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Gold up but limps to 2012 with 4th-quarter loss
* Gold up about 10 pct on year, but suffers Q4 loss
* Spot gold could rebound to $1,588/oz - technicals
* Dollar weaker after hitting highest in more than 11 months
By Susan Thomas and Rujun Shen
LONDON/SINGAPORE, Dec 30 (Reuters) - Gold rose on Friday from the previous day's six-month lows as the dollar weakened, but the euro zone crisis that has kept investors out of the market toward the end of a volatile 2011 will stay in sharp focus heading into the new year.
The precious metal was on course for a rise of about 10 percent for 2011 - its tenth straight annual gain. But it is down around 19 percent from a record $1,920.30 per ounce in September and is on track for its first quarterly loss in more than three years.
Gold in recent months has often abandoned its traditional status of a shelter from turmoil as investors have liquidated positions to free up dollars as the euro zone debt crisis caused money markets to seize up.
Gold still gave investors a return of 9.3 percent in 2011, but it underformed U.S. 10-year Treasuries, which returned about 17 percent,Brent crude oil with 13.5 percent and German 10-year Bunds 31.1 percent.
Spot gold was up 1.1 percent at $1,563.03 at 1434 GMT but is still down more than 10 percent for the month.
" We need to see the hot money from speculators. We need to see real money from the money managers coming back to this market. They have been absent throughout December," Saxo Bank senior manager Ole Hansen said.
A weaker dollar helped prop up precious metals. The dollar index edged lower, after rising to its highest in more than 11 months in the previous session.
" That is really where it's coming from," Hansen said.
A weaker dollar can lift dollar-denominated commodities by making them less expensive for consumers using other currencies.
The most-active U.S. gold futures contract gained 1.5 percent to $1,564, snapping six straight sessions of losses.
Technical analysis suggested that spot gold could rebound to $1,588 during the day, said Reuters market analyst Wang Tao.
The 20-day moving average crossed below the 200-day moving average for the first time since 2009, forming what some analysts call a " death cross" , but others said gold is facing a lengthy consolidation phase rather than a bear market.
" A negative crossover in moving averages can be seen as a selling signal," said Tim Riddell, head of ANZ Global Markets Research, Asia.
" But in gold's profile, it is probably a confirmation signal that gold has made a cyclical high in the third quarter, and will likely see a more protracted consolidation phase than the market would initially wish to see."
EURO ZONE
Industrial metals and equities also rose in the last trading day of the year, but concerns about the euro zone debt crisis and global growth remained.
Italy, the euro zone's third-largest economy, remains at the centre of the debt crisis that began in Greece two years ago, and its borrowing needs could overwhelm the bloc's financial defences if it were forced to seek an international bailout.
But in the United States, employment, housing market and manufacturing data pointed to growing momentum in the world's largest economy.
Physical buying of gold was also up, with falling gold price pushing up demand in India, luring jewellers who began restocking and preparing for the wedding season beginning in mid-January.
The Lunar New Year in about three weeks will also help support gold consumption in China, traders said.
Silver rose 0.8 percent to $27.96, platinum was up 0.8 percent at $1,380.50 and palladium was up 1.1 percent at $636.97. (Editing by Jane Baird)
By Peter LaTonaDecember 30, 2011GOOD DAY FOR GOLD, SILVERThe U.S. stock market closed the year with another down day. In the end, the optimistic projections of a year ago did not come to pass, but the markets at least did not lose ground. The Gold price, on the other hand, was up 11% for the year.
As we move into 2012, we can see more than ever that in this interconnected global economy in which we live, uncertainty may be the norm. “Black Swan” events might occur so often, we might need to call them “Grey Swan” events. Those of us who watch mainstream news can often become frustrated with so many experts spending so many words saying nothing. We hear much and talk much about “hard choices,” but with the exception of Ireland, no nation is really making any. Perhaps we should begin asking ourselves some hard questions.
