Gold Price - Where is it heading?

[hobo-jo]

Incidentally they didn't threaten to storm the embassy.

Well they didn't use those words, but they did claim they could arrest him in the Ecuadorian Embassy: http://rt.com/news/assange-arrest-asylum-780/ And the police force they'd amassed at the building suggested they might be preparing to do so.

To be honest I would be more worried about Swan telling the RBA to sell the Gold to meet the deficit gap... there's no reason to keep our Gold in London unless planning to sell or lease it.

 

[banco]

Well they didn't use those words, but they did claim they could arrest him in the Ecuadorian Embassy: http://rt.com/news/assange-arrest-asylum-780/ And the police force they'd amassed at the building suggested they might be preparing to do so.

To be honest I would be more worried about Swan telling the RBA to sell the Gold to meet the deficit gap... there's no reason to keep our Gold in London unless planning to sell or lease it.

I assume the costs of securing that much gold are not insignificant and it's cheaper to outsource the security to the brits who through economies of scale presumably have lower security costs.

 

[Uncle Festivus]

http://www.professorfekete.com/articles\AEFAmericanBasesGermanyGoldBasis.pdf

 

[notting]

One of the problems with the above article is that it assumes gold has an inherent value.
It doesn't.
Just as the paper we swap with each other for goods and services doesn't.
Goods and services are of value as they are required.

The interesting point that Obama made about the US and Euro free trade agreements being made even more robust was a direct show of strength to those not playing by the rules like China who have created this whole currancy issue with their currancy manipulation which has been going of for decades now.
What the US and Europe are doing is dealing with the consequencies of this Chinese attack as the consequences become too problematic to ignore.

Gold hit a low of $1,596.70 George Soros cut his holdings in the SPDR Gold Trust, the world's largest gold exchange-traded fund, by more than half in the fourth quarter.
Investment fund PIMCO and Tiger Management's Julian Robertson, dissolved his entire stake in Market Vectors Gold Miners ETF.

GLD's biggest shareholder John Paulson is rumoured to be stuck with his pants down in this trade and some say the sharks are feasting on this floundering whale.

With the US$ looking to be stronger against the Euro given the worse than expected recession figures that came out of Euroland during the week, Gold will suffer as it's biggest influence is the US value against the Euro. So if the US$ goes up against the Euro then gold tends to go down with it!

The good thing for ausi miners is that the AU is alse weakening against the US which should stabalise Ausi miners but unfortunatly it doesn't seem to make any difference and they all go down with the price of US$ gold.

All this has been exagerated by the fact that there is little demand from Asia with the New Years holidays but the fact that gold has remained below it's 200day moving average for 6 days now is a very bearish signal.

 

[tinhat]

Gold price dipped again last week. The down-trend continues with a bearish outlook. I should have held off buying SLR which I did last week. Might need to get out of that one in the ST.

As for demand for gold, quite frankly, demand for jewellery is more important than central bank buying (of tungsten filled gold bars to add to their phantom stockpiles) and of course depreciation of currencies is going to increase the price of hard commodities in those currencies. So, we need to see continued recovery in India and China to see the demand for gold pick up IMHO.

 

[zac]

So everyone seems to still be bearish Gold.
Ive been following a blog thats been relatively accurate. They have been short from 1671 and expected it to drop to 1600 - 1590.
Amazingly lastnight it did just that.
They are now bullish yet in the next few days if it goes under 1590 expect 1530-1540 Major Resistance level to be reached.

So in my view im short term view im Long and my Longer term view (multi month/year) im bullish.
Yet im not surprised if it drops to 1530-1540 and see that as a golden buying opportunity if that level is breached.

I will be gob smacked if it dropped under 1520 / 1500.

 

[tinhat]

So everyone seems to still be bearish Gold.
Ive been following a blog thats been relatively accurate. They have been short from 1671 and expected it to drop to 1600 - 1590.
Amazingly lastnight it did just that.
They are now bullish yet in the next few days if it goes under 1590 expect 1530-1540 Major Resistance level to be reached.

So in my view im short term view im Long and my Longer term view (multi month/year) im bullish.
Yet im not surprised if it drops to 1530-1540 and see that as a golden buying opportunity if that level is breached.

I will be gob smacked if it dropped under 1520 / 1500.

What's the blog? PM me if you don't want to say on the forum.

 

[notting]

So, we need to see continued recovery in India and China to see the demand for gold pick up IMHO.

You want to also be mindful of the new %5 duty placed on gold by the Indian administration to try to curb the mass selling of the rupee to buy gold to hedge against the rupees weakening.

The Easterners will have a bit of a buying spree when they get back from holidays but it will just be a bit of a spike I reckon.
.
If US bond markets deflate which is also on the cards it will be even worse for gold.

 

[zac]

.
If US bond markets deflate which is also on the cards it will be even worse for gold.

Why?
If you mean due to rising interest rates then yes I agree, but remember bond markets will deflate if there are inflationary risks too as it will mean rising interest rates.
So it can be a double edged sword in that regard so I half agree with your comment.
If you look at yields of treasuries when Gold was at its peak, they were far higher than they are now. Not that this should be seen as any correalation at all.

