Precious Metals Battered, Oil’s Losses, Dollar’s Strength the Cause
Aug 5th, 2008 | By Doug Casey | Category: Financial News, Gold MarketThe precious metals suffered another beating Monday as gold, silver, and platinum all suffered sharp losses during the day’s trading. Gold rose for a short while in the Far East, but soon lost its early momentum at the start of trading in London.
With the exception of a brief rally during NYMEX trading, gold trended down for the rest of the day and broke past the $900 barrier to finish at $893.80/oz., down $15.90. Overnight, gold slipped further.
Platinum followed up its huge losses on Friday with another huge decline. The metal traded relatively flat in early trading, but prices plummeted just before the opening of the NYMEX. Platinum finished just off its intraday low, down $79, at $1,551/oz. Platinum trended lower in overnight trading.
Silver, like gold, posted small gains in Far East trading, but traded down the rest of the day. A short-lived rally during the NYMEX was cut short as prices dropped almost vertically to break below $17/oz. Silver closed at $16.89/oz., falling $0.56 on the day. Overnight, silver prices slipped.
(Click here for charts)
The sharp losses for the precious metals were caused by the usual suspects: declining crude prices and a strengthening dollar. Of these, crude probably had a greater impact as it dipped below the $120 a barrel mark.
“Gold has now decisively stepped into sub-$900 territory as crumbling oil values and fears of a nearer-term Fed response to the rising inflationary pressures bolstered a dollar which had already looked predisposed for incremental gains,” wrote Jon Nadler, of Kitco
“Analysts who had foreseen a decoupling by gold from crude oil got a rude awakening today when black gold dipped to under $120 and augmented the slide in various commodities,” Nadler concluded.
These developments served to decrease the appeal of the precious metals, and commodities in general, as a hedge against inflation.
The Hightower Report summed up the day’s trading, stating simply that “all things considered the gold market simply had a long laundry list of bearish developments at the start of the new week.”
Source: Precious Metals Battered, Oil’s Losses, Dollar’s Strength the Cause
Advertisement
While most people are being decimated by the ongoing market collapse, a small group of smart folks are turning the market plunge into big gains of 224%... 279%... 214%... 291%... and more! Here’s how to turn the market crisis into your personal profit machine. First come, first served… so reserve your space now…
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.