Gold’s “breaking out” to a higher level as imminent, Chris Locke, managing director at Oystertrade.com Management, told CNBC Wednesday, as other analysts have said the precious metal could shine again as inflation fears resurface.
“We’re on this point of the market making a substantial move to the upside,” Locke said.
“We will see the market move through the bull market highs of $1,040 very, very quickly,” he added.
The S&P 500 index has maintained its uptrend from the March lows and the next target for it is 1,050, Locke said. But for the fall period, Locke sees the index weakening.
Locke told CNBC he’s been looking for a signal that the U.S. index will peak in August before correcting slightly, but that signal hasn’t occurred yet.
But he said he’s “seeing some kind of loss of momentum to the upside” and therefore predicted that the September to November period “will be weaker” and will test the levels below 950.
He also sees sterling reaching “levels towards parity” against the euro, at 95 cents. “Sterling looks the most vulnerable to me,” he said.
FRANKFURT – Scientists say a Roman horse head made from bronze and plated in gold has been discovered at an archaeological site in Germany.
Hesse state archaeologist Egon Schallmeyer says the head is part of a horse and rider statue and “qualitatively one of the best (pieces) created at that time.”
The ornamented, well preserved head was found earlier this month at the Waldgirmes excavation site in central Germany and displayed Thursday at the German Archaeological Institute in Frankfurt.
Archaeologists have been digging since 1993 at the site, a Roman city during the reign of Emperor Caesar Augustus from 23 B.C. to 14 A.D.
Other parts of the life-sized statue were found earlier and include a foot and a decorated chest strap.
Gold prices could set new record highs above $1,030 an ounce in 2009 as investors flock to the precious metal as a hedge against future inflation and a weaker dollar, according to a leading fund manager. Investec Global Gold Fund’s portfolio manager Daniel Sacks said a combination of safe-haven buying of gold as an alternative to paper currencies, inflation, and a dearth of fresh mine supply in response to rising prices are set to boost bullion this year.
“We believe gold will continue to perform well in 2009 against most assets and, in U.S. dollar terms, should attempt a breach of the 2008 highs of $1,030 an ounce,” he said.
The precious metal hit that level in March last year as a sharp slip in the dollar fuelled hefty gains. Dollar weakness tends to push investors towards hard assets, such as gold.
…Further down in the article…
Gold has rallied in recent weeks as dollar weakness boosted investment in hard assets, hitting a two-month high of $971.25 an ounce late last week.
The metal has also been lifted by expectations a global economic recovery could lead to inflation, after governments around the world pumped liquidity into the financial markets earlier this year to kick-start lending.
“The macro case for owning gold remains strong: inflation expectations rising, and short rates to remain extremely low,” he said. “Inflation expectations…have trended steadily higher since fears of deflation peaked.
The complete article can be read here.
I read a USAToday.com article containing the following quote: “Gold coins are selling like hot cakes.” My point for posting the previous quote is to show that even during a recession, precious metals rise in value. With prices dropping on everything from, cars, to homes to employee income, gold, silver and other precious metals are not just holding a strong value, but excelling. Investors and collectors are realizing that gold is a key commodity. And they are spending what it takes to obtain as much gold, silver and other precious metals as possible. They are investing not just for the long term, but investing to earn a quick profit as gold value keeps rising. I personally believe gold is one of the wisest long term investments, but recently I am starting to see that it can be a very profitable short term investment. Who knows, maybe the new fad will be flipping gold.
Article clipping via Wall Street Journal
NEW YORK (Dow Jones)–Gold futures rallied Friday on a sharply weakening U.S. dollar as participants bought back previously sold positions. December gold rose $18.50, or nearly 2%, to settle at $955.80 an ounce on the Comex division of the New York Mercantile Exchange. “It’s definitely about the buck,” said Frank Lesh, broker and futures analyst with FuturePath Trading. The ICE Futures U.S. dollar index hit its lowest point since December. “That new low in the dollar is the big driver here,” Lesh said.
Gold is often bought as an alternative currency to hedge against greenback weakness. The dollar fell as the euro and other higher-yielding currencies benefited from resilient stocks and the stronger Chicago purchasing managers’ index. At the same time, worrisome signs in second-quarter gross domestic product underscored calls for a different safe haven than the dollar. “The dollar’s getting creamed right now,” said Patrick Donnelly, a broker with Peak Trading Group.
Technical purchasing also was supporting gold as buy stops were triggered, Donnelly said. “We hit some stops,” said Andrew Montano, director of precious metals at Scotia Mocatta. “It’s short-covering mostly.” Silver futures gained with gold as the U.S. dollar tanked, Lesh said. Comex September silver rose 45.5 cents to settle at $13.940 an ounce.