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
Trump and Coronavirus Pandemic Final US Catastrophe 2021 - 19th Jan 21
How To Find Market Momentum Trades for Explosive Gains - 19th Jan 21
Cryptos: 5 Simple Strategies to Catch the Next Opportunity - 19th Jan 21
Who Will NEXT Be Removed from the Internet? - 19th Jan 21
This Small Company Could Revolutionize The Trillion-Dollar Drug Sector - 19th Jan 21
Gold/SPX Ratio and the Gold Stock Case - 18th Jan 21
More Stock Market Speculative Signs, Energy Rebound, Commodities Breakout - 18th Jan 21
Higher Yields Hit Gold Price, But for How Long? - 18th Jan 21
Some Basic Facts About Forex Trading - 18th Jan 21
Custom Build PC 2021 - Ryzen 5950x, RTX 3080, 64gb DDR4 Specs - Scan Computers 3SX Order Day 11 - 17th Jan 21
UK Car MOT Covid-19 Lockdown Extension 2021 - 17th Jan 21
Why Nvidia Is My “Slam Dunk” Stock Investment for the Decade - 16th Jan 21
Three Financial Markets Price Drivers in a Globalized World - 16th Jan 21
Sheffield Turns Coronavirus Tide, Covid-19 Infections Half Rest of England, implies Fast Pandemic Recovery - 16th Jan 21
Covid and Democrat Blue Wave Beats Gold - 15th Jan 21
On Regime Change, Reputations, the Markets, and Gold and Silver - 15th Jan 21
US Coronavirus Pandemic Final Catastrophe 2021 - 15th Jan 21
The World’s Next Great Onshore Oil Discovery Could Be Here - 15th Jan 21
UK Coronavirus Final Pandemic Catastrophe 2021 - 14th Jan 21
Here's Why Blind Contrarianism Investing Failed in 2020 - 14th Jan 21
US Yield Curve Relentlessly Steepens, Whilst Gold Price Builds a Handle - 14th Jan 21
NEW UK MOT Extensions or has my Car Plate Been Cloned? - 14th Jan 21
How to Save Money While Decorating Your First House - 14th Jan 21
Car Number Plate Cloned Detective Work - PY16 JXV - 14th Jan 21
Big Oil Missed This, Now It Could Be Worth Billions - 14th Jan 21
Are you a Forex trader who needs a bank account? We have the solution! - 14th Jan 21
Finetero Review – Accurate and Efficient Stock Trading Services? - 14th Jan 21
Gold Price Big Picture Trend Forecast 2021 - 13th Jan 21
Are Covid Lockdowns Bullish or Bearish for Stocks? FTSE 100 in Focus - 13th Jan 21
CONgress "Insurrection" Is Just the Latest False Flag Event from the Globalists - 13th Jan 21
Reflation Trade Heating Up - 13th Jan 21
The Most Important Oil Find Of The Next Decade Could Be Here - 13th Jan 21
Work From Home £10,000 Office Tour – Workspace + Desk Setup 2021 Top Tips - 12th Jan 21
Collect a Bitcoin Dividend Without Owning the King of Cryptos - 12th Jan 21
The BAN Hotlist trade setups show incredible success at the start of 2021, learn how you can too! - 12th Jan 21
Stocks, Bitcoin, Gold – How Much Are They Worth? - 12th Jan 21
SPX Short-term Top Imminent - 12th Jan 21
Is This The Most Exciting Oil Play Of 2021? - 12th Jan 21
Why 2021 Will Be the Year Self-Driving Cars Go Mainstream - 11th Jan 21
Gold Began 2021 With a Bang, Only to Plunge - 11th Jan 21
How to Test Your GPU Temperatures - Running Too Hot - GTX 1650 - Overclockers UK - 11th Jan 21
Life Lesson - The Early Bird Catches the Worm - 11th Jan 21
Precious Metals rally early in 2021 - 11th Jan 21
The Most Exciting Oil Stock For 2021 - 11th Jan 21
Financial Market Forecasts 2021: Navigation in Uncharted Waters - 10th Jan 21
An Urgent Message to All Conservatives, Right-Wingers and Patriots - 10th Jan 21
Despite Signs to the Contrary, Gold Price at or Near Top - 10th Jan 21 -
Ultimate Guide On The 6 Basic Types Of Index Funds - 10th Jan 21
Getting Vaccinated at TESCO - Covid-19 Vaccinations at UK Supermarket Pharmacies and Chemists - 10th Jan 21
Cheers for the 2021 Stock Market and These "Great Expectations" - 9th Jan 21
How to Plan Your Child With Better Education - 9th Jan 21
How To Find The Best Casino - 9th Jan 21
Gold Is Still a Bargain Buy - 8th Jan 20
Gold Price Set to Soar as Hyperinflation Looms - 8th Jan 21
Have Big Dreams? Here's How to Pay for Them - 8th Jan 21
Will the Fed Support Gold Prices in 2021? - 8th Jan 21
Stocks trading strategies for beginners - 8th Jan 21
Who is Buying and Selling Stocks in 2021 - 8th Jan 21
Clap for NHS Heroes 2021 as Incompetent Government Loses Control of Virus Again! - 8th Jan 21

