Gold Price - Where is it heading?

[sinner]

We have broken through the psychologically important 900 level tonight.

No technical chart for this post since all the rules are still in play. We need to see buyers move in at this point or the trading channel will be broken and we will probably go to fill the 850 gap (as I have mentioned previously).

Trembling Hand, still unsure if I miscommunicated to you or what as you haven't clarified your question. Apologies for my poor internet communication skills.

I have worked 60 hours in 5 days.

Bedtime.

 

[projack]

He also claims quantitative easing as another reason gold will go up, but he cannot explain this measure at all or the mechanisms behind it or why any of this has any relation to gold whatsoever. This unchecked and willful ignorance sickens me. How can you claim quantitative easing will cause gold price to go up when every word you spout shows you don't even know what quantitative easing is or how it works.

Anyone can explain what quantitative easing is?
Some of us asking if quantitative easing is;

Payment of the last resort in a Ponzi-scheme economy? (Consumer debt was counted as a deposit by the bank that conjured the money, and they added that amount to their reserves to lend 9 times that amount!)
Robbing Peter to pay Paul?
Perfume that will help the smell for a little while but at the end of the day the stink is too much for our thought to be artistic masterpieces to remain displayed on our walls?

Some people think it is humorous,
http://www.thedailymash.co.uk/news/business/king-unveils-radical-plan-to-****-britain-into-middle-of-next-week-200903061625/
but some see it tragically.
http://www.guardian.co.uk/world/vide...tarvation-food

 

[doctorj]

UBS estimate potential upside in gold of USD2,500/oz - UBS report available in post #35 here https://www.aussiestockforums.com/forums/showthread.php?t=14387

 

[michael_selway]

UBS estimate potential upside in gold of USD2,500/oz - UBS report here https://www.aussiestockforums.com/forums/showthread.php?t=14387

Yep looks good

http://money.ninemsn.com.au/article.aspx?id=769646
http://www.commodityonline.com/news/Gold-to-hit-$1-500-Silver-to-zoom-to-$25-15876-3-1.html

UBS recommendation fails to lift gold

By Javier Blas in London , Financial Times, 10 Mar 2009

UBS told investors on Tuesday to increase the weight of gold in their portfolios, warning that bullion prices could soar because the prospects of either deflation or inflation were "becoming more extreme".

The Swiss bank, one of the most active gold dealers, warned of "a potential upside of $2,500 an ounce" as some hedge fund investors who made money last year by betting against investment banks are now buying gold as a way of betting against central banks.

"The current environment is one which can best be characterised as having a 'low margin of error' for central bankers; with the prospects for deflation or inflation as becoming more extreme," said Daniel Brebner, an analyst at UBS in London.

"Given the broad uncertainties in the current macro climate we believe that investors should look to gold given its historic tendency to act as a hedge against these risks."

In London, spot gold prices on Tuesday were lower as jewellery demand, traditionally the backbone of gold consumption, remained lacklustre.

Bullion fell to $910 a troy ounce, down from Monday's last quote in New York of $920.95 an ounce.

A bet on gold is essentially a bet against all paper currencies. The gold bulls include David Einhorn, founder of hedge fund Greenlight Capital, who last year came under the spotlight for his short selling of shares in Lehman Brothers, after arguing that the bank did not have enough capital to offset its exposure to falling property prices. Other funds looking at gold include Eton Park and TPG-Axon, investors said.

UBS said that downside risks to gold prices were limited to about $500 an ounce, or less than 50 per cent below the current price, while the upside risk was for a surge of 170 per cent above current prices, to trade at $2,500 an ounce.

Other commodities markets were mostly higher on Tuesday, with oil consolidating its recent gains. Nymex April West Texas Intermediate rose 56 cents to $47.63 a barrel while Brent moved 99 cents higher to $45.12 a barrel.

Olivier Jakob, of Swiss-based consultancy Petromatrix, said that while WTI continued to make a steady advance upwards, it was starting to enter the stronger resistance area of the $50 mark and the technical level of the 100 day moving average at about $48.

In spite of the rise in oil prices, natural gas prices moved lower. Nymex April natural gas fell to $3.826 per million British thermal unit, down 3.9 cents on the day. On Monday, natural gas prices hit an intraday low of $3.809, the lowest since late 2002.

On the London Metal Exchange, base metals were mixed, with copper, the bellwether of the sector, posting a 1 per cent increase on the day to $3,600 a tonne. Copper stocks at LME warehouses fell 3,325 tonnes to 518,700 tonnes, continuing the downward trend seen in the past 10 days.

Agriculture commodities moved higher ahead of this week's monthly report on supply, demand and inventories from the US department of agriculture. CBOT March corn rose 3 cents to $3.60 ¼ a bushel while CBOT March soyabean rose 11 ½ cents to $8.92 ½ a bushel. The rise was capped by concerns about the economic crisis impact on agriculture commodities consumption, particularly in the livestock sector.

 

[GumbyLearner]

Anyone can explain what quantitative easing is?
Some of us asking if quantitative easing is;

Payment of the last resort in a Ponzi-scheme economy? (Consumer debt was counted as a deposit by the bank that conjured the money, and they added that amount to their reserves to lend 9 times that amount!)
Robbing Peter to pay Paul?
Perfume that will help the smell for a little while but at the end of the day the stink is too much for our thought to be artistic masterpieces to remain displayed on our walls?

