Market Rally Similarities To 1999 - Chris_Vermeulen
3.America See You On The Dark Side Of The Moon - Part2 - James_Quinn
4.Stock Market Trend Forecast Outlook for 2020 - Nadeem_Walayat
5.Who Said Stock Market Traders and Investor are Emotional Right Now? - Chris_Vermeulen
6.Gold Upswing and Lessons from Gold Tops - P_Radomski_CFA
7.Economic Tribulation is Coming, and Here is Why - Michael_Pento
8.What to Expect in Our Next Recession/Depression? - Raymond_Matison
9.The Fed Celebrates While Americans Drown in Financial Despair - John_Mauldin
10.Hi-yo Silver Away! - Richard_Mills
Last 7 days
1. GOOGLE (Alphabet) - Primary AI Tech Stock For Investing 2020 - 17th Jan 20
ERY Energy Bear Continues Basing Setup – Breakout Expected Near January 24th - 17th Jan 20
What Expiring Stock and Commodity Market Bubbles Look Like - 17th Jan 20
Platinum Breaks $1000 On Big Rally - What's Next Forecast - 17th Jan 20
Precious Metals Set to Keep Powering Ahead - 17th Jan 20
Stock Market and the US Presidential Election Cycle  - 16th Jan 20
Shifting Undercurrents In The US Stock Market - 16th Jan 20
America 2020 – YEAR OF LIVING DANGEROUSLY (PART TWO) - 16th Jan 20
Yes, China Is a Currency Manipulator – And the U.S. Banking System Is a Metals Manipulator - 16th Jan 20
MICROSOFT Stock Investing in AI Machine Intelligence Mega-trend 2020 and Beyond - 15th Jan 20
Silver Traders Big Trend Analysis – Part II - 15th Jan 20
Silver Short-Term Pullback Before Acceleration Higher - 15th Jan 20
Gold Overall Outlook Is 'Strongly Bullish' - 15th Jan 20
AMD is Killing Intel - Best CPU's For 2020! Ryzen 3900x, 3950x, 3960x Budget, to High End Systems - 15th Jan 20
The Importance Of Keeping Invoices Up To Date - 15th Jan 20
Stock Market Elliott Wave Analysis 2020 - 14th Jan 20
Walmart Has Made a Genius Move to Beat Amazon - 14th Jan 20
Deep State 2020 – A Year Of Living Dangerously! - 14th Jan 20
The End of College Is Near - 14th Jan 20
AI Stocks Investing 2020 to Profit from the Machine Intelligence Mega-trend - Video - 14th Jan 20
Stock Market Final Thrust - 14th Jan 20
British Pound GBP Trend Forecast Review - 13th Jan 20
Trumpism Stock Market and the crisis in American social equality - 13th Jan 20
Silver Investors Big Trend Analysis for – Part I - 13th Jan 20
Craig Hemke Gold & Silver 2020 Prediction, Slams Biased Gold Naysayers - 13th Jan 20
AMAZON Stock Investing in AI Machine Intelligence Mega-trend 2020 and Beyond - 11th Jan 20
Gold Price Reacting to Global Flash Points - 11th Jan 20
Land Rover Discovery Sport 2020 - What You Need to Know Before Buying - 11th Jan 20
Gold Buying Precarious - 11th Jan 20
The Crazy Stock Market Train to Bull Eternity - 11th Jan 20
Gold Gann Angle Update - 10th Jan 20
Gold In Rally Mode Suggests Commitment of Traders (COT) Data - 10th Jan 20
Disney Could Mount Its Biggest Rally in 2020 - 10th Jan 20
How on Earth Can Gold Decline During the U.S. – Iran Crisis? - 10th Jan 20
Getting Your HR Budget in Line - 10th Jan 20
The Fed Protects Gamblers at the Expense of the Economy - 9th Jan 20
Last Chance to Get Microsoft Windows 10 for FREE! - 9th Jan 20
The Stock Market is the Opiate of the Masses - 9th Jan 20
Is The Energy Sector Setting Up Another Great Entry? - 9th Jan 20
The Fed Is Creating a Monster Bubble - 9th Jan 20
If History Repeats, Video Game Stocks Could Soar 600%+ - 9th Jan 20
What to Know Before Buying a Land Rover Discovery Sport in 2020 - 8th Jan 20
Stock Market Forecast 2020 Trend Analysis - 8th Jan 20
Gold Price at Resistance - 8th Jan 20
The Fed Has Quietly Started QE4 - 8th Jan 20
NASDAQ Set to Fall 1000pts Early 2020, and What it Means for Gold Price - 8th Jan 20
Gold 2020 - Financial Analysts and Major Financial Institutions Outlook - 8th Jan 20
Stock Market Trend Review - 8th Jan 20

