Gold's Next Move Will Come from Inflation Figures

Gold: Gold failed to settle above $960.0/oz yesterday despite the EUR/USD breaking its previous high and touching 1.4445. Gold will have to settle above $960.00/oz for it to test its previous high of $1,033.00/oz but a lackluster performance over the last few trading days suggests it is having difficulty.

Direction today will come in the form of inflation figures out of Europe and the US, and the closely watched US Home Sales. If gold does break through $960.00/oz the next resistance will be $981.00/oz. Failing that we will revert to the current range of $905 - $960/oz.

Silver: Silver continues to look to gold for direction with near term support and resistance at $14.09/oz and $14.48/oz respectively.

Platinum group metals: Despite an agreement in South Africa on Friday, negotiations remain ongoing within the PGM Sector. Good news for the PGMs came in the form of higher than expected US July auto sales yesterday. This coupled with soundings from the manufacturers that they intend to increase depleted inventory, leaves platinum trading at $1,223.00/oz and rhodium at $1,650.00/oz.

Disclosure: No positions

Comments

[Zoltan L. Kovacs]

Its time for Gold again.

2009 Aug 04 08:09 AM

[Mongoose]

Ditto

2009 Aug 04 09:54 AM

[Spartacuss]

Does it matter?

I suppose if you are a short term trader it may. The interesting thing though is the peculiar lack of volatility in very volitile times. This feature, it seems to me should be noted with the result of attracting the "buy and hold" people. However, I posit that in the whole of the investment world the number of "holders" out there are shrinking. Now, everyone is a trader, in and out, in and out. Nothing wrong with that but a life of fickle here and fickle there has to have appeal to those same minds that like to frequent casino's and red light districts.

My point is that big fund operators in this climate are loathe to enter the gold arena and that is why this market just trudges. However, we must remember that once the gilt wears off the brass, this equity and commodity market is going to be vacated quickly and then what?

If any of you remember the thirties and a I really wish I didn't, you might have noted that gold mining stocks went beserk. Was this because of FDR's confiscation of gold? I think not. I think no one trusted the "new deal" and no one trusted the markets and the government's heavy hand in things and so what was left...gold mining stocks. I find this peculiar as certainly the citizens couldn't own much of it any more, so why the interest?

We, I feel, are about to witness the same phenomenon. Investors are going to get crushed soon and they will have no place to turn aside from gold. Once that is the mantra, the gold rush will start.

2009 Aug 04 02:35 PM

[The Recusant]

Spartacuss: You said a mouthful, fella! Please comment more often.

2009 Aug 04 02:45 PM

[5142152-337]

INMHO my sense of the current PMs (gold and silver, in particular) are that there is pressure being placed on the elitist greedy bastards (the banksters, JPM, GS, et al) by the CTFC that is causing them great concern--their shorts. Then you have the current economic disaster Obama is orchestrating coupled with the recent awakening of the sheeple to cease buying ETFs in favor of accumulating PHYSICAL gold and silver.
This all SCREAMS that the decades-long surpression of the commodities market is starting to unwind.

2009 Aug 04 03:31 PM

[m7m]

In past recessions, government, the people "we" voted in, easied the recession by creating a tax holiday, cutting personal and corp taxes. Now the current government is more interested in spending, spending and spending us into inflation for years to come. The business with spending is not going to ease the recession. It is going take even longer come out of it. What is the current government smoking. And what is this business with the government health care. No way. I am very happy with my health insurance and health care. Leave it be, don't spend any more!!! Someone hired them, not me. But we can fire them too, including me.

2009 Aug 04 06:30 PM