Most Popular
1. It’s a New Macro, the Gold Market Knows It, But Dead Men Walking Do Not (yet)- Gary_Tanashian
2.Stock Market Presidential Election Cycle Seasonal Trend Analysis - Nadeem_Walayat
3. Bitcoin S&P Pattern - Nadeem_Walayat
4.Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun - Nadeem_Walayat
4.U.S. financial market’s “Weimar phase” impact to your fiat and digital assets - Raymond_Matison
5. How to Profit from the Global Warming ClImate Change Mega Death Trend - Part1 - Nadeem_Walayat
7.Bitcoin Gravy Train Trend Forecast 2024 - - Nadeem_Walayat
8.The Bond Trade and Interest Rates - Nadeem_Walayat
9.It’s Easy to Scream Stocks Bubble! - Stephen_McBride
10.Fed’s Next Intertest Rate Move might not align with popular consensus - Richard_Mills
Last 7 days
Stock Market Bubble 2025 - 11th Feb 25
Fed Interest Rate Cut Probability - 11th Feb 25
Global Liquidity Prepares to Fire Bull Market Booster Rockets - 11th Feb 25
Stock Market Sentiment Speaks: A Long-Term Bear Market Is Simply Impossible Today - 11th Feb 25
A Stock Market Chart That’s Out of This World - 11th Feb 25
These Are The Banks The Fed Believes Will Fail - 11th Feb 25
S&P 500: Dangerous Fragility Near Record High - 11th Feb 25
Stocks, Bitcoin and Crypto Markets Get High on Donald Trump Pump - 10th Feb 25
Bitcoin Break Out, MSTR Rocket to the Moon! AI Tech Stocks Earnings Season - 10th Feb 25
Liquidity and Inflation - 10th Feb 25
Gold Stocks Valuation Anomaly - 10th Feb 25
Stocks, Bitcoin and Crypto's Under President Donald Pump - 8th Feb 25
Transition to a New Global Monetary System - 8th Feb 25
Betting On Outliers: Yuri Milner and the Art of the Power Law - 8th Feb 25
President Black Swan Slithers into the Year of the Snake, Chaos Rules! - 2nd Feb 25
Trump's Squid Game America, a Year of Black Swans and Bull Market Pumps - 24th Jan 25
Japan Interest Rate Hike - Black Swan Panic Event Incoming? - 23rd Jan 25
It's Five Nights at Freddy's Again! - 12th Jan 25
Squid Game Stock Market 2025 - 5th Jan 25

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Weak U.S. Jobs May Mean More Money Printing and Higher Gold and Silver Prices

Commodities / Gold and Silver 2012 Jul 07, 2012 - 12:36 AM GMT

By: Jeb_Handwerger

Commodities

Gold (GLD) is consolidating after hitting a two-week high. Investors are witnessing renewed strength in precious metals after the Fed announced the expansion of Operation Twist until at least the end of the year.


Similarly, gold and silver (SLV) have been recently moving higher based on the eurozone and stocks are breathing a sigh of relief as the summit came up with a purported solution to reduce funding costs, particularly for Italy and Spain, worth $149 billion. This may stimulate the eurozone. In addition, precious metal investors appear to be optimistic as the European Central Bank, Bank of England and the People's Bank of China concurrently ease interest rates to stimulate global growth in the depressed eurozone, which is experiencing record unemployment. So optimism is returning to Europe while the U.S., which has heretofore been a safe haven, is beginning to show signs that unemployment may be lurking higher.

U.S. jobs data on Friday was lackluster. Weaker numbers going into the election could once again restart discussion of QE3. A possible coordinated stimulus by the ECB and China could be a catalyst for fund managers and traders returning from their 4th of July holiday vacation.

This week should be quiet but next week could be exciting, especially if we witness this worldwide coordinated effort to stave off a pandemic meltdown before the 2012 U.S. presidential election.

Over the past three years we have seen positive reversals in gold bullion in the summer months. The second half could represent an explosive move in the yellow metal as a coordinated worldwide stimulus begins. Nations such as Japan, EU, England and the U.S. are attempting to devalue their currencies in order to create growth and payoff soaring debts. Austerity is unpopular and the only solution is to continue to monetize the debt.

Gold is regaining the 50-day moving average at $1600 and $1640 would be the next area of resistance. Traders are looking to see if silver gets to $29 regaining the 50-day moving average and breaking the four-month downtrend to the upside. Gold is moving into the favorable third quarter, which has proven the past three years to make powerful reversals higher. This may also benefit the wealth in the earth undervalued gold producers (GDX) and the bargain-priced junior explorers (GDXJ) which are hitting multi-year lows.

In conclusion, increasing amounts of money is being printed worldwide. Inflation may be the only recourse for governments in trouble. We raise an unimaginable consideration. Could it be that the bankers and Federal Reserve Board eventually must devalue the dollar to keep pace with other nations to pay off soaring debts? We are fully aware that such a scenario might exist somewhere down the fiat paper road. Just a thought.

Subscribe to my free newsletter to get up to the minute updates on rare earths, uranium, gold and silver.

By Jeb Handwerger

http://goldstocktrades.com

© 2012 Copyright Jeb Handwerger- All Rights Reserved
Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2022 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