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
Stock Market Minor Correction Due - 13th Apr 21
How to Feed Budgies Cucumbers - Best Vegetables Feeding for the First Time, Parakeet Care UK - 13th Apr 21
Biggest Inflation Threat in 40 Years Looms over Markets - 13th Apr 21
How to Get Rich with the Pareto Distribution - Tesco Example - 13th Apr 21
Litecoin and Bitcoin-Which Is Better? - 13th Apr 21
The Major Advantages Of Getting Your PhD Online - 12th Apr 21
Covid-19 Pandemic Current State for UK, US, Europe, Brazil Vaccinations vs Lockdown's Third Wave - 12th Apr 21
Why These Stock Market Indicators Should Grab Your Full Attention - 12th Apr 21
Rising Debt Means a Weaker US Dollar - 12th Apr 21
Another Gold Stocks Upleg - 12th Apr 21
AMD The ZEN Tech Stock - 12th Apr 21
Overclockers UK Build Quality - Why Glue Fan to CPU Heat sink Instead of Using Supplied Clips? - 12th Apr 21 -
What are the Key Capabilities You Should Look for in Fleet Management Software? - 12th Apr 21
What Is Bitcoin Gold? - 12th Apr 21
UK Covd-19 FREE Lateral Flow Self Testing Kits How Use for the First Time at Home - 10th Apr 21
NVIDIA Stock ARMED and Dangeorus! - 10th Apr 21
The History of Bitcoin Hard Forks - 10th Apr 21
Gold Mining Stocks: A House Built on Shaky Ground - 9th Apr 21
Stock Market On the Verge of a Pullback - 9th Apr 21
What Is Bitcoin Unlimited? - 9th Apr 21
Most Money Managers Gamble With Your Money - 9th Apr 21
Top 5 Evolving Trends For Mobile Casinos - 9th Apr 21
Top 5 AI Tech Stocks Investing 2021 Analysis - 8th Apr 21
Dow Stock Market Trend Forecast 2021 - Crash or Continuing Bull Run? - 8th Apr 21
Don’t Be Fooled by the Stock Market Rally - 8th Apr 21
Gold and Latin: Twin Pillars of Western Rejuvenation - 8th Apr 21
Stronger US Dollar Reacts To Global Market Concerns – Which ETFs Will Benefit? Part II - 8th Apr 21
You're invited: Spot the Next BIG Move in Oil, Gas, Energy ETFs - 8th Apr 21
Ladies and Gentlemen, Mr US Dollar is Back - 8th Apr 21
Stock Market New S&P 500 Highs or Metals Rising? - 8th Apr 21
Microsoft AI Azure Cloud Computing Driving Tech Giant Profits - 7th Apr 21
Amazon Tech Stock PRIMEDAY SALE- 7th Apr 21
The US has Metals Problem - Lithium, Graphite, Copper, Nickel Supplies - 7th Apr 21
Yes, the Fed Will Cover Biden’s $4 Trillion Deficit - 7th Apr 21
S&P 500 Fireworks and Gold Going Stronger - 7th Apr 21
Stock Market Perceived Vs. Actual Risks: The Key To Success - 7th Apr 21
Investing in Google Deep Mind AI 2021 (Alphabet) - 6th Apr 21
Which ETFs Will Benefit As A Stronger US Dollar Reacts To Global Market Concerns - 6th Apr 21
