Gold prices, miners surge on debt deal, QE hopes


Gold futures (GLD +3.2%) settle more than $40/oz. higher, boosted by the belief that the debt default deal might prompt the Fed to delay reducing QE.

"The U.S. debt deal is seen (as) positive for gold by market participants, for good reason, since the whole mess is just being postponed by 3-4 months, which makes a reduction of Fed asset purchases rather unlikely for the time being," Commerzbank says.

Many probably believed gold would fall if there was no debt default, so a short squeeze likely is helping force prices higher.

Among the day's biggest equity gainers are gold miners (GDX +6.2%): NEM +4.8%, ABX +5.4%, GG +4.2%, GFI +3.9%, RGLD +7.1%, KGC +4.9%, NGD +5.3%.

ETFs: IAU, SGOL, PHYS, AGOL, DGL, UBG, DGP, UGL, DZZ, GLL, DGZ, UGLD, DGLD, GLDI, GDXJ, GLDX, PSAU, NUGT, DUST, GGGG, RING.

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Comments (11)
  • Doug Eberhardt
    , contributor
    Comments (4690) | Send Message
     
    What happened to Goldman Sachs call for lower gold prices once the debt deal was reached?

     

    Republicans are toast by giving in. (I'm neither)

     

    The Fed is toast too...(eventually): The Federal Reserve - Lender and Buyer of Last Resort http://bit.ly/17uF19T
    17 Oct 2013, 03:25 PM Reply Like
  • DeepValueLover
    , contributor
    Comments (10750) | Send Message
     
    Goldman made their "call".

     

    Gold fell out of bed.

     

    Goldman swooped in and bought tons of GLD calls.

     

    ...wait a couple of weeks...

     

    Boom.

     

    Goldman most likely sold out today @ 15:58:59 at a sharp profit.

     

    Goldman wins again.
    17 Oct 2013, 06:00 PM Reply Like
  • Doug Eberhardt
    , contributor
    Comments (4690) | Send Message
     
    DeepValue...when you are a Market Maker, do you ever lose money? Seriously....

     

    But if you know how they work, you, if you are indeed a small player like 99% who read SA, might make money. Might.

     

    Most don't know how the system works and how it is stacked against them. Maybe you do. Great.

     

    Most don't.

     

    But if you have a trade to make, let us know what it is so we can all profit. I sold half my NUGT today for a nice gain and am looking at DUST while holding some NUGT. How can that be?

     

    Meanwhile, I recommend and hold physical.
    17 Oct 2013, 09:01 PM Reply Like
  • ltsgt1
    , contributor
    Comments (1590) | Send Message
     
    I made donation to Fisher House, Ted Cruz, Mike Lee and Rand Paul in the last few days. I will donate to whomever running against John McCain, Mitch McConnell and Harry Reid.

     

    The Fed is toast. We are toast when China forgives the trillion dollar debt.
    17 Oct 2013, 10:38 PM Reply Like
  • NadgesNokindo
    , contributor
    Comments (45) | Send Message
     
    Doug, fear not, the miner sell calls by banks and negative outlooks for PMs are on their way shortly. Gold outlooks to be reduced to $900, silver to $16...meanwhile, they'll be buyers.

     

    The Fed will come out and indicate higher growth forecasts and renew the taper talk.

     

    It's such an easy scam to monitor now.

     

    Keep buying dips.
    17 Oct 2013, 03:41 PM Reply Like
  • Doug Eberhardt
    , contributor
    Comments (4690) | Send Message
     
    Nadges...you may be right.
    17 Oct 2013, 05:12 PM Reply Like
  • filipo
    , contributor
    Comments (4540) | Send Message
     
    When looking at today's surge of the gold price, I have a faint impression that some shorters have burned their a** and had to hastily reshuffle their positions.
    The next week will tell us more. If the gold price can consolidate on this level, a push higher in November is very likely. If not, the price will level around where he is now.
    I wonder if the deal between the GOP and Obama could have something to do with gold and irresponsable Fed spending. I would like to know all the details of that deal.
    17 Oct 2013, 03:55 PM Reply Like
  • Ordinary Average Guy
    , contributor
    Comments (1368) | Send Message
     
    I think the bigger catalyst for this current gold move would be the expansion in the US Federal debt limit.

     

    I don't expect the gold price to drift too high before we start seeing large naked short sells at the pre-planned dates/times, much like we have seen routinely for awhile now which trigger stop selling to head off any gold rallies.

     

    Until the US Gov't/Fed exhausts their ability to contain the gold price, I don't see any gold bull breaking through. There will be a time in the future that this price suppression is over-run by stronger bulls, then lookout above. The big question is how long can this price be held down by the US Gov't? Weeks? Months? Years?

     

    I don't think that the gold price will be pushed below production cost levels, as least not for any long periods. I do think the gold price will be contained close to where it is currently until the US Gov't is unable to manage this, or until the upcoming equities crash which also could take some time to happen. But, it will happen.
    17 Oct 2013, 09:07 PM Reply Like
  • filipo
    , contributor
    Comments (4540) | Send Message
     
    Ordinary,
    "I do think the gold price will be contained close to where it is currently until the US Gov't is unable to manage this, or until the upcoming equities crash which also could take some time to happen."
    ...... or until paper contracts have kept the price so low, that people see no advantage anymore to sell their physical gold and other people can't get the physical gold they want to buy.
    That will be the moment of true gold shortage.
    18 Oct 2013, 03:10 AM Reply Like
  • Doug Eberhardt
    , contributor
    Comments (4690) | Send Message
     
    My suppliers have had a slow month filipo....I still see some downside ahead till end of year. My next article will explain my position more.

     

    Of course I am bullish long term....for a multitude of reasons.
    18 Oct 2013, 12:53 PM Reply Like
  • filipo
    , contributor
    Comments (4540) | Send Message
     
    Doug,
    I don't know whether you can extrapolate the US situation and nowadays lack of US gold appetite to the general gold market.
    I'm anxious to see what India will do Q4.
    As for China, they have imported 2,116 Tons from Jan2011 till Sept 2013:
    http://bit.ly/19eRotN
    That staggering amount of gold comes mostly from the slacking American market.
    Besides, there seems to be a real gold short squeeze, as the negative gold lease rates indicate:
    http://bit.ly/19eRoK2
    My personal experience is similar: it is utterly impossible here to get gold delivered in due time, meaning less than 2 months.
    Having said that, you and I know that as long as the manipulators keep on doing God's work by slamming the gold price on Comex with US taxpayer's money, that gold price will stay subdued.
    And I don't mention India where premiums have soared to over 100%:
    http://reut.rs/19eRnWC
    18 Oct 2013, 02:12 PM Reply Like
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