In an article by Michael Snyder, published at Business Insider, he gives every American 40 hard questions we should be asking now. I will list a few and invite you to click on the above link and see the rest. Regardless of whether you agree with the nature of these questions, they provide something to think about.
1. If Iran tries to shut down the Strait of Hormuz, what will that do to the price of oil? And what will that do to the global economy?
3. Why is the Federal Reserve bailing out Europe? And why are so few members of Congress objecting to this?
5. Why does the euro keep dropping like a rock? Is this a sign that Europe is heading for a major recession?
6. Why are European banks parking record-setting amounts of cash at the European Central Bank? Is this evidence that banks don't want to lend to one another and that we are on the verge of a massive credit crunch?
8. What did the head of the International Monetary Fund mean when she recently said that we could soon see conditions “reminiscent of the 1930s depression”?
For now, I prescribe a wonderful and happy New Year’s weekend. We will have issues to tackle in 2012, but they can wait a few more days.
Happy new year from all of us at APMEX!
At 4 p.m., the APMEX precious metals spot prices were:
- Gold - $1,568.00 – Up $26.10.
- Silver - $27.94 – Up $0.56.
Gold limps to 2012 with last quarter loss
* Gold up nearly 10 pct on year, but suffers Q4 loss
* Spot gold could rebound to $1,588/oz - technicals
* Dollar weaker after hitting highest in more than 11 months
By Susan Thomas and Rujun Shen
LONDON/SINGAPORE, Dec 30 (Reuters) - Gold rose on Friday, rebounding from the previous day's six-month lows as the dollar weakened, but the euro zone crisis that has kept investor cash out of the market will stay in sharp focus heading into the new year after a volatile 2011.
The precious metal headed for a rise of nearly 10 percent for 2011, after 10 straight annual gains. But it is down nearly 19 percent from a record $1,920.30 hit in September, and is on track for its first quarterly loss in more than three years.
Despite the difficult year, gold has in recent months often abandoned its traditional status of a shelter from turmoil as investors liquidated positions to free up dollars as the euro zone debt crisis caused money markets to seize up.
Gold still gave investors a return of about 9.3 percent in 2011, but it underformed U.S. 10-year Treasuries, which returned about 17 percent,Brent crude oil gave 13.5 percent and German 10-year Bunds 31.1 percent.
Spot gold was up 1.5 percent at $1,568.50 at 1233 GMT, but was still down around 10 percent for the month.
" We need to see the hot money from speculators, we need to see real money from the money managers coming back to this market. They have been absent throughout December," Saxo Bank senior manager Ole Hansen said.
A weaker dollar helped prop up precious metals. The dollar index edged lower, after rising to its highest in more than 11 months in the previous session.
" That is really where it's coming from," Hansen said.
A weaker dollar can lift dollar-denominated commodities by making them less expensive for consumers using other currencies.
The most-active U.S. gold futures contract gained 1.9 percent to $1,570 by 1233 GMT, snapping six straight sessions of losses.
Technical analysis suggested that spot gold could rebound to $1,588 during the day, said Reuters market analyst Wang Tao.
The 20-day moving average crossed below the 200-day moving average for the first time since 2009, forming what some analysts call a " death cross" , but others said gold is facing a lengthy consolidation phase rather than a bear market.
" A negative crossover in moving averages can be seen as a selling signal," said Tim Riddell, head of ANZ Global Markets Research, Asia.
" But in gold's profile, it is probably a confirmation signal that gold has made a cyclical high in the third quarter, and will likely see a more protracted consolidation phase than the market would initially wish to see."
EURO ZONE
Industrial metals and equities also rose in the last trading day of the year, but concerns about the euro zone debt crisis and global growth remain.
Italy, the euro zone's third-largest economy, remains at the centre of the debt crisis that began inGreece two years ago and its borrowing needs could overwhelm the bloc's financial defences if it were forced to seek an international bailout.
But in the United States, employment, housing market and manufacturing data pointed to growing momentum in the world's largest economy.
