Precious Metals Move Higher in Thin Pre-Holiday Trading
May 26th, 2009 | By Doug Casey | Category: Gold MarketGold had a boring, if mildly positive, day on Friday, as many traders left their desks to get a jump on the Memorial Day weekend, locking the metal up in a tight range between $950 and $960, leading to a finish at $956.50/oz., up $2.60. For the week, gold added 2.8%.
Platinum fell off in the far East, rebounded to the New York open, then traded choppily through the rest of the day, to little ultimate effect as it ended at $1153, up $4. For the week, platinum was up 4.7%.
Silver was also off in Hong Kong, but rose sharply in Europe, peaking at $14.81, then traded inside a 20-cent range for the rest of the day, closing in the middle at $14.69, up 14 cents. For the week, silver gained a robust 5.3%. (Click here for charts)
The precious metals did well, holding onto their gains for the week in light trading ahead of the holiday weekend. The usual suspects did their part to provide support, with oil rising and the dollar falling again.
Of the two, “The gold price is predominantly driven by the dollar weakness at the moment,” said analysts at CommerzBank. “As long as the dollar remains on the back foot, gold should continue to rise.”
As has been the case for the past seven sessions, with gold pushing higher, holdings in the Gold SPDR Trust, the largest metal-backed ETF, haven’t budged. That has some wondering why, but in the end GLD is still a stock, not physical metal.
Looking ahead, Julian Phillips, of Goldforecaster.com, is highly bullish, writing that, “Gold has broken out of its long consolidation and looks set to take on $1,000 again.”
Phillips takes on the historical question, saying that, “This time of the year the gold market moved into the ‘summer Doldrums,’ but the last two years has seen this seasonality fade as investment demand knocked away this seasonality. With Indian buyers virtually absent from the international gold market since October 2008 until April this year we could have expected ‘Doldrums’ during that time. Now their absence is unnoticed as investment demand took the reins of the gold market and looks like holding them. So expect those Trade Winds to blow during summer and make the gold market an exciting place to be.”
The proper stars do seem to be aligning.
Source: Precious Metals Move Higher in Thin Pre-Holiday Trading
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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.