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Gold Discussion

  • #941
  • Jan 30, 2010 2:28am Jan 30, 2010 2:28am
Come here to see what gold people thinking about , fully matured shad,s h&s to validate or a bounce from tl pirin expected .just posted my confusion in eu thread.
thanks , fontu
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Not understand?better not follow my analyses!doubt clearer first, risks ++
  • #942
  • Jan 30, 2010 4:16am Jan 30, 2010 4:16am
Guys,
I largely trade USD against AUD and Euro. I wanted to check how commodity prices effect USD and was surfing this thread over the weekend. I learnt a lot from you guys. I have a few questions. I am not looking at the charts, but looking for your common sense answers :-)

In recent months, Excessive spending (stimulus) and printing, bought USD down.

Interest rate was lowest--> money went into stock market
Interest rate was lowest--> money went into gold--> Gold price has peaked --> manufacturers stocked gold

 

  1. Now US economy is trying to come back in shape. GDP has risen, this week NFP is going to be better than last month's. Soon the interest rate will go up. So USD will go up as happened starting from last week and accelerated after the GDP results yesterday. So I beelive in the coming months, USD will strengthen and that wil bring the gold price down. Right?

  1. My question is here. Obama pronounced that he wants to double US exports in 2 years or so. To do that, USD should be depreciated and not aporeciated as is happening now, so that US goods are cheaper to foreign currencies.

So I have two contradicting scenarios above. Any experts here, would you throw some light on what will happen based on these scenarios above? Will USD continue to climb up as gold goes down?
Will US produce it's goods in Asia at cheap price and export from there, so it is cheaper to buy from a foreign country than from strong USD? That means less jobs in US--> bad for US economy.

Thanks in advance!

  • #943
  • Jan 30, 2010 6:38am Jan 30, 2010 6:38am
Quoting PipMaxzz

  1. Now US economy is trying to come back in shape. GDP has risen, this week NFP is going to be better than last month's. Soon the interest rate will go up. So USD will go up as happened starting from last week and accelerated after the GDP results yesterday. So I beelive in the coming months, USD will strengthen and that wil bring the gold price down. Right?

[list][*]My question is here. Obama pronounced that he wants to double US exports in 2 years or so. To do that, USD should be depreciated and not aporeciated as is happening...

When you think about gold you shouldn't be thinking about GDP, the leading indicator about gold is inflation. With the rise of the CPI the gold will follow, no matter what Obama or Bernanke are planning to do next. If you have 1 $ in the market and 1 ounce of gold costs you 0,50 $ and the money supply M0 increases with + 1 $ you'll have now 2 $ in that market and it's equilibrium will be where the ounce costs you 1 $, when all other factors (retail supply and demand) remain unchanged. It's as simple as that. The more the inflation of a currency grows, the more the central bank will buy gold to hedge it.
  • #944
  • Edited 6:58am Jan 30, 2010 6:46am | Edited 6:58am
the dollar is strengthening, as i perceive it, because of higher risk, PIIGS in europe, Japan, (Dubai), exhausting now reversing bear rally in the DOW, liquidity drain (cb swap lines, repaid bailout money, leverage, prop trading), no lending by banks -> no spending -> no inflation

this all could end tomorrow of course (more QE, CA default, government spending spree, war ... etc.)

edit: yes, and listening to politicians talk is a waste of time, they tell you what you want to hear ... iow lying
Invincibility lies in the defence, the possibility of victory in the attack
  • #945
  • Jan 31, 2010 2:41am Jan 31, 2010 2:41am
Quoting PipMaxzz

  1. Now US economy is trying to come back in shape. GDP has risen, this week NFP is going to be better than last month's. Soon the interest rate will go up. So USD will go up as happened starting from last week and accelerated after the GDP results yesterday. So I beelive in the coming months, USD will strengthen and that wil bring the gold price down. Right?

[list][*]My question is here. Obama pronounced that he wants to double US exports in 2 years or so. To do that, USD should be depreciated and not aporeciated as is happening...

There is no contradiction. These two scenarios can follow each other. We can see gold down and dollar up for the next few months and then we can see dollar going down. And at some moment we might even see a decoupling of the dollar/gold trends.
  • #946
  • Jan 31, 2010 2:53am Jan 31, 2010 2:53am
Quoting Pirin
When you think about gold you shouldn't be thinking about GDP, the leading indicator about gold is inflation. With the rise of the CPI the gold will follow, no matter what Obama or Bernanke are planning to do next. If you have 1 $ in the market and 1 ounce of gold costs you 0,50 $ and the money supply M0 increases with + 1 $ you'll have now 2 $ in that market and it's equilibrium will be where the ounce costs you 1 $, when all other factors (retail supply and demand) remain unchanged. It's as simple as that. The more the inflation of a currency...
I think that inflation no longer plays that role in gold's appreciation. CPI was minimal in 2009 in U.S. (2.7%), while the gold rose 33.9%. Gold has become a very speculative asset with a rather unusual behavior. It gains when other investment opportunities yield too low and on the opposite it also gains when such opportunities are considered to be too risky. Gold falls only when there is some kind of the compromise in the market.
  • #947
  • Jan 31, 2010 8:26am Jan 31, 2010 8:26am
Thanks guys for the replies! I dont trade gold. What I learnt in my forex training is that Australian economy depends on gold price as they are the major gold producer. So gold price and AUDUSD currency pair are related and the inverse should be true. I am just picking up world ecocnomics and I may be wrong.