Physical buying is also up, with falling gold price pushing up demand in India, luring jewellers who began restocking and preparing for the wedding season beginning mid-January.
The Lunar New Year in about three weeks will also help support gold consumption in China, traders said.
Silver rose 0.6 percent to $27.91, platinum was up 0.6 percent at $1,377.49 and palladium was up 0.5 percent at $632.97. (Editing by Anthony Barker)
By Ryan SchwimmerDecember 30, 2011GOLD HEADS FOR 11TH ANNUAL GAIN U.S. stock futures are inching upward this morning, while Gold and Silver are recovering nicely from the recent dip. All signs are pointing to an uneventful end to an otherwise eventful year. There are no major economic reports being released, and investors seem to be looking past the Chinese purchasing managers index for December. That report fell to 48.7, which indicates a contraction in the manufacturing sector for a nation that typically is seen as a major key to global economic recovery.
Gold is heading toward its 11th annual gain, and the first months of a new year typically see greater demand from India, which leads the world in Gold buying. Economist Dennis Gartman said he is “about to become bullish” on Gold after selling most of his position during the past few months. He said, “We did not expect to see Gold hold as well as it has or did in the past 24 hours.”
As Arab League monitors observe the situation in Syria, 10 people were reportedly shot dead during protests this morning. Activists are hoping to meet with the monitors soon to discuss the government crackdown on the protests. Britain’s minister for the Middle East and North Africa said, “Unfortunately, reports show that the violence has continued in Syria over the past few days. I urge the Syrian government to meet fully its obligations to the Arab League, including immediately ending the repression and withdrawing security forces from cities. The Syrian government must allow the Arab League mission independent and unrestricted access.”
At 8 a.m. (CST), the APMEX precious metals spot prices were:
- Gold - $1,567.10 – Up $25.10.
- Silver - $27.97 – Up $0.58.
Last Updated : 30 December 2011 at 11:05 IST
Gold will bottom in Jan-Feb, then explode to $1900/oz
By Toby Connor
With the move below $1535 this morning Gold has confirmed that it is still moving down into a D-Wave bottom. There has been some question as to whether or not the D-Wave had bottomed in September. The penetration of that intermediate low this morning confirms that the D-Wave did not end during the overnight sell off on September 26.
In the chart below I have marked with blue arrows the last several yearly cycle lows. As you can see they tend to occur in January or February. The timing band for the next cycle low should occur sometime in early to mid January. That should mark the bottom of this D-Wave decline with the slight possibility that there could be one more short daily cycle down, bottoming in early February.
This will almost certainly be dependent on whether the dollar cycle has one or two more daily cycles higher before rolling over into an intermediate decline. Current sentiment levels on the dollar index are suggesting only one daily cycle higher, which should signal a final bottom in the gold market sometime in the next 2-3 weeks.
If gold can make it back to the 50% retracement in the next couple of weeks I would probably be inclined to call a yearly cycle low at that point. If however Gold holds above $1500 at the next daily cycle low due in early to mid-January then I would be wary of one more daily cycle down to test the 2010 consolidation zone and 50% retracement ($1400) sometime in early February.
The combination of the dollar rally out of its three year cycle low, gold's yearly cycle low, and a D-Wave decline are going to produce a very sharp correction in the gold bull market. Before this is over most analysts will declare the gold bull dead. On the contrary, sometime early next year you are going to get the single best buying opportunity we will ever have to re-enter the secular gold bull in preparation for the bubble phase that should top in late 2014 or early 2015.
As a matter of fact, now that we have confirmed that this is an ongoing D-Wave decline, once its bottom has formed it will generate a violent A-wave advance that should test the 1800 the $1900 level rather quickly later this spring.
Serious money will be made during the A-wave advance. One just needs the patience to wait for the D-Wave to bottom before jumping back into the pool.
