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
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
BLOCKCHAIN INVESTMENT PRIMER - 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

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