Are you guys all bearish or bullish on gold?
  • #948
  • Jan 31, 2010 2:35pm Jan 31, 2010 2:35pm
i am bearish. soros said couple days ago gold is next bubble.....
  • #949
  • Feb 1, 2010 12:35am Feb 1, 2010 12:35am
me ? end of bearish ! begin bullish with double bottom

http://i285.photobucket.com/albums/l...ottom01-02.jpg
  • #950
  • Feb 1, 2010 1:59am Feb 1, 2010 1:59am
Quoting PipMaxzz
So gold price and AUDUSD currency pair are related and the inverse should be true. I am just picking up world ecocnomics and I may be wrong.
you may start with these correlations, they can prove themselves quite helpful sometimes

http://fxtradeinfocenter.oanda.com/c...fxcorrelations
  • #951
  • Feb 1, 2010 2:07am Feb 1, 2010 2:07am
Quoting enivid
I think that inflation no longer plays that role in gold's appreciation. CPI was minimal in 2009 in U.S. (2.7%), while the gold rose 33.9%. Gold has become a very speculative asset with a rather unusual behavior. It gains when other investment opportunities yield too low and on the opposite it also gains when such opportunities are considered to be too risky. Gold falls only when there is some kind of the compromise in the market.
I meant that inflation plays a role when when the economy is going up, so that was future related. Of course every other sign of fear in the markets will cause the same reaction with gold, every bank that goes insolvent causes an investor to search for a rescue in commodities for example. I.m.o. gold can decline only if we have a stable growth in gdp, with low cpi (under 2-3 %). The more quiet the market is the more the gold will decline. While crisis reactions in gold can be only temporary, inflation is not. Increase in the money supply is the only inflation that causes long lasting effects. I'm bullish on gold (with first goal - 1170).
  • #952
  • Feb 1, 2010 8:39am Feb 1, 2010 8:39am
supply and demand. economy is bad. people have less money. people buy less gold jewelry. it's not 'just' a store of value. 1090 resistance , 1075 support - medium term, once below 1075 the down trend will continue.
  • #953
  • Feb 1, 2010 9:11am Feb 1, 2010 9:11am
Quoting Clouds
supply and demand. economy is bad. people have less money. people buy less gold jewelry. it's not 'just' a store of value. 1090 resistance , 1075 support - medium term, once below 1075 the down trend will continue.

down trend was ending at 1075, now we will see 1180/1225
  • #954
  • Edited 1:12pm Feb 1, 2010 10:58am | Edited 1:12pm
Previous & Present Charts !

Plus 1 More !
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* Never Trust To Any Indicator *
  • #955
  • Feb 1, 2010 11:39am Feb 1, 2010 11:39am
Quoting Shad
Previous & Present Charts !
where do you see a SHS?
Invincibility lies in the defence, the possibility of victory in the attack
  • #956
  • Feb 1, 2010 11:41am Feb 1, 2010 11:41am
Quoting banana9009
down trend was ending at 1075, now we will see 1180/1225
Do you like to bet?
soon we will continue down move
let's watch it
  • #957
  • Feb 1, 2010 12:53pm Feb 1, 2010 12:53pm
now gold is up 20 dolars. is just a pullback ?
Quoting egkid
Do you like to bet?
soon we will continue down move
let's watch it
  • #958
  • Feb 1, 2010 1:13pm Feb 1, 2010 1:13pm
sellers were waiting around 1105
  • #959
  • Feb 1, 2010 2:36pm Feb 1, 2010 2:36pm
Quoting geocatalinfx
now gold is up 20 dolars. is just a pullback ?
in my view It's Correction before resume down
Next 90 min is important where the price will close and i maybe add sell
depends on my daily close But after all 1106 is respectable Resistant
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  • #960
  • Feb 1, 2010 2:42pm Feb 1, 2010 2:42pm
Quoting egkid
in my view It's Correction before resume down
Next 90 min is important where the price will close and i maybe add sell
depends on my daily close But after all 1106 is respectable Resistant
i hope you took some profit

if you want to sell now whats the trendline for?
Invincibility lies in the defence, the possibility of victory in the attack
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