Source: goldscents
//I read I post //
Last Updated : 30 December 2011 at 10:25 IST
'2012: Silver is going to outperform gold'
James West,the editor of The Midas Letter and portfolio advisor of the Midas Letter Opportunity Fund, isn't interested in timing the precious metals market—that's a good way to end up butchering perfectly good investments. He believes Silver price is going to be one-sixteenth of theGold price so it's already undervalued by at least two-thirds. Gold and silver are both going to continue to appreciate. Also he agree with Sprott when he says that silver is going to outperform gold. [MORE]
December 29, 2011 • 12:13:59 PST This is all a thin paper market, we have not seen one single physical seller of gold or silver at these prices. So it’s just manipulation & panic in ... Read More
December 29, 2011 • 11:32:30 PST
Tres yields are falling fast & curve flattening (2s10s30s dropping rapidly) Silver is rallying hard off its lows (Gold held back for collateral/cash/r... Read More
Gold heads into new year with final quarter loss
* Gold up nearly 10 pct on year, but suffers Q4 loss
* Shanghai buys at open, arbitrage gap closes quickly
* Spot gold could rebound to $1,588/oz - technicals
* Coming up: US CFTC commitment of traders, 2030 GMT
By Rujun Shen
SINGAPORE, Dec 30 (Reuters) - Spot gold is ending 2011
on a weak note after ten consecutive annual gains, heading for
its first quarter of losses in more than three years and a new
year likely to be dominated by worries about economic growth and
sovereign debt.
U.S. gold rose more than 1 percent on Friday, as sharp falls
in the previous session triggered buying interest on the
Shanghai market, helping push spot gold up 0.8 percent.
This brings spot gold to a near-10 percent gain for the
year, but the precious metal is down about 19 percent from the
record peak of $1,920.30 an ounce hit in September.
The most-active U.S. gold futures contract gained
1.2 percent to $1,559.90 by 0244 GMT, snapping six consecutive
sessions of losses.
Spot gold rose 0.8 percent to $1,557.94, on course
for a weekly decline of 3.2 percent. It was headed for a monthly
loss of nearly 11 percent.
" There was buying interest from Shanghai when the market
opened there," said Peter Fung, head of dealing at Wing Fung
Precious Metals in Hong Kong.
The active Shanghai gold forwards opened at
312.45 yuan a gram ($1,537.8 an ounce), about $14 below spot
gold prices. But the gap quickly closed, as Shanghai gold rose
to 318.25 yuan, about $9 above spot prices.
The upcoming Lunar New Year in about three weeks will help
support gold consumption in China, traders said.
Technical analysis suggested that spot gold could rebound to
$1,588 during the day, said Reuters market analyst Wang Tao.
Concerns about the euro zone debt crisis continued to weigh
on the single currency after Italy's bond auction failed to
attract much buying interest and the European Central Bank had
to step in and buy Italy's bonds in an effort to slow rising
yields.
On the other side of the Atlantic, U.S. employment, housing
market and manufacturing data pointed to growing momentum in the
world's largest economy.
The dollar index edged lower, after rising to its
highest in more than 11 months in the previous session.
A pricier dollar weighs on gold and other commodities as it
makes them more expensive for buyers holding other currencies.
By Peter LaTonaDecember 29, 2011GOLD PRICES MOVE OFF LOWS SILVER ENDS DAY POSITIVE The U.S. stock market rebounded from yesterday’s losses and is again positive for the year. The Gold price declined for the sixth day in a row, but did climb well above morning lows. The rally in Gold and Silver prices began in the early afternoon as the value of the euro made sharp gains relative to the dollar. Silver made even a stronger move as the euro prices went up, and it closed positive for the day.
The big driver of the upbeat stock market was that the number of people contracting to buy existing homes went up more than forecast for November. The 7.3% increase was much higher than the 1.5% expectation. Mortgage rates are at all-time lows, while housing prices continue to fall. This provides strong stimulation for increased demand. Most economists see an improved housing picture as essential for job growth and a recovering economy.