Market Oracle FREE Newsletter

FIRST ACCESS to Nadeem Walayat’s Analysis and Trend Forecasts

Gold Falls on Cautious QEII Report, Silver Spike Manipulation Statement

Commodities / Gold and Silver 2010 Oct 27, 2010 - 07:54 AM GMT

By: Adrian_Ash

Commodities

Best Financial Markets Analysis ArticleTHE PRICE OF GOLD slipped back to last week's finish below $1330 an ounce in London on Wednesday, as the US Dollar rallied after a Wall Street Journal report said the Federal Reserve will be more cautious-than-expected in next week's hotly-anticipated asset purchase program – also known as QEII.

Crude oil contracts fell for the first time since Friday. Emerging-Asia stock markets lost 0.8%.


"Despite [last week's] setback" in gold prices, says Wolfgang Wrzesniok-Rossbach in his Precious Metals Weekly for German refiner Heraeus, "a real change in trend is presently not foreseeable.

"A large dip would be just a fresh opportunity to enter the market again, as the generally positive environment [for gold investors] should hold for the time being. It will change one day, when global interest-rate policies change."

Buying only Treasury bonds, rather than commercial debt, the Fed will target 2- to 10-year maturities according to the WSJ – which cites "interviews with some officials" – dripping new money into the bond market rather than unveiling its total package all at once.

"Imported inflation caused by out-of-control Dollar printing and skyrocketing commodity prices is hitting China hard," the People's Daily today quotes Chinese commerce minister Chen Deming, speaking at a trade fair in southern China.

The People's Bank of China today cut the Yuan's official exchange rate to a 1-month low, down 0.3% from Tuesday.

Last weekend's G20 meeting only "bought some time" before the US Congress will join the Senate in calling China a "currency manipulator", says a senior China analyst quoted by Reuters today.

"Doubtlessly, if the Yuan is set to become an international currency like the Dollar or the Euro, China has to get a huge gold reserve to support it," says Meng Qingfa, a researcher at the China Chamber of International Commerce, quoted by the International Business Daily – the official newspaper of Beijing's Ministry of Commerce.

"A reserve of 1,054 tonnes [of gold] is far from being enough."

Buying gold around $1300 an ounce, says Meng, the fast-growing Asian economy could match Washington's 8,000-tonne gold reserves by using 10% of its $2.65 trillion in foreign currency holdings.

Elsewhere on Wednesday, South Korea reported a sharp slowdown in its economic growth, while broad money-supplies across the 16-nation Eurozone slipped to 1.0% in Sept.

US mortgage applications showed a rally for last week, bouncing from early Oct.'s sharp decline.

The Euro fell to a 1-week low beneath $1.38, holding the gold price for French, German and Italian investors above €30,900 per kilo.

British investors wanting to buy gold today saw the wholesale-market price slip back below £840 an ounce – a record-high when crossed in May this year, now some 3.5% off the record price hit in late June.

In Dollar gold prices, "Only a weekly close above the $1400 level would change our currently medium-term toppish outlook," says Axel Rudolph in his latest Technical Outlook for Commerzbank, "this week at least."

Looking at the ratio of gold to silver prices – a measure of relative strength in the two precious metals' prices – the current reading of 55.92 "is only marginally above major support" says Rudolph, citing "the March-to-July 2008 consolidation zone and the 2006-2010 uptrend line [now] at 52.24.

"This we expect to stop the current tumble in the ratio, at least temporarily" – meaning a pause in silver's outperformance of gold prices.

Silver rose late Tuesday to a 1-week high at $24.25 per ounce – matching and extending gold's overnight action – following a statement from US regulator Bart Chilton that he wants the Commodity Futures Trading Commission to prosecute "repeated...fraudulent" but so far un-named "efforts to persuade and deviously control" silver prices.

"Silver option-related buying hit [electronic trading platform] Globex as soon as it opened this morning," says one Hong Kong dealer in a note.

But the silver price quickly fell back in Asian trade this morning, dropping 3.1% by the time London opened for business as selling "snowballed" despite a Wall Street Journal report that said CFTC lawyers have interviewed employees of J.P.Morgan – commonly cited by anti-manipulation lobbyists as holding a "disproportionately" large short position in silver futures after it acquired the stricken Bear Stearns investment bank in March 2008.

"Based on the breadcrumbs that Bart Chilton has given us," the Financial Times quotes UBS strategist Edel Tully – the only major-bank analyst to comment so far – "it's hard to see what impact [his statement] could have on the market.

"[Not] unless the CFTC says the manipulation is ongoing, which we don't see evidence of."

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 2010

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