Staying Out of the Red: Financial Tips for Kent Homeowners - 6th Apr 21
Stock Market Pushing Higher - 6th Apr 21
Inflation Fears Rise on Biden’s $3.9 TRILLION in Deficit Spending - 6th Apr 21
Editing and Rendering Videos Whilst Background Crypto Mining Bitcoins with NiceHash, Davinci Resolve - 5th Apr 21
Why the Financial Gurus Are WRONG About Gold - 5th Apr 21
Will Biden’s Infrastructure Plan Rebuild Gold? - 5th Apr 21
Stocks All Time Highs and Gold Double Bottom - 5th Apr 21
All Tech Stocks Revolve Around This Disruptor - 5th Apr 21
Silver $100 Price Ahead - 4th Apr 21
Is Astra Zeneca Vaccine Safe? Risk of Blood Clots and What Side Effects During 8 Days After Jab - 4th Apr 21
Are Premium Bonds A Good Investment in 2021 vs Savings, AI Stocks and Housing Alternatives - 4th Apr 21
Penny Stocks Hit $2 Trillion - The Real Story Behind This "Road to Riches" Scheme - 4th Apr 21
Should Stock Markets Fear Inflation or Deflation? - 4th Apr 21
Dow Stock Market Trend Forecast 2021 - 3rd Apr 21
Gold Price Just Can’t Seem to Breakout - 3rd Apr 21
Stocks, Gold and the Troubling Yields - 3rd Apr 21
What can you buy with cryptocurrencies?- 3rd Apr 21
What a Long and Not so Strange Trip it’s Been for the Gold Mining Stocks - 2nd Apr 21
WD My Book DUO 28tb Unboxing - What Drives Inside the Enclosure, Reds or Blues Review - 2nd Apr 21
Markets, Mayhem and Elliott Waves - 2nd Apr 21
Gold And US Dollar Hegemony - 2nd Apr 21
What Biden’s Big Infrastructure Push Means for Silver Price - 2nd Apr 21
Stock Market Support Near $14,358 On Transportation Index Suggests Rally Will Continue - 2nd Apr 21
Crypto Mine Bitcoin With Your Gaming PC - How Much Profit after 3 Weeks with NiceHash, RTX 3080 GPU - 2nd Apr 21
UK Lockdowns Ending As Europe Continues to Die, Sweet Child O' Mine 2021 Post Pandemic Hope - 2nd Apr 21
A Climbing USDX Means Gold Investors Should Care - 1st Apr 21
How To Spot Market Boom and Bust Cycles - 1st Apr 21
What Could Slay the Stock & Gold Bulls - 1st Apr 21
Precious Metals Mining Stocks Setting Up For A Breakout Rally – Wait For Confirmation - 1st Apr 21
Fed: “We’re Not Going to Take This Punchbowl Away” - 1st Apr 21
Mining Bitcoin On My Desktop PC For 3 Weeks - How Much Crypto Profit Using RTX 3080 on NiceHash - 31st Mar 21
INFLATION - Wage Slaves vs Gold Owners - 31st Mar 21
Why It‘s Reasonable to Be Bullish Stocks and Gold - 31st Mar 21
How To Be Eligible For An E-Transfer Payday Loan? - 31st Mar 21
eXcentral Review – Trade CFDs with a Customer-Centric Broker - 31st Mar 21