Some people think it is humorous,
http://www.thedailymash.co.uk/news/business/king-unveils-radical-plan-to-****-britain-into-middle-of-next-week-200903061625/
but some see it tragically.
http://www.guardian.co.uk/world/vide...tarvation-food

Quantitative easing explained in 108 seconds.
http://news.bbc.co.uk/2/hi/business/7924506.stm

 

[sinner]

Hi guys,

I am going to visit my parents tonight. Should be fun.

Am I allowed to try and make a forecast for tonight?

920 then 882ish.

Commentary when I get home.

 

[solomon]

I seem to remember 880 being a significant technical level on the recent way up to $1000 and so it is probably significant on the way down. If we break 880 it could be very bearish.

 

[sinner]

Sorry yes, I wanted to add there is a probability of a 50% retrace to fill the 850 gap.

 

[sinner]

Bit fat invalidation of my forecast last night in the second half of COMEX trading last night with a bounce up but no close above the 23.6% Fib retrace.

What does this mean? Despite my earlier ranting about the HUI and other gold sector indices, I neglected to examine them since and didn't consider them in the forecast.

Others with a bit more brains than me kept a close watch, Chris V forecast still pretty damn good! Thinking about subscribing.

From
http://www.safehaven.com/article-12811.htm

 

[sinner]

Hi guys,

Is it just me in here now?

We are seeing some volatility in gold again tonight, similar to the pre-NYMEX action on the 7th March.

Lows to highs (range) for last 4 1h bars:

2300: 925 - 939
0000: 928 - 936
0100: 921 - 931
0200: 926 - 930

Does anyone have any volume data for these periods on the futs? Trembling Hand I am once again looking in your direction. Are these just big orders in low liquidity?

 

[CapnBirdseye]

Hi guys,

Is it just me in here now?

No not at all, just reading and learning until I feel I can properly contribute.

Gold equitites seem to be making some good gains over the last few days on what has been a pause at around $910/oz. Have gold equities been oversold or is this speculation based on the support above $900/oz?

 

[Beej]

Hi guys,

Is it just me in here now?

We are seeing some volatility in gold again tonight, similar to the pre-NYMEX action on the 7th March.

Lows to highs (range) for last 4 1h bars:

2300: 925 - 939
0000: 928 - 936
0100: 921 - 931
0200: 926 - 930

Does anyone have any volume data for these periods on the futs? Trembling Hand I am once again looking in your direction. Are these just big orders in low liquidity?

Data for April Gold futures contract:

2300: 15769 contracts
0000: 8889
0100: 14325
0200: 4682

~21,500 individual trades, giving an average transaction size of 2 contracts.

Cheers,

Beej

 

[solomon]

It seems that PoG and gold stocks are again moving in tandem with the equities rally. This is unusual, though I seem to remember it happened before the recent break above $1000, so perhaps we are heading for a short equities rally before another wave of bad news and equities selling. While PoG breaks again to the upside.

 

[sinner]

Thanks Beej (although I did not expect to see you in here)!

Is gold rally with equities unusual? I don't think so. Isn't that how we got to the first 1000 then tumble?

We should watch the HUI closely over the next few days. There is a lot of technical damage there but if we can move past it we might finally see the index confirm golds recent "golden cross" move up.

Saturday night, time for some fun!

 

[Uncle Festivus]

I'm actually a bit nervous and have been selling down some gold equities. Don't know why, just doesn't feel right, hope I'm wrong? Could go either way now on the weekly XAU?

 

[CanOz]

Interesting you say that UF, i was just saying in another thread that i have seen heaps of bearish patterns in US Stocks today...Quite a few were gold stocks too. I'm not sure why, but i had the urge to ignore them until you posted this.

Again, I'll post a couple if i have time.

Cheers,


CanOz

 

[Glen48]

To day's Sunday Mail reports how Gold is in such demand the Mints can't keep up with the market which means it should continue to dive.

 

[Uncle Festivus]

Has the rest of the world seen the US ponzi scheme for what it is, finally?

SAN FRANCISCO (MarketWatch) - A big jump in foreign sales of long-term U.S. securities raised concerns Monday that the U.S., in the midst of a massive debt issuance to fund its economic revival plans, may run into trouble getting other countries to finance its deficit.

Foreign purchases of long-term U.S. Treasurys, Fannie Mae and Freddie Mac bonds, corporate debt and stocks -- netted for acquisitions of foreign debt from U.S. residents -- dropped to negative $43 billion in January from positive $34.7 billion in December, said the Treasury Department Monday.
January's sales marked a record low, said currency strategist Michael Woolfolk, and the reasons for the plunge could spell bad news for the U.S. dollar.
"This was a truly awful report, throwing into question the funding of the U.S. current account deficit," said Woolfolk, senior currency strategist at the Bank of New York Mellon, in emailed comments.

So we could have the situation of rising US bond and corporate rates at the same time as a flight from 'quality' from the USD, ie a reversal of the current trend to US bond 'quality'? Gold still waits patiently for hell to break loose Version 2? We aint seen nothin yet.....not sure what gold equities will do in the break down......when a snowball becomes an avalache....

Combine that with the broad negative sentiment for gold and we have the perfect recipe for a sharp bullish move for gold - something not many are expecting?

 

[CapnBirdseye]

Interesting UF. But if the dollar is falling and gold is quoted in USD, doesnt this potentially offset some or all of the gains in gold?

 

[sinner]

Do you really think the AUD will ever come close to parity with the USD again? I doubt it.

If USD starts to fall dramatically, gold will be priced in whatever becomes the next reserve currency.