At 4 p.m., the APMEX precious metals spot prices were:
- Gold - $1,547.80 – Down $17.30.
- Silver - $27.81 – Up $0.51.
* Euro falls to 15-month low against dollar
* Platinum hits lowest in more than 2 years
* Silver falls to 3-month low
By Silvia Antonioli
LONDON, Dec 29 (Reuters) - Gold dropped to its lowest in almost 6-months on Thursday as the euro fell against the dollar after an Italian bond auction saw yields at an unsustainable level and renewed euro zone fears and credit tightness worries.
Echoing the weakness in gold, spot platinum fell more than 3 percent to its lowest since November 2009 and silver fell more than 3 percent to a 3-month low.
The euro fell below $1.29 for the first time in 15 months as fear that Europe's debt crisis could worsen next year left traders scrambling to sell the currency before the calendar turns.
The latest cause of concern was Italy, which had to pay nearly 7 percent to borrow at a 10-year bond auction, a level seen as still uncomfortably high for a country with such a high debt burden and facing slow growth. A stronger U.S. unit makes dollar-priced commodities such as precious metals costlier for holders of other currencies.
" Peripheral yields are still on the rise the 6-month Italian debt auction wasn't that bad but the long-term auction is still lacking trust," said VTB Capital analyst Andrey Kryuchenkov.
" Sentiment is still down since it's the year-end and really you have larger problems at hand: the markets are still disappointed with the ECB reluctance to become the lender of last resort and changing fiscal discipline will take time."
Spot gold fell 1.57 percent to $1,530.60 an ounce by 1427 GMT, from $1,555.19 late in New York on Wednesday.
Earlier it hit a near six-month low of $1,521.94.
U.S. gold February futures lost more 2 percent to $1,530.70.
LIQUIDITY SQUEEZE
A spiralling euro debt crisis and increased need for liquidity in the last few months have pushed banks and other financial participants to sell assets including gold, generally deemed to be a safe haven during economic woes.
Gold was on course for a 12 percent fall this month, its biggest drop since October 2008 when the credit crunch hit most financial markets.
" The stress in the banking sector has increases as indicators such as the euro/dollar basis swaps show... There is a shortage of liquidity and, if you have to refinance, you have to sell your assets, including gold," said Credit Suisse analyst Tobias Merath.
" Gold is not a safe haven assets against a liquidity crisis. Banks need to sell assets to raise cash and avoid bankruptcy."
A rebound for gold is possible if policymakers take measures such as liquidity injection or interest rates cuts, which could help alleviate the credit crunch and would lessen the necessity to sell assets such as commodities, analysts said.
Silver was down 2.26 percent at $26.43 after an ounce while palladium was down 1.27 percent at $626.41 an ounce.
Platinum was last down 2.57 percent at $1,347.50 an ounce.
It earlier hit its lowest in more than 2 years at $1,338.20.
Platinum was hit harder than other precious metals due to growth fears in the euro zone for 2012, Kryuchenkov said.
As in Europe buyers prefer diesel engines with a higher platinum content, poor growth in this region dampens platinum demand prospects.
(Editing by William Hardy)
By Peter LaTonaDecember 29, 2011GOLD, SILVER PRICES LOWER IN EARLY TRADING Although Gold and Silver prices have bounced off their morning lows, the trend of the past couple of days has been decidedly downward. The euro fell through an important price point of 1.30 and is currently trading at 1.2895. Clearly, the euro is dealing with a significant lack confidence. As the euro has fallen relative to the U.S. dollar, Gold and Silver have followed their historical trend to move down as the dollar goes up.
There are several opinions about why the euro has fallen as rapidly as it has recently. One is the concern that the European Central Bank (ECB) might still decide to roll the printing press. Another opinion is that the weaker euro has to do with the rapid expansion (10%) of the ECB balance sheet in one week. European banks took the money loaned to them by the ECB and, instead of investing, took the least risky path and parked the money in the ECB overnight depository. A third opinion revolves around the Italian bond market, which has been very unstable lately. Although today’s 10-year Italian bond auction went smoothly, this situation has not calmed to any level of certainty. All three may very well be playing a part, but the increase in the ECB’s balance sheet probably is the current driving factor.