Market Oracle FREE Newsletter

Nadeem Walayat Financial Markets Analysiis and Trend Forecasts

Gold Flat as Coffee Surges 20% in 6 Days and Oats Surge 40% in Week

Commodities / Commodities Trading Jun 17, 2010 - 07:17 AM GMT

By: GoldCore

Commodities

Best Financial Markets Analysis ArticleGold and silver fell marginally yesterday in lacklustre trade on thin volumes. Gold appears to be consolidating above $1,200/oz and support can be seen at $1,177/oz and $1,145/oz (see chart below). As ever in the short term anything could happen but given the continuing degree of sovereign risk, gold is more likely to move higher than lower in the medium term and $1,300/oz remains possible over the summer despite the traditionally negative season. Gold is currently trading at $1,234/oz and in euro, GBP, CHF, and JPY terms, at €998/oz, £834/oz, CHF 1,374/oz, JPY 112,664/oz respectively.


Gold in USD - 1 Year (Daily).

Many banks and bullion dealers have recently been revising up their gold forecasts (the majority of which were again bearish on gold this year). Our year end price target of $1,350/oz to $1,400/oz remains viable and indeed there is the possibility of a spike to higher levels.

While Wall Street was flat overnight and Asian markets mixed, European equities have risen so far this morning showing risk appetite continues and for now markets are ignoring continuing significant financial, economic and monetary risks.

Cross Currency Table - 1030 GMT.

The Swiss franc, the euro, the pound and gold are stronger this morning with the US dollar and commodity currencies coming under pressure (see Cross Currency Table above). Coffee has surged 20% in a 6 day surge and oats have surged 40% in a week. The Reuters CRB remain below its highest levels of earlier this year and whether this is the start of a trend for higher commodity prices remains to be seen.

Gold remains sanguine with gradual movements up and down and rarely has seen movements of more than 2% in a day. Inter day volatility has jumped recently by gold's move up in recent months has been gradual and gold is only marginally above the price it was trading at in early December 2009. The six month period of consolidation and gradual rise would suggest that the (nominal) price highs seen recently are sustainable and not a bubble as proclaimed by some. The sharp movements seen in the coffee and oats markets are the type of price action that one would expect to see in the gold pits when we reach a gold mania or 'gold rush' or a bubble on a par with the 1970s when gold rose 25 times in 9 years and over 100% in one year - 1979. In 1979, gold rose 140.27 percent - from $US 234.40/oz to $US 563.20/oz.

The recent calm in debt markets has ended as Greek, Portuguese and Spanish bonds fell sharply and the Spanish German bond spread rose to its highest since the inception of the euro yesterday. Investors bought Spanish debt at a government auction today, assuaging concern that the nation will struggle to meet forthcoming redemptions for the moment. The sales were likely only possible after the sharp falls in price and rising yield seen in recent days. Spanish government bonds lost investors 4.3 percent this year, compared with returns of 6.5 percent for German bonds and a 15 percent loss for Greek debt, according to indexes compiled by Bloomberg and the European Federation of Financial Analysts Societies.

Inflation pressures remain internationally as seen in Britain where the CPI for May was at 3.4% and remains more than twice the rate in the eurozone and has been significantly above target since December. Many economists and the Bank of England maintain that this is a short term blip higher and is "temporary" and appear to underestimating the risk of inflation and stagflation. Especially, as VAT is likely to rise in next week's emergency budget. Given the UK's poor fiscal position, sterling's underperformance versus gold is likely to continue.

