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Archive for 18/04/2011
Spike was brief, and the tipping point
18/04/2011 by Philinje.
Gold and silver spiked up then down, and silver went a bit lower than its starting point, but both seem to be settling down - or rather, up. Quite possibly the highs for the day are in. But it’s hard to imagine they won’t move higher again soon.
Here is an interesting article about what may one day be seen as the tipping point for gold:
http://www.zerohedge.com/article/golden-tipping-point-university-texas-takes-delivery-1-billion-physical-gold
The second-largest academic endowment in the US has just taken delivery of 1 billion dollars of gold bullion. That is amazing, and this author speculates that this will cause a chain reaction among institutional investors. That would cause the most interesting market behavior, because paper gold exceeds physical gold by a factor of 100!
Something like this could be what finally causes a run on gold and a default of the Comex. This is not necessarily good for holders of paper gold, so be warned.
Posted in Gold, General | Print | No Comments »
Bad currency, badder currency
18/04/2011 by Philinje.
Isn’t this interesting. The Euro was in trouble on renewed worries about Greece, and then S&P downgraded US debt. So the Euro stopped sinking against the dollar and guess what? Gold spiked! That was a picture perfect postcard to send home to momma.
What I mean by that is the declining spiral of all currencies is really what is driving the precious metals higher. On a day-to-day basis, it’s not so obvious. But on a day like today, it couldn’t be more obvious. The dollar has been losing its luster as a safe haven. And as that happens, the Euro is the main alternative. But the Euro ain’t that great either.
Some folks might be of the opinion that the spike highs are gonna be it in terms of targets for this week. Heck, silver is not so far from a monthly target of $44.27. If gold gets over $1500, then yes, maybe it’s time to look at a partial exit. But on the other hand, this could be the beginning of a severe decline in equities and a general disgust with both dollars and Euros. So who knows how high gold and silver could go? If we get a convincing close in gold over $1500 sometime soon and stay there, I think $1600 and $50 come into play, for sure.
Posted in Gold, General | Print | No Comments »