Weekly jobless claims in the United States rose more than expected, but the number remained below 400,000. Initial claims for jobless benefits went up 15,000 to 381,000. Economists polled by Reuters had forecasted 375,000 claims. Although this does break the streak of three weeks of declining claims, most analyst expect a gradual positive trend to continue.
At 8 a.m., the APMEX precious metals spot prices were:
- Gold - $1,535.10 – Down $29.80.
- Silver - $26.65 – Down $0.64.
![[Most Recent Quotes from www.kitco.com]](http://www.kitconet.com/charts/metals/gold/t24_au_en_usoz_2.gif)
December 28, 2011 • 21:06:44 PSTThese are all precursors to a major move and I think it could get started quite quickly.... Read With near panic in the gold and silver markets, today King World News interviewed John Embry, Chief Investment Strategist of the $10 billion strong Sprott Asset Management to get his take on where he sees gold, silver and the mining shares headed. When asked about the action in gold, Embry said, “It’s disappointing in the sense that it shouldn’t be happening. I can’t say that I’m totally surprised, you are in the quietest period of the year. These guys (manipulators) are sociopaths. They’ve basically taken the opportunity here to just take gold and silver to the cleaners in the paper market in an extraordinarily quiet period.” John Embry continues:
“A good friend of mine who has been long the paper market, on and off for the last 40 years, just sold his last contract, which tells you they are driving the paper boys out of the market. I think it’s clear the economic decay will accelerate and as a result, given the debt overload in the system, the only way that it can be supported without a total collapse, is by massive amounts of quantitative easing.
This latest thing in Europe where they trotted out 480 billion euros, call it what you will, that was pure quantitative easing. I just think we’ll see more of that going forward. The physical markets for both gold and silver are tight because of Eastern buying. What it underwrites, for sure, is the greatest percentage gains in this bull market for 2012.
I would be very surprised if gold weren’t up at least 60% from current levels. Silver will be more explosive. What they have done to silver is astounding. In the longer-run it just ensures even greater physical shortages and when that manifests itself, I think the silver price will easily double.
So I think it will be a big year next year. These (metals) are both as sold out as I can remember and the sentiment gets worse and worse, if that’s possible. These are all precursors to a major move and I think it could get started quite quickly....
“As I mentioned to you earlier, I listened to your interview with Jim Sinclair the other day and I thought he did a brilliant job of describing the situation as it is and I concur with everything he said.”
When asked about the mining shares specifically, Embry replied, “As long as they can keep the bullion prices under pressure, the shares are going to be under pressure. But they are all so inter-linked that when the bullion prices achieve the levels I think are in store for next year, the slingshot effect it’s going to have in these undervalued shares is going to be remarkable.
The key all along, as I’ve always said, is, ‘Do not have any margin in this sector because it’s open to this sort of activity (manipulation). If you don’t have any margin you are still angry because you’ve lost money on paper, but you are still intact. And if you have some extra cash lying around, what a phenomenal buying opportunity in both the bullion and the shares.
I see absolutely no problem with the HUI (Gold Bugs Index), which is (trading) just under 500, I’ve maintained 800 is an easy call and I suspect it will be a lot more than that if the gold price is homing in on $2,500.
It’s interesting, I’ve just been writing something internally here for our people. It really focuses the mind when you have to put this down for posterity. I was just going over it and when you do that exercise, the fundamentals are so compelling for gold and silver going forward. It amazes me the degree of human stupidity here, that people are parting company with the one thing that is going to save them in the future.”
© 2011 by King World News®. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. However, linking directly to the blog page is permitted and encouraged.
