Precious Metals Run In Place
Apr 22nd, 2009 | By Doug Casey | Category: Financial NewsGold was flat until just before New York opened on Tuesday, when it made its big upmove for the day, rising all of $10 to peak at $895 before drifting downward into the noon hour and then going flat to finish at $883.30/oz., down $1.50. Overnight, gold is little changed.
Platinum held up in the far East, but slowly deteriorated after that, falling below $1150 halfway through the Comex, then inching back up to end at $1153/oz., down $9. Overnight, platinum is trending higher.
Silver was higher until the New York session, fell to just before noon, rallied back to the end of the Comex, but then declined again on the Globex to close at $12.06/oz., down 4 cents. Overnight, silver is slightly higher. (Click here for charts)
After a couple of days of sharp moves, the precious metals caught a serious case of the blahs again yesterday, with all of them ending essentially back where they started the day.
Gold might have picked up a smidgeon of support as the dollar inched lower against the euro, and as oil erased early losses to track equities higher, but neither provided enough lift to get the metal moving.
The day’s rebound in equities probably worked against gold, as well, with investors developing an appetite for stocks later in the day.
That led Bayram Dincer, a Dresdner Bank commodity analyst in Zurich, to assert that, “Gold’s price is very sensitive to the U.S. equity market’s trajectory … We expect this correlation to exist in the short term.”
Ralph Preston, of Heritage West Futures, added that, “Risk aversion in the gold market is taking hold as optimism reigns supreme that U.S. government officials will do all that is necessary to shepherd the economy through the valley of the recession.”
Whether “all that is necessary” actually turns out to be effective remains to be seen.
Gold-mining stocks began the day strong, but faded back into the red. Nevertheless, Eric Le Coz, a member of the investment committee at Carmignac Gestion in Paris, said that they like the miners. “Because the recession will be prolonged in the advanced economies, you want to have some kind of insurance in the fog, and gold-mining equities are the best ones,” Le Coz said.
Source: Precious Metals Run In Place
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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.