Monday, Mar 01, 2010
On the way to £900/ounce
Bullionvault: Gold Fix Hits New British Pound Record as "Currency Battle" Between Politicians & Markets Intensifies
The price of gold ticked lower on Monday after recording its best London Gold Fix in a week for US holders, hitting new all-time highs for UK investors as the Pound sank vs. the Dollar and European stock markets cut their early gains.
Dropping to an 11-month low on the forex market, the Pound fell beneath $1.48 after weekend opinion polls showed a "hung parliament" ever more likely – with no single political party in charge – at the UK election that must happen by June.
The Euro also fell hard, down 1.5¢ despite reports of a drop in Eurozone joblessness, stronger manufacturing orders, and an unexpected rise in import prices.
The Gold Price in Sterling hit a record London Gold Fix above £742 an ounce, some 299% above its price of 1st March a decade ago.
14 Comments
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1. freemanphil said...
Update, gold hit £754/ounce.
2. debtfree said...
Love it, I bought at £200 an ounce and then again at £270.
Of course, most on here will tell you gold is not worth anything and is in a bubble because of some pretcher report with charts that resemble a mountain range.
It's going to £1000 an ounce.
Enjoy the ride
3. techieman said...
"Of course, most on here will tell you gold is not worth anything and is in a bubble because of some pretcher report with charts that resemble a mountain range."
Not quite accurate debt free. Yes you are right Mr P has made some erroneous calls on gold. Fact. But he did suggest buying when Gordy was selling. You are right that now he is bearish... in dollars. And lets face it in dollars it hasnt moved much since i sold out large lumps in March 2008 (and happy with that decison), when the world and his mate were saying it was off to the moon. Since then we have seen lows of $680 and highs of $1200.
In sterling terms of course the dollar has appreciated, since the heady days of 2.11, and maybe holding gold [well probably anything - except houses of course!] in Sterling terms is probably a good idea.
Funnily enough they - Mr P and associates, did have a chart of Gold priced in Euros and they said that was due a substantial move up.As you know i trade the commodity complex in the currencies in which they are quoted in the US markets. I have not added to my gold position for quite some time now... and have absolutely no intention of doing so.. its not a market that i find that interesting.
Now as for the £/$ ... thats a different story. [incidentally Mr P has been massively bullish on the dollar - and made a pretty good call near the low, and the index has broke resistance to the upside. All of this since the dollar low may be the first move with a significant retracement (maybe or maybe not in £ terms) before the dollar ramps up. Of course a fall in the dollar will get the dollar collapse boys salivating!]
4. techieman said...
Debt free - here is what he says... you will see he calls gold "real money" and has always advocated having some gold. Of course he might or he be wrong... He actually says that gold is overvalued in DOLLAR terms. He mentions in dollar terms twice.
http://finance.yahoo.com/tech-ticker/bear-market-armageddon-why-prechter-might-be-right-this-time-430357.html;_ylt=AuDBDMEnLZJWuyEGfjpHpztk7ot4;_ylu=X3oDMTE4OWN0a2QxBHBvcwMxMTUEc2VjA2FydGljbGVMaXN0BHNsawNiZWFybWFya2V0YXI-?tickers=dia,spy,^dji,^gspc,gld,tlt,tbt
5. freemanphil said...
techieman, Pretcher is critiqued by Bob Chapman who says that short term charts no longer work, because the market is rigged, primarily with naked shorts, but also via ETF's that do not have the gold they claim to have. For example, see gold hit on options expiration day every single month as the bankers and politicians attempt to cut off long positions and cover their shorts.
6. debtfree said...
Thanks for the info techieman and good luck to you.
I'm in the Jim Sinclair camp, which is gold breaking through $1650 and the dollar breaking down along with most western currencies.
Prechter: Gold To Fall 40% From Here - Jan 2010.
Only time will tell, but if you were to go with past predictions, Jim Sinclair would be odds on favourite.
7. bellwether said...
Debtfree I actually admire your conviction.
Not intended as a slight at all but it reminds me of the conviction with which people cling to property, and in so doing many have become very rich. I have actually begun to wonder if a dogged and relatively unreflective approach is the one that often strikes big - as long as it hits on the right long term bet.
The alternative is to be concious of the huge uncertainty which surrounds any position/proposition. Combined with a capacity to bear the doubt this level of nuance will propbably lead to the greatest success but without that capacity the insight into how uncertain things are can just result in vasillation and unproductive doubt. Good luck with your gold
8. debtfree said...
bellwether,
my personal view is that holding gold isn't going to make you rich, it's about wealth preservation.
For example, I'm thinking of buying the new apple imac which will be 1 coin and a bit of extra cash. total cost price £350. They retail for just under £1000.
All the best to you as well.
9. techieman said...
Debt free - i am not in either camp.
I was just pointing out what precther actually says. I have gold... just not as much as before, so it would be nuts for me not (all other things being equal) to want it go up. However as far as i am concerned I was very happy with getting out of most in 08, if i had held on for 2 years, what would i have to show for it? A few more grey hairs and a fair bit of worry / have i missed the boat type questions - especially when we went below $700. Effectively in 2 years it has more or less stayed where it is [bit of poetic licence if you please :-)]..
FMP - "Pretcher is critiqued by Bob Chapman" actually he is by everyone! As for the charts not working... they always work or never work anyway depending on how you use them. As for options expiry there is a theory that the final price at delivery will be the price at which most people lose money. Infact there is a website you can subscribe too its called http://www.optionpain.com/, which calculates where that is.
10. techieman said...
http://www.optionpain.com/OptionPain/Option-Pain.php explains it..
11. hpwatcher said...
The recent rises in gold are all about currency movements rather than about any 'breakout'. I would advise looking gold charts as priced in dollars to get a better view of the [upward] movements.
12. techieman said...
Actually HPW - there has been a downward sloping trendline break from the top, with a "back-test" of that line. If it breaks $1074 thats probably bearish. If it doesnt it may start marching on a bit.
13. hpwatcher said...
I think gold is doing pretty well at the moment, but I still think it early days; I would not want to see any sudden upward movements for a while yet - though this will depend on future events/influences.
Downward movements are probably okay because there is a large amount of support; at the moment I see that support going well into the medium term.
14. Grizzly Bear said...
Yipee, Ag is going up too, and I bet this will leverage up, in the Gold Producers, in my Pension funds :)
Pretcher maybe right about a lot of stuff, however I disagree that Gold will drop much against devaluing fiat currencies, the whole game changed when the Gold Standard was dropped by the US, and Gold is still treated as the international measure of value, during a crisis; Central banks and the IMF still keep loads of Gold!