Gold wallows near 3-month low Italy bond sale eyed
SINGAPORE, Dec 29 (Reuters) - Gold wallowed near a
three-month low on Thursday, remaining under pressure due to a
firm dollar, while investors fretted over an important Italian
bond auction later in the day.
FUNDAMENTALS
* Spot gold edged down 0.3 percent to $1,550.90 an
ounce by 0022 GMT, on course for an 11-percent decline in
December. It hit a three-month low of $1,549.24 in the previous
session.
* U.S. gold fell 0.7 percent to $1,552.50.
* The dollar index edged higher, after its surge in
the previous session pushed down precious metals, as investors
grew increasingly nervous over a Italian bond auction scheduled
on Thursday, even after a strong sale of short-term bonds on
Wednesday.
* Spot silver dropped nearly 1 percent to a
three-month low of $26.78, after prices fell more than 5 percent
in the previous session.
* Spot platinum fell to $1,369.75, its lowest in
nearly two years, and recovered slightly to $1,370.99.
* SPDR Gold Trust, the world's largest gold-backed
exchange-traded fund, said its holdings were unchanged at
1,254.57 tonnes by Dec 28.
MARKET NEWS
* U.S. stocks fell more than 1 percent on Wednesday after a
hefty year-end rally and the S& P 500 erased gains for the year
on renewed concerns about the euro zone's financial health.
* The euro nursed heavy losses in Asia on Thursday, having
suffered a sudden drop overnight as moves were amplified in poor
year-end liquidity after stop-losses were triggered.
DATA/EVENTS
0000 Germany Preliminary CPI Dec
0900 Euro zone Money-M3 annual growth Nov
0900 Italy Business confidence Dec
1330 US Weekly jobless claims
1500 US Pending home sales Nov
Italy Bond sales
By Peter LaTonaDecember 28, 2011EUROZONE WORRIES ROCK MARKET – AGAIN The U.S. stock market fell 1 percent today, again moving into negative territory for the year. Gold and Silver prices plunged, as well, and the eurozone crisis continues to be the culprit. Last week, markets rallied on news that the European Central Bank (ECB) would provide more liquidity (cash) to eurozone banks. The hope was that banks would take this money from the ECB and buy sovereign debt, or even loan money to other banks or to businesses to stimulate the economy. That has not happened, and the markets expressed displeasure.
The eurozone banks are holding on to the money as part of their reserves. They are storing these funds in the ECB depository facility at a record pace. The eurozone banks are choosing the safety of the ECB depository rather than loaning the money for higher returns. Their lack of faith in their own markets caused a lack of confidence in today’s market action.
At 4 p.m., the APMEX precious metals prices were:
- Gold - $1,559.00 – Down $37.50.
- Silver - $27.13 – Down $1.67.
Last Updated : 28 December 2011 at 19:05 IST
One good reason why Gold is just consolidating
P. Radomski
Much has been written recently about gold's breakdown below the rising support line. But, is the technical picture forGold really bearish? No, it's not, and the chart below has been created to prove it. One of the reasons is described right on the chart - gold quite often consolidates in a way similar to what we've seen in the past months.
The key action that one should take before applying any trading technique is to check if it at least worked in the past. At this moment, you might want to take a few seconds and check the bearish gold analyses that you've read recently which include charts that cover the 10-year or at least a 5-year time frame.
Anyway, this is not the first time that we're seeing a breakdown below a rising medium-term support line. We have marked the current support with a gray, dotted line. Other gray lines represent analogous lines in the past - ones that were viewed as key support some time ago. Please take a few moments to examine them and to check what followed the previous " breakdowns" .
What followed was not a plunge that erased the whole bull market. It was not a prolonged consolidation either. The fact is that similar " breakdowns" have been (in all cases seen on the chart) followed by the final bottom of the consolidation (not to far below the line that is has broken), which was in turn was followed by a strong rally.
In these cases, lower prices were never seen thereafter!