 

[pixel]

So everyone seems to still be bearish Gold.
Ive been following a blog thats been relatively accurate. They have been short from 1671 and expected it to drop to 1600 - 1590.
Amazingly lastnight it did just that.
They are now bullish yet in the next few days if it goes under 1590 expect 1530-1540 Major Resistance level to be reached.

So in my view im short term view im Long and my Longer term view (multi month/year) im bullish.
Yet im not surprised if it drops to 1530-1540 and see that as a golden buying opportunity if that level is breached.

I will be gob smacked if it dropped under 1520 / 1500.

I have little doubt about the low 1500's, zac.
This is what I posted yesterday across the road:
Right now, the weekly chart suggests more downside: $1608 before end of March; $1530 within the next 9 months. If the 1520/1530 support fails, we'll be in for quite a rude shock in 2014-15 with targets sub $1150.

but seeing that the 1608 have already been broken last night, I could be wayyy off with my timing. In that case, all my time estimates may need to come closer together.

 

[cogs]

zac,

So pretty much std fibs they chose on the blog?

Gold does seem to work quite well with fibs.

 

[zac]

If the 1520/1530 support fails, we'll be in for quite a rude shock in 2014-15 with targets sub $1150.

While the 1500 level may be breached, I cant ever see it reaching $1150,
You havent taken into consideration production costs of Gold.

 

[qldfrog]

While the 1500 level may be breached, I cant ever see it reaching $1150,
You havent taken into consideration production costs of Gold.

Since when has the price of a resource anything to do with the production cost, at least temporarily???

I am not a gold denier, but selling at a loss has occurred veru frequently in the commodity ,market or even for agricultural product:
once a mine is built or a crop planted, it might be less expensive to sell at a loss that doing a full closure + human is an unstoppable hope addict: she wiull be right , it will get better soon.
I have goild, and do not see it collapsing that far, but the production cost is a non issue initially[ obviously, 5 years down the track, with no new mine, closed ones, etc etc a resource will start to get a better price but in the meantime..)
my 2c worth only

 

[zac]

Since when has the price of a resource anything to do with the production cost, at least temporarily???

Hmmm, thats the beauty of commodities, their price will never go to zero.
I know with agricultural products as they are perishable they may be sold under production costs. Having grown up on a farm that happened a lot.

I cant think of a time Oil for example has gone under production costs,
Having said that different countries have different production costs, but Oil is very unlikely to get under $75 barrel again due to the supply issue it causes as it goes under production costs for one country in particular.

in 2008, production costs for Gold was $250 Oz but its soared since then for a number of reasons. I cant see why a gold producer will ever sell it for less when they can slow production or start stock piling.

 

[pixel]

I cant see why a gold producer will ever sell it for less when they can slow production or start stock piling.

When they've got interest to pay on debt, they may have no choice but to sell at whatever the market pays at the time. Remember VRE or CRS?

 

[burglar]

When they've got interest to pay on debt, they may have no choice but to sell at whatever the market pays at the time. Remember VRE or CRS?

I remember Croesus (CRS)!
They had more trouble than you could shake a stick at.
Rumour has it, that stealing ore was rife.

It didn't help that they had a hedge book!

 

[FlyingFox]

You want to also be mindful of the new %5 duty placed on gold by the Indian administration to try to curb the mass selling of the rupee to buy gold to hedge against the rupees weakening.

The Easterners will have a bit of a buying spree when they get back from holidays but it will just be a bit of a spike I reckon.
.

I agree with you earlier comment about gold having no intrinsic value but that is true of any object that is used as money without another purpose.

Hence the value of gold will always be tied to the perception of it's value by the populace at large. While the west has been weaned off of precious metals, this is certainly not the case in the east.

The import of gold is proving to be a real problem for the government hence the tax but this will do little to change the perception of the people while they fear currency devaluations and banks. Moreover if the government pushes the issue, they might soon be out the door. Telling an Indian that you should not own gold is like telling a card carrying member of the NRA that they can't own guns.

Another reason for the popularity of Gold there is that it is such a compact store of wealth and in a country where tax evasion and corruption is strife, gold will always have a demand. If they fix all these, then the demand may drop.

The real game changer for me is what is (will) China doing with their gold reserves. Already heard some high level officials saying they want to have much larger reserves. If/when they announce their new reserves and depending on the change expect that to have a impact on prices.

 

[Edwood]

 

[brerwallabi]

I like charts they show where the price has been, sometimes its necessary to look at a chart over a longer period of time to get the true direction of a stock or commodity. The gold chart over the short period covered Edwood clearly shows a downtrend and I guess you can apply many different indicators and they will also show short term trend strength confirmation.
A larger picture of gold will show that the long term trend still holds, there are factors in play to drive gold down to its current level. Little forays below some technical points are deliberate and are such to shake out the weak hands.
Me. yes I went short indicators provided that information. I am though ready to go long again.
There is no criticism of your chart a nice piece of work there is also a nice wave pattern which looks either to be completed or it may venture to US$1575 also an interesting triangle formation.
Just some thoughts

 

[Trembling Hand]

Moving along in the right direction. Stops nudged up a bit.

View attachment 50468

These two, in spite of starting well, turned to stinkers while I was away! Shame I was told that gold was going to be higher than the DOW in 6 months......