Commodity Trade Mantra

Posts Tagged ‘Gold Bullion’

Falling Mine Supply will Trigger Panicked Gold Buying & Higher Gold Prices

Once the price of physical gold starts to move up on basic supply and demand fundamentals & imbalances in the paper gold market, the stage is set for corresponding increases in paper gold prices. As more & more paper gold holders turn from the paper market to obtain physical gold, which is already in short supply in the physical market, we’ll see the beginning of a price super-spike.

Would You Invest in Gold And Silver Bullion or Bitcoin?

From $412, one year ago, to $1290 on Friday, bitcoin has gained over 200%. Compared to the price action in bitcoin, gold seems boring. While this is a virtue for gold to be used as money (and a vice for bitcoin), it does tend to attract those who just want to get into the hottest casino du jure. There’s more than enough irony to go around.

The Reasons For Owning Gold Bullion Are As Strong As Ever

Given its recent surge, is gold still a “buy?” With the Fed in a tricky situation regarding interest rates—and ambiguity likely to continue to surround the political arena—we may be in for a wild ride in 2017. Given the uncertain outlook and improving fundamentals for gold, now is a great time to add the yellow metal to your portfolio.

Massive Debt Pain in China Could Be a Blessing for Gold Investors

Although the economy grew by 6.7% in 2016, the debt is causing a host of problems in China. The main reason many Chinese are buying gold is to preserve wealth against the backdrop of massive fiscal stimulus & lax credit conditions. Never has a big economy piled up so much debt so quickly without serious repercussions. It could be wise to take a lesson from Chinese investors & buy physical gold.

Gold Market Seems Ready to Breakout Higher

Gold bottomed on the 15th of Dec 2016, but the dollar continued to trend higher for several more days and Gold reacted in a positive way to this development. The dollar has been on a tear since Trump won, so Gold should have continued trending lower, but it did not. Gold has now given the first signal that it is getting ready to test the $1360 ranges with a possible overshoot to the $1380 ranges.

A Correction-Grade Stock-Market Selloff & Investors will Rush Back to Gold Buying

Gold has managed to rally sharply in recent weeks without any capital inflows from American stock investors. They not only weren’t buying GLD shares, they continued to aggressively sell them as evidenced by a couple big GLD-holdings draw days so far in January. The situation implies the investment gold buying hasn’t even started yet & that means big gold buying is still coming.

Higher Debt Will Accelerate Central Bank Gold Demand

The U.S. government is currently saddled with $19.9 trillion in public debt. The US dollar accounts for about 64 percent of central banks’ foreign exchange reserves. With the potential for higher U.S. budget deficits and debt risking dollar strength, central banks around the globe could be motivated to increase their gold holdings, says Credit Suisse.

Run to Gold as the Inflation Beast Rattles Its Cage

Portfolio-destroying inflation is around the corner because of reckless government spending and unsustainable debt, so stock up the bomb shelter and buy gold. The latest data suggests that the inflation beast is stirring from its long slumber, which means that the classic inflation hedge of gold is on the verge of a sustained rally.

With all the Fragmentation, will the London Gold Market Self Destruct?

The London Gold Market is now having an identity crisis. In the last year we have seen a barrage of news about changes that are coming. To us, it seems the role of price maker is becoming increasingly up for grabs. And, in the time it takes for London gold market to come through its disruptive phase, will the Chinese have taken a bigger piece of the pie for themselves?

Renewed Buying in Gold Futures & GLD Shares Fuelling Gold's Next Upleg

With gold futures speculators’ collective bets no longer excessively bullish and holding back gold, that paves the way for major investment buying to resume. Meanwhile American stock investors have resumed heavy buying of GLD shares again, fueling this ETF’s big early-quarter holdings build equalling Q1’16’s massive jump that ignited gold’s young new bull.

Gold Prices & it's Relationship with the Expansion of Fiat Money

Not only is Fiat Money Quantity, continuing to grow above its long-term trend, but it appears to be accelerating. The inflationary implications are obvious. Gold is already under-priced to a substantial degree. Further expansion of FMQ will eventually lead to a complete reassessment of the price relationship between fiat dollars and physical gold, to gold’s benefit and the dollar’s detriment.

Gold Jewelry Buying Expected to be Exceptionally Strong

Plentiful monsoon rains in India tend to drive up demand for gold & gold jewelry among rural, income-flush farmers, who make up a third of the country’s consumption of the yellow metal. Gold jewelry sales in India are expected to surge as much as 60% over last year, during this year’s festival season thanks to the fortuitously timed sharp drop in gold prices.

Weekly Outlook for Silver Prices - Volatility in Gold Prices on the Rise

At present, the bias in silver prices is to the upside, as new buying appeared to be behind last week’s advance in prices, as open interest increased nearly 6% through Thursday. In addition, the U.S. economic calendar for the week is full. The possibility of victory for Trump & a second US interest rate hike could cause increased volatility in gold & could rise as high as $1,425.

Will The Price of Silver Take a Breather Before Another Rally Kicks Off?

The price of silver has emerged as the perfect compensation for those whom the market inflicted losses last year. The price of silver appears set for a correction, which suggests the overbuying activity that took place in June could witness several cash outs in the coming weeks. But the overall direction of commodity prices suggests that this could just be a breather before another rally kicks off.

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.

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.

Supplies of Physical Gold are Tight - A Super Spike in Gold Prices is Coming

The key to seeing a gold-buying panic in advance is to follow the flows of physical gold. Once the price of physical gold starts to move up on basic supply & demand, there are increases in paper gold prices. As soon as demand begins to overwhelm supply, then it’s “game on” for significantly higher physical gold prices followed by the toppling of the inverted pyramid of paper gold contracts.

Who Will Decide the Fate of Gold ETFs? The Fed or Donald Trump

Citigroup sees gold prices touching $1,400 levels ‘not seen since early 2013’, while the metal will likely slide to the $1,250 level if Clinton makes it to the White House. Citigroup believes that Trump’s protectionist ideas on external trade and immigration, if realized, suggest a US recession sooner rather than later. Investors to keep a watch on gold ETFs like GLD.

Surge in Smuggled Gold Hits Indian Gold Refiners, Gold Jewelers & Banks

Smuggled gold could account for over a third of demand this year in India – the world’s second-biggest buyer of gold – potentially costing the government over $1 billion in lost revenue. Gold refiners have less than a 1% margin. If smugglers offer 4 or 5% discounts, they have no choice but to close operations. All 32 refineries in the country have stopped buying dore until market conditions normalize.

Gold Price Driven by Massive Speculation in Paper Gold

Speculation in paper gold is both an effect of the gold price and an important short-term driver of the gold price. It is therefore fair to say that although changes in GLD’s gold inventory don’t cause anything, they often reflect changes in speculative sentiment that at least on a short-term basis do have a significant influence on the gold price.

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