Commodity Trade Mantra

All posts under ‘Gold Trading’

Gold Remains a Mandatory Portfolio Asset

Can the US financial system endure normalization of interest rate structures? No. Gold will remain a productive portfolio-diversifying asset until the process of debt rationalization is allowed to proceed in the US. Given implications for declining intrinsic value of US financial assets, as well as ongoing Fed efforts to debase outstanding obligations, gold remains a mandatory portfolio asset.

Hike Gold Price To Get Inflation When All Else Fails

Raising the price of gold is the easiest way to get inflation. A higher dollar price for gold is practically the definition of inflation. Governments can do this in a heartbeat. The Fed would just declare the price of gold to be, say, $5,000 an ounce & make the price stick using the gold in Fort Knox & their printing press to maintain a two-way market. If you don’t believe this can happen, just check the history books.

Gold Prices Lose Steam After Post-FOMC Rally, May Turn Lower

Gold prices struggled to find follow-through after posting the largest daily gain in two weeks following the FOMC rate decision. Initial elation at the flattening of the central bank’s projected rate hike path in the immediate aftermath of the policy announcement may be giving way to the realization that Chair Yellen seemed to all but promise a rate hike in December.

Gold Futures Traders Breath Easy as Dovish Fed Powers the Next Major Rally

Gold futures surged after the Fed again chickened out on raising its benchmark interest rate. Gold futures speculators’ fear of Fed rate hikes has been a major drag on gold. Rate-hike risks just plummeted in the coming months, since the Fed can’t risk acting heading into the critical US presidential election. Gold’s next major upleg is likely just unleashed by the Fed.

Silver and Gold Prices Supported by Weak Dollar - Rally Stalls Abruptly

A continuation of the defensive dollar tone over the past 24 hours, coupled with downward pressure on bond yields, has continued to provide underlying support to silver and gold prices. Analysts warn that continued upside for gold futures may be limited now that a Dec rate hike is firmly in play. According to Fed Fund futures, traders are pricing in a nearly 60% chance of liftoff by year-end.

Recycled Gold has met 60% of Indian Gold Demand on High Gold Prices

India has traditionally been one of the largest gold markets on the planet, second only to China. But, the high gold prices are threatening India’s status as a leading importer of gold. So much recycled gold has come into the system in the past few months that it has met 45% to 60% of the local gold demand. However, demand for gold in the US has risen 27% this year.

Gold Price And The Interest Rate Disconnection

We are entering a new phase in gold price action where expectations of Fed interest-rate policy becomes less important & other gold price drivers come to the fore. I believe the Fed will have little room to raise interest rates by anything more than a token increase. What’s more likely, the US & global economic news will continue to disappoint & this could be enough to support a rising gold price.

Why And How The US Fed Will Drive Gold Higher

After raising rates in Dec, the US Fed back-flipped on its aggressive interest rate policy earlier in the year. The US stock market nosedived by about 10% and Chinese debt issues worried investors. Gold & gold stocks went through the roof! Despite the stock market recently hitting all-time highs, the Fed kept delaying increasing rates. This ‘wait and see’ policy is causing a lot of uncertainty.

30 Years of Data Says Gold Prices Will Rise If the Fed Hikes Rates

Fed rate hikes have, on average, seen much stronger gold gains than a cut, and more frequently, too. Seen against the last 30 years of data, gold is anticipating a major shock from Wednesday’s announcement. If the bond and futures markets prove right instead, and the Fed delays again, the turnaround in gold bullion could be swift.

Look at the Long-Term Gold Chart for the Trend in Gold Futures

From the 2011 high, a downside correction emerged in gold prices. According to traditional Fibonacci theory, the 2011-2015 pullback did not harm primary uptrend in gold prices. That means the gold tide remains bullish. Pullbacks in the tide are waves that could be used as buying opportunities. If gold takes a short-term hit, this could offer a “wave” within the tide.

The War on Cash Is Still Good for Gold Prices

In a world where nothing larger than a $10 bill exists, hoarding cash would be highly impractical. As paper currency is phased out, gold prices will rise. Were cash eliminated and interest rates plunged underwater, gold’s role as a store of value would become even more apparent and demand for the yellow metal would turn red hot, despite its price appreciation.

Will Silver Prices take off like a Rocket while Gold Prices Languish?

Why are junk bonds and equities not dropping commensurately? It’s crystal clear that if rates are truly moving up, then all assets will be repriced lower. So for the moment, the prices of the metals— silver more than gold—are driven by this Narrative.It would be strange to see the price of silver take off like a rocket while the price of gold languishes, moribund.

Gold Bears Won't Have Reason to Rejoice Even if Rates are Hiked

US data has been looking distinctly soft of late. If growth continues to tail off, then the case for a rate rise will weaken rather than strengthen, so it may be a question of now or never. The conventional thinking is that a rate rise will lead to a fall in the gold price. It may be that the rate rise that’s now supposed to put a brake on gold will have more of a temporary dampening effect.

Outlook for Gold and Silver Prices in a Crucial Central Banks' Influenced Week

There is a very high degree of uncertainty over market developments in the week ahead, but a fresh surge in volatility is guaranteed. The decisions by the Bank of Japan, followed later by Federal Reserve will have a big short-term impact & an important influence on market direction for the remainder of 2016. Gold and silver prices settled lower last week. Here is the outlook for this crucial week.

Gold Has No Reason To Fear The Fed's Potential Interest Rate Hike

A 25-basis-point move in September is not going to be disastrous for gold prices, which have risen almost 30% gains since the lows in December. I don’t think the gold market has anything to fear from U.S. monetary policy. Even if rates rise 1% this year, the important thing to remember is that real rates will still be negative and that is ultimately positive for gold.

Hope in Currencies is a Poor Investment Strategy - Trust in Gold is Better

If somebody gives you gold, you don’t have to trust them or the instrument that you have been given – they represent payment in & of itself. Fiat currencies are not really payments. They’re promises to pay, and they work well as long as social trust remains. How long will the trust remain? Well, hopefully for my lifetime & yours too, but hope is a very poor investment strategy.

Gold Prices Based on Historically Low Real Interest Rates - A Small Hike Won't Hurt It

Gold prices are up 26% so far in 2016 & heading into the fall the greater risk remains to the upside due to the tremendous amount of money sloshing through the system. The potential Fed rate hike this September will not hurt gold prices because gold prices are a function of historically low real interest rates. Also helping gold, is the dislocation in the currency markets, especially post-Brexit.

Gold Prices Poised to Leap as Love Trade Overtakes Fear Trade

India has pulled ahead of China. The economic output of India’s top 5 cities is expected to reach the size of 5 middle-income countries today. Mumbai’s massive $245 billion economy, could soon exceed the entire country of Malaysia. This presents a huge opportunity for the Love Trade to expand even more, as rising incomes & economic momentum have been a tailwind for gold demand.

Gold Bullion Flows Reverse Back into the West - What does it Mean?

U.S. has become a significant gold importer. Gold is flowing from vaults in London, Switzerland & even Dubai to the U.S. In May, U.S. imported over 50 times the monthly average amount of gold. Investor demand was the largest component of gold demand for Q1 and Q2 – the first time this has ever happened. This means that more U.S. investors are diversifying their assets into gold.

Gold and Silver Demand Beginning to Undo Government Intervention

I’m just perfectly content stacking my physical gold and silver because I know in the end, these uneconomic systems that are just a sham and illusion like this, they just can’t go on forever. And we’ll patiently wait for that end to come. Though I’d love to see that happen next week, I think there’s reason to be optimistic. Then we’ll just see what 2017 holds.

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