Market Oracle FREE Newsletter

FIRST ACCESS to Nadeem Walayat’s Analysis and Trend Forecasts

Gold Continues to Fall Despite Strong Seasonal Tendencies

Commodities / Gold & Silver Aug 18, 2008 - 07:37 AM GMT

By: Adrian_Ash

Commodities SPOT GOLD PRICES gave back a sharp 2% rally early in London on Monday, falling towards $790 per ounce as the US Dollar held flat on the currency markets.

Crude oil ticked up 25¢ to trade above $114 per barrel as Tropical Storm Fay threatened rigs in the Gulf of Mexico .


European stock markets were slightly higher as the Wall Street start drew near.

"Precious metals sentiment is still bearish as the US Dollar continues to strengthen against the Euro, albeit in a volatile manner," said Walter de Wet in today's market note from Standard Bank.

"The sharp Dollar rally seen in the last month makes us more confident that the Dollar's slide against most major currencies, which began in 2001, is over," adds his colleague Steve Barrow in London , "[although] the path back to a stronger Dollar in coming years won't be a smooth one."

This new bearish consensus on Gold – mirroring a 7% jump in the Dollar's trade-weighted index since this time last month – led hedge funds and other "large speculators" to close almost one-in-five of their bullish bets in the futures & options market last week.

Overall, says the latest data from US regulator the CFTC, the total number of live gold contracts now in play shrank by 11% in the week-ending Tues 12 Aug., taking "open interest" to its lowest level since Sept. 2007.

It's down by one quarter from the same time last month and smaller by one-third from the all-time peak set back in January.

But while professional and institutional investors trading paper bets on the Gold Price scramble to reduce their positions, private individuals are creating a squeeze in physical metal right across Europe and North America.

The US Mint has reportedly halted sales of American Gold Eagle coins, and is said to be refusing new orders from gold bullion dealers.

Kitco Inc., one of the largest gold investment retailers in the USA and Canada , warns on its website that "due to market volatility and higher demand in the entire industry, we are anticipating delays in supply of all bullion products.

"Once inventory is received there may...be delays in processing and shipping by our vaults."

Meantime in Germany , the Pro Aurum dealership based in Munich says that its website hit "meltdown" last week thanks to record-high traffic. It claims the same problem hit other German gold retailers, too.

"We've seen a dramatic increase in the number of orders. We called in our gold-dealing team to work the Assumption Day holiday [on Friday]. All our branches saw prolonged waiting times for over-the-counter cash sales, and this will surely continue over the coming week."

Pro Aurum also says it cannot fulfill specialist orders for rarer coins, and claims that "major institutions" asked if they could help out with delivery of physical metal.

Here at BullionVault , in contrast – the international service for private investors wanting to slash the cost of buying, owning and selling physical gold – the availability of professional-grade gold bullion, starting from one gram and up, remains entirely unaffected.

The stock of Good Delivery Gold Bars belonging to customers grew to 8.45 tonnes last week as users bought almost half-a-tonne of warranted bullion. ( You can Learn More About BullionVault here... )

"Fundamentally, I'm not sure about the Dollar in the long-term," said Masahiko Ejiri, a fund manager at the $26 billion Mizuho Asset Management Co. in Tokyo, to Bloomberg earlier today.

"I'm still a strong believer that commodity prices have to rise further because demand growth outpaces supply."

In Saudi Arabia , gold sales by value rose 14% to reach $1.3 billion between April and June reported the World Gold Council's local office today.

India 's gold demand fell 47% in volume terms between January and June from the same period last year, the WGC also said. But the recent drop in world Gold Prices has had "a positive impact on demand," according to one leading jewelry dealer in Mumbai.

"Once Gold Prices stabilize at lower levels, one could see a significant increase in demand," he went on, pointing to the typical Seasons in Gold that have seen prices rise almost 10% between August and January on average over the last decade.

Meantime on Wall Street today, analysts now expect a June-to-Sept. loss costing up to $1.8 billion or more from Lehman Bros., the fourth-largest securities firm in the United States.

Officials from the US Treasury are preparing to "wipe out" existing shareholders in Fannie Mae and Freddie Mac, according to a report in Barron's magazine, as part of a cash rescue to stop the nation's largest home mortgage lenders collapsing.

Following last week's agreement by Morgan Stanley to and settle $35 million in fines and buy back $4.5 billion of untradable "auction-rate securities" – the "$330bn behemoth that melted down in February" as Martin Hutchinson puts it at Prudent Bear – the second-largest US investment bank is now said by the Wall Street Journal to be tying new hedge fund loans directly to its own credit rating in the bond market.

Essentially, a better price for Morgan's own debt means it will extend new credit to those hedge funds using its services.

"If our firm is in trouble," in short, "we would rather fund ourselves than fund hedge funds," the WSJ quotes one broker claiming to know of the arrangement. It is apparently being applied by Goldman Sachs, too.

By Adrian Ash
BullionVault.com

Gold price chart, no delay | Free Report: 5 Myths of the Gold Market
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 2008

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.

Adrian Ash 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