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
Eye Opening Currency Charts – Why Precious Metals Are Falling - 23rd May 19
Netflix Has 175 Days Left to Pull Off a Miracle… or It’s All Over - 23rd May 19
Capitalism Works, Ravenous Capitalism Doesn’t - 23rd May 19
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 Adds 1% But Silver Unwinds Week-on-Week Jump as Oil Price Hit by Margin Hike

Commodities / Gold and Silver 2011 Feb 25, 2011 - 07:29 AM GMT

By: Adrian_Ash

Commodities

BOTH GOLD and physical silver prices failed to hold onto a sharp overnight bounce in London trade on Friday, trading below $1404 and $33 respectively per ounce as volatility in crude oil remained at record levels but world stock markets rose for the first day in six.

The US Dollar snapped its 7-day losing streak, bouncing against the Euro, Sterling and Yen and leaving gold prices for non-Dollar investors slightly higher again.


Colonel Gaddafi's crackdown on anti-government protests in Libya was "escalating alarmingly" meantime, said the United Nations, with perhaps 1,000s dead in a near-civil war.

Food prices rallied from a four-day drop as Bangladesh and Japan both moved to secure supplies of rice.

"[Economic] demand is now recovering at home and abroad – quite strongly in some areas, and inflation is now a much bigger worry than deflation," said Bank of England policy-maker Andrew Sentance in a speech last night outlining "10 good reasons to raise".

Sentance has been out-voted 8-to-1 by his colleagues every month since he began calling for higher rates last June.

The UK today revised its end-2010 economic decline from the 0.5% first estimated to a 0.6% contraction.

Rumors that Colonel Gaddafi had been shot dead saw crude oil, gold and silver prices all slump late Thursday in New York.

Commodity-trading exchanges the Nymex and ICE also raised the margin payments needed to continue betting on oil prices – currently heading for a 13% weekly rise, the fastest gains since Feb. 2009.

"Those declines have proven to be a good buying opportunity," said one London metals dealer early on Friday. But by lunchtime, however, both gold and silver prices had eased back from their sharp recoveries, cutting their week-on-week gains to 1.0% and 0.1% respectively.

"It goes without saying, should the tension in the Middle East spiral out of control, and spread further throughout the region, our [Gold Price] target of $1500 may be reached must earlier than [the summer]," says today's commodity note from Standard Bank in London.

"Gold is witnessing a strong upward trend," says Filippo Finocchi on the trading desk at Italpreziosi in Arezzo, Italy. "But if the tensions in Libya should ease, the current level could be ideal for a start of a new corrective phase."

Even as near-term crude oil contracts rallied on Friday, far-dated contracts held onto their sharp falls in early trade, suggesting "either a big unwind or the beginnings of pessimism about sustained demand strength" in the global energy market according to Sean Corrigan at Diapason Commodities in Switzerland.

Prices for crude-oil contracts due to settle after 2012 were lower on Friday morning than they were before the Middle East unrest and uprisings began, notes the FT's Alphaville blog.

"Everyone's just being super-cautious," Reuters today quotes a prime broker servicing the hedge-fund sector, which hasn't yet taken an aggressive stance on the oil market.

"It's a little like the financial crisis in 2008. Many managers are saying, 'How am I supposed to figure this one out?'", says Morten Spenner at fund of fund managers International Asset Management.

Noting the 1.75% and 0.75% rise in Indian and Chinese interest rates in recent months, "If monetary tightening continues across the developing world we would expect to see physical demand for gold from emerging countries slacken as the year progresses," says French bank Natixis' latest Commodities Weekly report.

The London bullion dealer's analysis team also note India's new policy of encouraging rural households to open bank accounts through mobile phones (so-called "m-banking"), saying that "Were these policies to continue, it would not be unreasonable to expect Indian demand for gold to suffer."

Indian gold demand leapt two-thirds by volume and 106% by value to all-time record levels in 2010 according to latest data from market-development group the World Gold Council.

China's private household demand for physical gold rose 29% by volume and 62% by Dollar value, also hitting new record highs.

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 2011

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

6 Critical Money Making Rules