Gold

February 19 2013 10:09 AM

GOLD PRICE NEWS – The gold price traded near unchanged Tuesday morning at $1,609 per ounce. Gold prices have moved lower in recent weeks, punctuated by last week’s 3.7% decline. The sell-off has been driven by heavy selling in the futures markets on the back of the perception that the U.S. economy is healing. Investors are beginning to price in the end of the Federal Reserve’s quantitative easing program despite the fact that growth remains subdued. Also helping to fuel selling and drive the price of gold lower is the news that high-profile institutional investors George Soros and Julian Robertson reduced their stake in SPDR Gold Trust (GLD) in the fourth quarter of 2012.

February 15 2013 1:26 PM

The price of gold suffered a decline in the fourth quarter of 2012 from $1,800 to $1,650 an ounce. However, several well-known hedge funds are still maintaining exposure to the safe-haven asset. Late Thursday, many institutional investment managers filed their mandatory 13-F with the Securities and Exchange Commission. The 13-F is a quarterly report of equity holdings required by managers that oversee more than $100 million in qualifying assets. The form must be filed within 45 days of the end of each quarter. The 13-F provides a peek at what hedge funds did in the previous quarter, but investors should keep in mind that hedging and trading strategies of each fund are still unknown.

February 15 2013 4:47 AM

Lately we’ve been writing about the negative correlation between the equity market and the precious metals market. This phenomenon has been in place since summer 2011 and has re emerged in the past few months. Since November 23, the S&P 500 is up 8% while the gold shares are down 14%, Silver has lost 11% and Gold 7%. For those who have studied history this should not come as a total surprise. From 1972 to 1977 and November 2000 to July 2002, precious metals and the equity market trended in opposite directions. We’ve postulated that precious metals and the mining shares won’t begin a new bull phase until the cyclical bull market in US equities ends. We don’t expect that to happen immediately but there are some important signals beneath the surface (with the safe-havens) that we should direct our attention to.

February 14 2013 1:49 PM

The recent price action of gold may lead some to believe the precious metal has fallen out of favor with the market, but central banks across the globe continue to love the safe-haven metal. While some central banks print money in historic amounts, others are buying gold. According to the World Gold Council’s latest report, central banks purchased 145 tonnes of gold in the fourth quarter of 2012, the highest quarterly haul since the sector became net buyers in 2009. For the entire year, central bank buying surged 17 percent to 534.6 tonnes, the highest annual total since 1964. In comparison, central banks bought 456.8 tonnes in 2011.

February 14 2013 9:23 AM

The euro area recession deepened and data showed that the euro area economy shrank the most since 2009 and its three biggest economies, Germany, France and Italy, suffered slumping output.

February 14 2013 4:40 AM

Spot Gold fell just short of 1656/57 resistance where we expected a top. We have now retested the 1641/39 support & bounced as hoped, so we have a small bottoming pattern which should push us higher in to the end of the week. First target is 1649/50 then yesterday’s high at 1653. Above here today we look for a test of 1656/57 resistance & a high for the day. However a break higher tomorrow is possible for 1661. A push above here then targets 1666 resistance & a selling opportunity.

February 13 2013 4:17 AM

The printing of more paper money usually has the effect of debasing or diluting the strength of that particular currency. The lowering of interest rates also renders a currency less attractive to investors as better returns might be available elsewhere. The demise of the US Dollar can be attributed, in part, to both of the above reasons. However, when this debasement is plotted against other currencies as per the US Dollar Index we can see that it is having some difficulty when it comes to heading lower as the chart below depicts.

February 12 2013 9:26 AM

Gold has dropped to its lowest level in over a month on low volumes due to Asia’s Lunar New Year holiday which has markets closed in Hong Kong, China, Malaysia and Taiwan today. Prices remained low despite the announcement that North Korea had detonated an atomic warhead in its 3rd underground nuclear test. Geopolitical risk remains and should the situation on the Korean peninsula deteriorate then gold should receive a safe haven bid.

February 11 2013 10:15 AM

Ron Paul spoke with Bloomberg television (see video in Commentary) and said that we are in a currency war and we have been for decades. He noted that governments have always competed against each other’s currencies even under Bretton Woods. It has always been a form or protectionism and will make people want to export more.