Precious Metals Slide More
May 15th, 2008 | By Doug Casey | Category: Gold MarketGold was tightly rangebound from the overseas markets straight through the NYMEX and Globex sessions on Wednesday, bouncing between $860 and $870, and finishing at $864.40, down $1.30.
Overnight, gold has edged higher in the overseas markets.
Platinum fell as low as $2000 in Hong Kong, but came smartly off that low even though it never made it back to break-even, ending at $2032/oz., down $18. Overnight, platinum has fallen off.
Silver pushed well into the black above $16.80 at the New York open, but then was sold off steadily for the rest of the day, closing at $16.49, down 19 cents. Overnight, silver has been pushing higher.
(Click here for charts)
It was another grind-it-out day for the precious metals, as they struggled to keep their heads above water with both the firm dollar and declining oil moving against them.
The Hightower Report wrote of the day’s tepid action: “The gold market mostly favored the downside in the action on Wednesday which initially seemed to be the direct result of ongoing strength in the US Dollar. However, gold prices did manage to bounce by as much as $6 an ounce off their post report lows with the still mostly Dollar holding in positive ground. The currency trade continues to suggest that a close above the 74.00 level in the June Dollar Index is an extremely critical level and it appears that the gold market is also watching that level as well. In the end, the bull camp in gold might suggest that prices held up relatively well in the face of minor Dollar strength and moderate weakness in oil prices. In fact, a number of physical commodity markets were under pressure Wednesday and even that didn’t seem to add to the initial weakness in gold prices.”
At this point, fundamentals to the contrary, one would have to admit that the bears are pretty much in control.
“There’s no buying interest in gold at the moment,” Matt Zeman, of LaSalle Futures Group in Chicago, stated flatly. And, “The CPI coming in tamer than expected is not going to help,” he added.
And, “I would look for the buck to continue firming,” said Ralph Preston, an analyst at Heritage West Futures in San Diego. “A test of $850 appears to be in the cards for gold on the back of the inflation numbers.”
But on a more upbeat note, Société Générale said in a recent report that while chart analysis shows silver will be little changed to lower during most of May, the price will average $20.25 an ounce in the second quarter. That would be quite a rally.
Source: Precious Metals Slide More
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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.