Gold Holds Firm
Jul 22nd, 2009 | By Doug Casey | Category: Gold MarketGold traded sideways through Hong Kong and most of London then surged up to an intraday high of $953 at around 9 a.m. in New York only to completely erase the gains less than an hour later. From 10 a.m. through the Comex close gold showed a steep downward trend but reversed course and made up most of the day’s losses on the Globex, finishing at $949.00/oz., down $0.10. Overnight, gold has moved lower.
Platinum fell off a cliff late in Hong Kong but clawed back early in New York only to get smacked down again beginning around 10 a.m. in New York and continuing through the Globex, closing at $1170/oz., down $11. Overnight, platinum is trending lower.
Silver hit its intraday high of $13.70 about midway through Hong Kong then developed a volatile but generally downward sloping trend and fell to its intraday low of $13.45 around 1 p.m. in New York. From there silver was able to regain some ground through the Globex to close at $13.53/oz., down 10 cents. Overnight, silver is down sharply. (Click here for charts)
Gold was propped up by higher oil prices yesterday but that upward force was slightly overpowered by investors’ naïve belief that the Federal Reserve will be able to combat future dollar devaluation and price inflation.
Still, analysts like Shuji Sugata, a manager at Japan’s Mitsubishi Corp Futures & Securities, said crude oil is currently a key factor in providing gold with direction.
“We’ve seen crude oil climb almost daily and before we knew it it had topped $60, which has been a positive factor for gold,” Shuji said.
“Now whether crude oil challenges $70… will also be key to whether gold will rise towards its recent high near $990,” he continued.
Meanwhile, reported holdings of SPDR Gold Shares (NYSE:GLD) dropped 2.13 metric tons yesterday from 1,094.54 tons to 1,092.41 tons. In the last 30 days, holdings have fallen 38.83 metric tons, or 3.4%.
In company specific news, Australia’s largest gold producer, Newcrest Mining’s annual gold production fell more than 8% over the past fiscal year, only just meeting company guidance.
Newcrest’s latest production report showed total gold production across its operations fell to about 1.63 million ounces, compared to about 1.78 million ounces last year, a fall of 8.4%.
Newcrest shares fell 57 cents, or 1.84%, to $30.39 on the news.
Doug Casey is a contrarian investor, sought-after public speaker and author of several books. His work "Crisis Investing" held the position of # 1 bestseller on the New York Times list for 26 consecutive weeks. Doug's unusual views on the economy - and just about everything else - have gained a huge following in the investment community, and it certainly helps that his stock recommendations of undervalued junior exploration companies have made his subscribers millions. Now in its 27th year, Doug's monthly newsletter, the International Speculator, is one of the most established and esteemed publications on gold, silver and other natural resource investments. Together with the Casey Energy Speculator, it covers a broad range of carefully selected stocks with the very real potential of double- and triple-digit returns within 12 to 24 months.