Cache Metals? Bullion and Commodity Week-In-Review for?November 15 ? 19, 2010
GOLD
After a less than stellar week for spot gold the metal finally found some support amid all the turmoil in the world. Gold traded to a 2 month low of $1329.80 before bouncing back and turning higher.
The main driver has been the turmoil in Ireland and whether they will take the bailout money. Now if you talk to Irish officials they claim they do not need the money. The flight into the US dollar started last week and continued this week. The Euro/USD traded to a low of 1.3456, overthe weekend. Various media reports suggested that EU and IMF officials were huddled in a round of negotiations with Irish authorities over the possibility of accepting a bailout package.
Despite the hesitation of the Irish authorities, pressure on the third largest island in Europe didn?t let up this week as speculators now view the situation as essentially irreparable. With Ireland now completely shut out from the credit markets as the cost of borrowing has become expensive, the country finds itself in an increasing dangerous situation as day to day financing needs are unmet. Another catalyst for the fall in the price of gold was speculation that China?s central bank, the People?s Bank of China (PBOC), is planning to raise interest rates thus increasing the
opportunity- cost of holding the yellow metal. The impact of a possible Chinese rate rise would also be felt in the commodity markets, where Chinese demand plays a significant role in setting prices. As a reminder, China raised rates back on October 17, sparking a world-wide sell-off in stocks, commodities, emerging-markets and currencies as investors lowered their expectations for Chinese growth. Gold fell $36.10 to $1335 back in October, just where we stood Wednesday. Investors moving from the euro to the U.S. dollar can weigh in gold prices for only so long. If the sovereign debt issues spread throughout Europe, we could see investment demand for gold around the world rise substantially.
Mixed US data trickled out over the past week and couldn?t temper the rally in the green back. US manufacturing output rose by .5%, the most since July. The latest economic reports offered a glimmer of hope that the economy is moving forward. The increase in the Philly Fed survey and the low level of jobless claims provided a relief for traders and investors. However, before we start to dance in the streets, it is important to realize that the mixed bag of reports coming out indicates that the recovery is uneven. This means, easy monetary policy is still necessary to support the recovery and we could still see another round of QE3.
The week is closed out with gold trading nicely off of its lows of $1329 as the Irish bailout still has the attention of traders. As much as it wasn?t a surprise China was raising their interest rates again quelled the temporary rally as China is clamping down on its economy and tightening their belts. This will have an effect on the global recovery as China was leading the world in the recovery. Next week will be a short week as traders eye the US thanksgiving. It will be light with economic data so we should look to the currencies for some direction.
The Time?of Investing in Silver or Gold is NOW.?Visit www.cachetelevision.com
?
Marcin Migdal -
About the Author:
Marcin Migdal is the founder and CEO of Madcap Media Inc. and www.ActiveTVNetworks.com. He is a dedicated and already established serial entrepreneur and Finance Investor with over 12 years of experience in multimedia development and entrepreneurial ventures in internet start-ups. Mr. Migdal is the driving force behind the conceptual and architectural frameworks of his ventures and actively seeks new monetization methods for his clients based on the social media platforms he develops through Active TV Networks.
Madcap Media provides services in online and desktop software development and branding for his other ventures and clients. Active Tv Networks (ATVN) provide Self-Managed Websites & Turn-Key Tools that give Schools, Stores, Companies, Individuals and Museums the ability to manage content, drive more traffic & profit faster from their sites. ATVN develops robust content management systems, custom portals & products for publishing & delivering your content to the web.
peyton manning v for vendetta bear grylls nhc fedor emelianenko sos powerball
No comments:
Post a Comment
Note: Only a member of this blog may post a comment.