Precious Metals Rebound
This week thus far has brought back the glimmer to the gold and silver markets as news from the European Union has given the precious metals added appeal to investors. Most analysts agree the recent U.S Dollar rally is due more to the weakness of the Euro. The U.S Stock Futures rallied as European Union Leaders agreed to aid Greece with their budget deficit crisis. European Union President Herman Von Rompuy stated “Euro area member states will take determined and coordinated action if needed to safeguard financial stability in the Euro area as a whole. We fully support the efforts of the Greek government and their commitment to do whatever is necessary including adopting additional measures”
This action from the European Union will give much needed confidence to the European Banking and Stock markets therefore firming up the Euro versus the Dollar.
The U.S Labor department announced that fewer American than expected filed claims for unemployment insurance as jobless applications declined from 483,000 to 440,000. This prompted a Labor Department Spokesman to say “The current figures signal a return to a more normal level of claims”.
The demand for physical Gold has been insatiable in China as the Chinese New Celebration begins this weekend. Gold has become the gift of choice in recent years as their ever growing middle class prefer to purchase tangible assets as “gifts” instead of cash.
As of this post Comex gold is flirting around the $1100.00 level again as the recent European Union decision has heighten the appeal for gold and sent the ‘bears “ scrambling as resistance levels have been falling by the wayside.
The U.S Dollar has been benefiting from the Euro weakness the past several months rather than any real strength of its own. Recently the Euro traded at an eight month low versus the U.S Dollar… The global debt crisis will continue to determine the direction of the both the gold and silver markets. Expect the volatile and choppy markets to continue.
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