Commodity Trade Mantra

Posts Tagged ‘Gold Price’

Gold and Silver Backed Insurance in Times of Turmoil

Investors buy physical gold and silver because it is a store of value – a way to protect your wealth from the relentless devaluation of fiat currencies – and a safe haven in times of turmoil. Buying gold numismatics is not the way to do this and buying gold numismatics that aren’t…well that’s being taken advantage of, to put it politely.

The Fed will not raise rates for the fun of it. The Fed wants to keep inflation under control, but what the organization really wants is negative real rates. That’s where inflation is higher than nominal rates. It does the Fed no good to raise rates unless inflation is going up even faster. Yet that’s exactly when gold does its job of preserving wealth.

The gold market is starting to look extremely oversold, so what does this mean for gold focused investor? For those with a more aggressive investment philosophy, a stomach for buying dips at support levels and a strong conviction that gold is going higher in the long term, the next few weeks may offer up a good buying opportunity.

Choking Inflation is last thing the Fed wants now - Good for Gold

The Fed will not raise rates for the fun of it. The Fed wants to keep inflation under control, but what the organization really wants is negative real rates. That’s where inflation is higher than nominal rates. It does the Fed no good to raise rates unless inflation is going up even faster. Yet that’s exactly when gold does its job of preserving wealth.

Gold offers Insurance, but Silver Additionally offers Better Profit Opportunities

Hike or no hike, there is no place for the gold and silver bulls to hide. Silver is slower to move than gold, but it has more room to move and this delivers better profits. The similarity in the patterns on the gold and silver charts means the silver price follow the behaviour of the gold price. The best trade is to watch gold and execute the trade on the same price move in silver.

Can You Guess the US Election Winner? It's Obviously - Gold

Investors are on edge…and we can’t blame them. The S&P 500 has fallen nine straight days. Safe-haven demand maybe set to rise as the US election is now just days away. Unlike past elections this one appears to grown more uncertain and fraught the closer it gets. There’s one certain winner of next week’s presidential election, according to HSBC: Investors in Gold.

A More Robust Understanding of the Price of Gold & Gold Valuation

A combination of a top-down and bottom-up approach is required to develop a more robust understanding and valuation of gold. Certain inputs put together, this recommended framework allows investors to use current variables and easily available economic forecasts to form a consistent, self-contained and intuitive view on the price of gold.

Is Now the Best Entry Point for Gold Investors?

Gold was hammered down while Chinese markets were closed in the prior week, triggering a technical buy signal and possibly the best entry point in over a year to add to positions. Is now the best entry point for gold investors? Yes. Faster U.S. inflation and low interest rates will support gold. Gold always performs best when nobody thinks you should own it.

Time for Patiently Using Corrections & Patterns to Build Gold Positions

The correction is providing an opportunity to enter stocks that we thought got away. The question is precisely when to make those moves. If historic patterns around W-shaped corrections & reactions of gold to rate hikes persist, we could be looking at a strong start to 2017. This fall may be the time for patience & using patterns to position your portfolio for gold’s next leg up.

Gold Bull Market Intact Regardless of Short Term Price Gyrations

Gold remains the asset Wall Street loves to hate. Currently the fundamental drivers of gold are mixed, which makes a sideways move the most likely prospect, barring new developments. We remain convinced that the monetary experiments of recent years will end quite badly, and that the long term case for gold remains intact regardless of short term price gyrations.

Rate Hike Largely Priced into Gold and Silver - What about Rationality in Sell-off?

Could the FED finally raise rates before 2016 draws to a close? That sounds plausible in theory, but there are a number of factors that do not support a rate hike in the near term. But even if they do hike rates, this move is already largely priced into gold and silver. We should question the rationality of this sell off. After all, the gold price often moves higher along with interest rates.

Sellers of Physical Gold Did Not Help Crash Gold Prices - Then Who Did?

The total volume of the crash in excess of 1,000 tonnes of paper gold contracts, dumped on the market in a matter of hours, makes it pretty clear that something ‘fishy’ was going on. So the main question remains, who sold? Clearly, the futures market crash was NOT caused by sellers of physical gold. But China & Russia will love & use the buying opportunity.

The Stability Regarding Purchasing Power of Gold is Unprecedented

An often-perceived analysis in the gold community is that gold is the constant in our global economy. While there is no exact constant in economics, the stability of gold’s purchasing power is unprecedented. Not only on a gold standard the metal shows it’s constant nature, but also off the gold standard gold’s purchasing power is remarkably constant, albeit more volatile in the short term.

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.

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.

Due to Financial Cancer of Debt, Devastation is Our Future- Gold the Only Remedy

The fact that demand for gold is soaring says a great deal about investors’ combined frame of mind these days. People are scared. I fear devastation is in our future. If central bankers had succeeded in their efforts, we would have no need for negative rates. There is simply too much debt (financial cancer) in the system to save it. And buyers of gold know this.

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.

Does the Current Gold Price Justify the Big Gains in Gold Stocks?

Despite the 25% decline in the gold price since 2013 to $1,050, profit margins only fell by 12% as the industry responded by cutting costs and restructuring their operations. With gold now trading at $1,350 per ounce and AISC holding steady, net profit margins for the industry have increased from $220 to over $500 per ounce – an increase of 127% in just 7 months.

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