Will Gold Bounce Back to All-Time Highs in July?

Gold: The continued pressure of a strong dollar saw gold fall yesterday as it technically broke through the trend-line of $934. Despite equity weakness, gold remains heavy. A move lower in the short term would seem likely. However, with the gold/silver ratio of 68.7, a 1st quarter low, this downward trend may soon be capped and a bounce back to all time highs in July may be possible. It has gained slightly this morning and is currently trading at $920.34.

Due to this price breakdown, gold ETFs saw net inflows for the first time in 3 months.

Although this could be a bearish signal for the very short term, the massive economic stimulus packages and government deficits in the UK, the US and internationally should mean gold continues to receive a safe haven bid. Furthermore, the continued printing of money by governments trying to inflate their way out of debt means the reason to invest in gold as a hedge against inflation is more pertinent than ever.

Silver: Silver is following gold and is currently trading at $13.75. The 100 day trend line is $13.58 but given the current pressure on the metal, a move lower to $13.10 is possible.

Platinum Group Metals: Platinum has gained $7 today after dropping by almost $40 yesterday, breaking through lows not seen since October 08. Currently trading at $1167, look for support at $1130.

Palladium has followed platinum but is holding firm at $230.

Rhodium had a $100 downward move, currently trading on a bid/offer of $1350/$1450.

Comments

[DONE_SONZ:]

Nothing has changed fundamentally with gold.All the reasons to hold gold and the miners remain.

Jun 23 09:39 AM

[Vuke:]

Forbes reports the IMF is mulling an "adjustment in the value of the $US" to increase exports. Presumably, this would mean down.

But, against what? Almost every other currency is clawing its way lower to increase exports which leaves.....gold.

www.forbes.com/feeds/a...

Jun 23 06:46 PM

[cameroni:]

You would think that Gold would get support as a safe haven in a market that looks to be declining again. But it won't. There is still not yet enough public support for gold as an alternative to "safe" investments like T-Bills etc.

Even most investors are only perceiving Gold as a good investment or a possibility with the threat of inflation arising. But, and this is a big but,...we are NOT inflating yet. Far from it actually. We are continuing to experience a deflationary period that could still send us into a full fledged depression.

And while I am a "dyed in the wool" inflationist I will NOT be a big gold buyer until I actually start to see the peices of the inflation puzzle start to come together. We are not there yet.

So save your powder for the real battle.

Jun 23 09:57 PM

[cameroni:]

I think that what I was really trying to say in my previous post but did not say was that we need to continually reassess the market, even daily, to determine the best course of our actions.

We cannot allow ourselves to get too emotionally involved in the inflation vrs deflation debate despite our personal certainty of the ultimate outcome.

A lot can happen between now and then that could change outcomes. And a lot of money could be made or lost based on perceptions of what will take place. Timing is near impossible for even the best traders. Your gut will tell you the right thing to do at the right time (if you believe in that sort of thing).

So,... will Gold bounce back to all-time highs anytime soon?

I don't think so now. The deflation trend has strengthened on recent news of the CPI, Unemployment numbers, Real estate price declines, retail sales, Fed rates and dismal news from international markets.

Policy outcomes will certainly take us inflationary eventually but that time is not yet and it is not now. So be careful.

Jun 23 10:23 PM

[Francis Sch...:]

Gold will pobably not only return to the old peak, but also break above it...after all, expressed in candollar and swiss franc it already did brak through the 1,000 level..Therefore, I really don't understand why all the havoc of poor US dollar breaking through this level..after all, it is just a figure.

Jun 24 09:25 AM

[Mayascribe:]

When Warren Buffet says deflation is no longer an issue, I listen. When Warren Buffet says inflation, for the short term (one to two years), will not be an issue, I listen. When Warren Buffet says inflation is destined to come, I listen. (He said all of this on CNBC today)

Buying gold stocks, or bullion right now is highly risky. But, if you have patience and stones for nads....

The only gold mining stock I'll chance with on the dips is Jaguar Mining (JAG). Jag is increasing its production capacity faster than any other miner out there, and by 2014, Jag expects production to be up 600%. That's on top of a greater than 50% increase in production during the previous two quarters.

Do the simple math: If Jag is increasing production by 600% in the next five years, than the stock should trade up accordingly. And, if Buffet is right, that in a year or two inflation takes off, what multiplier effect do you think will happen with Jag's stock?

Jun 24 03:25 PM

[capt Brian:]

I am ready for a gold price increase, but it appears gold gods are not listening, as I wait patiently for gold to increase, all it does is sit there and look pretty. I think I an gonna pull in some Precious metal money and put it to work in a nice single premium deferred annuity where I can get some return. Getting tired
of waiting for gold and silver.'

yawn n n n n
happy grins to all of you

Jun 24 06:35 PM

[HA65MPH:]

CAPT....BE PATIENT....RETURNS ON GOLD WILL AMAZE YOU ...YAWN...

Jun 26 10:18 AM