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
This Ultimate Formula Will Help You Avoid Dividend Cutting Stocks - 24th May 19
Benefits of a Lottery Online Account - 24th May 19
Technical Analyst: Gold Price Weakness Should Be Short Term - 24th May 19
Silver Price Looking Weaker than Gold - 24th May 19
Nigel Farage's Brexit Party EU Elections Seats Results Forecast - 24th May 19
Powerful Signal from Gold GDX - 24th May 19
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

Market Oracle FREE Newsletter

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

Gold Falls Sharply in Europe

Commodities / Gold & Silver Nov 12, 2007 - 10:21 AM GMT

By: Gold_Investments

Commodities Gold
Gold was down $3.10 to $832.10 per ounce in New York on Friday and silver was up 1 cent to $15.48 per ounce. Gold was up some 3% last week and silver surged by over 6%.

In Asian and European trading both have sold off and gold is down to $815 per ounce at 1230 GMT. Profit taking, a fall in oil prices and tentative dollar strength are likely the primary reasons behind this much anticipated correction. Gold will likely find good support at the psychological level of $800 per ounce.


Gold is down in EUR and flat in GBP. It is trading at £393 GBP (down from £394.60 ) and €560 EUR (down from €566.50). The UK's horrendous trade figures (GBP 7.8 billion in September), with the biggest trade deficit in goods since records began in the late 17th Century brought the pound's recent strength against the dollar and some other currencies to an abrupt halt. Record oil prices and the fact that the UK's North Sea oil production is already in decline (Energy Minister Malcolm Wicks says the national aim is now merely to slow the decline from 8-9% to 5%. Last year production was at its lowest since the first major production year in 1979) are contributing to the large trade deficits. This in conjunction with falling property prices and record debt levels is likely to lead to much lower economic growth in the UK which bodes well for the price of gold in GBP in the coming months.

The FT has a Fund Management Report 'Going for gold - in search of safety' in which Ruth Sullivan writes that investors seeking refuge from a second wave of credit turbulence and a sliding dollar have helped push up the price of spot gold to more than $845 (£403, €576) an ounce, close to an all-time record high, and up more than 33 per cent for the year. "We think we are seeing the end of the US dollar and G7 economy era and investors are reacting by shifting out of dollars and in to the safety of gold," says Giles Conway-Gordon, managing partner of Cogo Wolf Global Strategy Fund, a San Francisco based fund of hedge funds.

Forex and Gold
The dollar has shown tentative signs of recovery against the EUR and has strengthened significantly against the GBP on heavy GBP selling. The euro is at 1.455 (from 1.4751) and at 2.069 (from 2.116).
Doug Noland reports in his Credit Bubble Bulletin that the dollar index fell 1.2% to 75.40 last week. For the week on the upside, the Japanese yen increased 3.4%, the Swiss franc 2.8%, the Norwegian krone 1.6%, the Swedish krona 1.6%, the Danish krone 1.4%, and the Euro 1.4%. Currencies that weakened against the USD were, the Mexican peso declined 1.5%, the Canadian dollar 1.1%, the Australian dollar 1.0%, and the New Zealand dollar 0.8%.

As reported above, GBP has fallen sharply on increasing risk aversion. Investors are exiting carry trade positions whereby they borrowed yen and bought the higher yielding British pound. GBP/JPY has now fallen from a Friday high of nearly 238 to a low in Asia at 228.5. Thus in less than 24 hours of trading GBP fell by nearly 4% against the yen (JPY).

An unravelling of the yen (JPY) and Swiss franc (CHF) humongous carry trades on increasing risk aversion could lead to a currency crisis and systemic issues and it is important to keep an eye on this possibility. Products such as Power Reverse Dual Multi-Callables effectively package up a geared carry trade - (some of them 10 times geared). USD/YEN105 is an important level in this regard. The huge scale and leverage involved could potentially devastate some large hedge funds and banks balance sheets. There are outstanding derivatives of USD402 trillion and this is thus clearly a real risk.

Silver
Silver remains volatile and has corrected after last weeks 6% gain and is trading at $15.05 at 1230 GMT.

PGMs
The non-monetary metals have fallen in conjunction with some other commodities and base metals.
Platinum was trading at $1411/1416 (1230 GMT).
Spot palladium was trading at $364/369 an ounce (1230 GMT).

Oil
Oil prices fell more than $1 a barrel Monday in Asia after reports that the oil exporter group OPEC would discuss increasing its output at an upcoming meeting in a bid to cool record crude prices according to Associated Press. Light, sweet crude for December delivery dropped $1.26 to $95.06 a barrel in Asian electronic trading on the New York Mercantile Exchange by midafternoon in Singapore. The contract rose 86 cents to settle at $96.32 a barrel Friday. Prices could rise ahead of the expiration of options on December crude oil futures Tuesday, with investors holding a heap of $100 call options — which allow traders to buy the underlying futures contract at a predetermined price and date.

 

Gold Investments
63 Fitzwilliam Square
Dublin 2
Ireland
Ph +353 1 6325010
Fax  +353 1 6619664
Email info@gold.ie
Web www.gold.ie
Gold Investments
Tower 42, Level 7
25 Old Broad Street
London
EC2N 1HN
United Kingdom
Ph +44 (0) 207 0604653
Fax +44 (0) 207 8770708
Email info@goldinvestments.org
Web www.goldinvestments.org

Mission Statement
Gold and Silver Investments Limited hope to inform our clientele of important financial and economic developments and thus help our clientele and prospective clientele understand our rapidly changing global economy and the implications for their livelihoods and wealth.
We focus on the medium and long term global macroeconomic trends and how they pertain to the precious metal markets and our clienteles savings, investments and livelihoods. We emphasise prudence, safety and security as they are of paramount importance in the preservation of wealth.

Financial Regulation: Gold & Silver Investments Limited trading as Gold Investments is regulated by the Financial Regulator as a multi-agency intermediary. Our Financial Regulator Reference Number is 39656. Gold Investments is registered in the Companies Registration Office under Company number 377252 . Registered for VAT under number 6397252A . Codes of Conduct are imposed by the Financial Regulator and can be accessed at www.financialregulator.ie or from the Financial Regulator at PO Box 9138, College Green, Dublin 2, Ireland. Property, Commodities and Precious Metals are not regulated by the Financial Regulator

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: 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. Past experience is not necessarily a guide to future performance.

All the opinions expressed herein are solely those of Gold & Silver Investments Limited and not those of the Perth Mint. They do not reflect the views of the Perth Mint and the Perth Mint accepts no legal liability or responsibility for any claims made or opinions expressed herein.

Fair Use Notice: This newsletter contains copyrighted material the use of which has not always been specifically authorized by the copyright owner. We are making such material available in our efforts to advance understanding of issues of financial and economic significance. At all times we credit and attribute the copywrite owner and publication.
We believe this constitutes a 'fair use' of any such copyrighted material as provided for in Copyright Law. The material on this site is distributed without profit to those who have expressed a prior interest in receiving the included information for economic research purposes. If you wish to use copyrighted material from this site for purposes of your own that go beyond 'fair use', you must obtain permission from the copyright owner.

Gold Investments 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