G10 Currencies and Precious Metals Performance - Quarter to Date.

Silver

Silver is currently trading at $18.47/oz, €14.92/oz and £12.49/oz.

Platinum Group Metals

Platinum is trading at $1,576/oz and palladium is currently trading at $474/oz. Rhodium is at $2,425/oz.

News

Gold prices may reach between $1,450 and $1,470 an ounce by the end of the year as investors look to bullion as a safer investment than currency trading, David Baker, a managing partner of Baker Steel Capital Managers, said in a Bloomberg Television interview (Bloomberg).

KABUL - An Afghan mining official says the untapped minerals in the war-torn country are worth at least $3 trillion - triple a U.S. estimate. Minister of Mines Wahidullah Shahrani said Thursday he's going to Britian next week to discuss how to attract foreign investors to mine one of the world's largest iron ore deposits in Bamiyan province. The relatively safe area is in the heart of the war-torn nation.
The U.S. Department of Defence earlier said Afghanistan's reserves of iron, copper, cobalt, gold and other prized minerals could be worth $1 trillion. Shahrani says that's conservative.

The ministry has been working with international partners to assess Afghanistan's mineral reserves and improve the expertise of Afghan geologists (AP).

European debt markets remain under high stress on persistent reports that Spain is in secret talks with EU officials and the International Monetary Fund for a support package of up to 250bn (£208bn), the largest rescue in history. The spreads on 10-year Spanish bonds jumped to a post-EMU high of 224 basis points above German Bunds as traders brace for a crucial auction by Madrid on Thursday. The relentless rise in bond yields replicates the pattern seen in Greece at the onset of crisis. Spain must raise 25bn of debt in a cluster of auctions in July. "We're in a dangerous and stressful situation," said Gary Jenkins, a credit expert at Evolution Securities. "Spain is a big enough borrower to wipe out the EU's rescue fund" (Daily Telegraph).

This update can be found on the GoldCore blog here.

Mark O'Byrne
Director

IRL
63
FITZWILLIAM SQUARE
DUBLIN 2

E info@goldcore.com

UK
NO. 1 CORNHILL
LONDON 2
EC3V 3ND

IRL +353 (0)1 632 5010
UK +44 (0)203 086 9200
US +1 (302)635 1160

W www.goldcore.com

WINNERS MoneyMate and Investor Magazine Financial Analysts 2006

Disclaimer: The information in this document has been obtained from sources, which we believe to be reliable. We cannot guarantee its accuracy or completeness. It does not constitute a solicitation for the purchase or sale of any investment. Any person acting on the information contained in this document does so at their own risk. Recommendations in this document may not be suitable for all investors. Individual circumstances should be considered before a decision to invest is taken. Investors should note the following: Past experience is not necessarily a guide to future performance. The value of investments may fall or rise against investors' interests. Income levels from investments may fluctuate. Changes in exchange rates may have an adverse effect on the value of, or income from, investments denominated in foreign currencies. GoldCore Limited, trading as GoldCore is a Multi-Agency Intermediary regulated by the Irish Financial Regulator.

GoldCore is committed to complying with the requirements of the Data Protection Act. This means that in the provision of our services, appropriate personal information is processed and kept securely. It also means that we will never sell your details to a third party. The information you provide will remain confidential and may be used for the provision of related services. Such information may be disclosed in confidence to agents or service providers, regulatory bodies and group companies. You have the right to ask for a copy of certain information held by us in our records in return for payment of a small fee. You also have the right to require us to correct any inaccuracies in your information. The details you are being asked to supply may be used to provide you with information about other products and services either from GoldCore or other group companies or to provide services which any member of the group has arranged for you with a third party. If you do not wish to receive such contact, please write to the Marketing Manager GoldCore, 63 Fitzwilliam Square, Dublin 2 marking the envelope 'data protection'

GoldCore Archive

© 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

6 Critical Money Making Rules