Please, recall what we wrote in our last essay on the mixed outlook for Gold (December 14th, 2011):
In the past, when price levels did not pursue the level of the previous high, declines generally stopped close to the level of the original bottom and then rallied. This would coincide with our $1,550 target level from the bottom seen earlier this year, so there is a good chance that gold will rally if the decline takes it down this far.
This is precisely what we might be seeing now.
Based on the points made above, gold remains in a bull market from both fundamental and technical perspectives, and what we're seeing right now may be the best buying opportunity that we'll see in the coming years.
Source: sunshineprofits
Last Updated : 28 December 2011 at 19:30 IST
How will gold, silver perform in 2012?
By Commodity Online
Now it is the time of financial crisis and the commodities that continues attracting investors are Gold and silver. As the year gets to a close, only one question remain in an investor's mind.
How will gold, Silver perform in 2012?
Professional Numismatists Guild (PNG) conducted a year-end prediction amongst experts with decades of experience in buying and selling gold, silver and other bullion coins. The results unanimously point toward price increases. However, some of their opinions significantly vary on how high the increases will come about in the next three months and a year from now.
According to PNG,predictions on where gold will close at the end of the first quarter in 2012 ranged from a low of $1,475 per ounce to a high of $2,155, with a mean average of $1,759.57. Their estimates for gold at the end of 2012 varied from $1,450 up to $2,575 with the average $1,976.22. Predictions about silver in the first quarter varied from $24.35 per ounce to $57.50 with a mean average of $34.04, and from $23 to $130 with the average of $48.73 by the end of 2012.
Jeffrey Bernberg, PNG President said, " Thirty PNG member-dealers responded to the opinion poll that was conducted between December 16 to 23, 2011. These are professionals with an average of over 35 years each of frontline experience buying and selling American Eagles, Canadian Maple Leafs, South African Krugerrands and other precious metals bullion and rare coins with the public. Obviously, no one can accurately predict the precise future of the commodities markets, but many people have turned to precious metals and rare coins as an important part of their portfolios. With the uncertainty of world economic events, it is more important than ever to deal with reputable, experienced dealers when buying or selling."
PNG is a US non-profit organization composed of the country's top rare coin and bullion coin dealers.
By Ryan SchwimmerDecember 28, 2011PBOC’S HEAD OF RESEARCH: GOLD IS THE ONLY SAFE HAVENPrecious metals are trading slightly lower this morning, while U.S. stock futures and European markets are slightly higher. Short-term borrowing costs for Italian debt fell sharply from the high levels seen last month. This dose of good news is likely not a sign of things to come, as Nicholas Spiro of Spiro Sovereign Strategy explains. He added, “Given the scale of its funding requirements, there are still big concerns about Italy’s ability to get through 2012. Next quarter is going to be all about Italy.”
Zhang Jianhua, the head of the research department at the People’s Bank of China, wrote in the Financial News, a newspaper published by the People’s bank, that China should further diversify their foreign reserves through increasing its purchases of gold. He said the gold has become the only safe haven for risk adverse investors. In his article, Zhang wrote that he expected the world’s major central banks to continue pumping money into sagging economies, and this will only be favorable for gold. He also mentioned the Bank of England restarting their quantitative easing program, which adds more inflationary pressure.
The monitors from the Arab League who are tasked with observing the situation in Syria said in their initial report that they saw “nothing frightening” in Homs, the city of 1 million people which has been the epicenter of protests in the country. Some estimate that a third of the 5,000 people killed in the Syrian crisis were killed in Homs, and many independent video reports show parts of the city that resemble a warzone. The Arab League was worried that the monitors would not be allowed to search where they wanted to search during their observation, and this initial report has only supported those fears. Geopolitical tension is one of the major factors of market movement, with unease typically supporting gold prices.
At 8:02 a.m. (CST), the APMEX precious metals spot prices were:
- Gold - $1,593.60 – Down $2.90.
- Silver - $28.63 – Down $0.16..
