Gold

[elZorro]

Not sure what's driving the upwards spike overnight.

http://www.investing.com/analysis/al...caution-167691

[Skol]

No idea, maybe the 'bottom's in' EZ. Time to 'back the truck up'?

[Daytr]

Market was too short, positions at record levels short. So we have seen a typical short covering rally. The rally was so sharp & quick, I suspect there are a few still short hoping that we have seen the end of it. Doesn't seem like any particular news sparked the rally so shorts were obviously fairly nervous of the size of the position is my guess. Need to see gold back over $1400 to consolidate the move. Was that sarcasm above Skol? Or do you think that's possible that we have seen a bottom? I bought some more goldies yesterday, so hopefully it is the bottom & I have had a pick! haha

[Skol]

Investmend-demand.png

An exponential chart that is more than likely completely unsustainable.

And: the pointlessness of owning gold.

http://ftalphaville.ft.com/2013/05/1...-gold-bar-au/?

[Daytr]

I'll take that as a no Skoll ! LOL. Think you need to put your Eastern (as in Asian) hat on to get a perspective on why gold ownership is growing. So its not if you & I should or would own gold its if the growing wealth of the Asian populous think it is & they are saying yes. I prefer to own gold equities as I believe they will outperform as long as you pick the right ones of course (shameless plug for my fund haha) as stocks have on the way down.

[Skol]

I'll take that as a no Skoll ! LOL. Think you need to put your Eastern (as in Asian) hat on to get a perspective on why gold ownership is growing. So its not if you & I should or would own gold its if the growing wealth of the Asian populous think it is & they are saying yes. I prefer to own gold equities as I believe they will outperform as long as you pick the right ones of course (shameless plug for my fund haha) as stocks have on the way down.

That's what goldoz tried to do and it looks as if he's in trouble.

http://www.goldoz.com.au/home.0.html

[biker]

Hedge funds betting against gold
Date
May 20, 2013 - 10:08AM
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George Soros US Goldman Sachs
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Hedge funds are betting that a 12-year price rise in gold is over. Photo: Phil Carrick
Hedge-fund managers are making the biggest ever bet against gold as billionaire George Soros sold holdings last quarter and Goldman Sachs Group predicted more declines after the longest slump in four years.

Gold for immediate delivery lost as much as 1.5 per cent to $US1,338 an ounce, the lowest price since April 18, and traded at $US1,348 in Singapore this morning.

It's had a 12- year run, but the whole fear-mongering that the world is going to end is just not working. So, I think that any last vestige of an investment thesis for gold has been stripped

Prices are down for the eighth straight session, the longest slump since March 2009.

Gold mining companies listed on the Australian Securities Exchange make up seven of the ten worst performers this morning. Kingsgate Consolidated is down 7.6 per cent, Perseus Mining down 7.4 per cent and Silver Lake Resources 6.6 per cent. Evolution Mining, Alacer Gold, Medua Mining and Troy Resource are also down at least per cent.

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Gold has tumbled 20 per cent this year, falling into a bear market last month, as some investors lost faith in the metal as a store of value and equities rallied on confidence that the US economy was improving.

The Soros and Goldman Sachs funds and other large speculators held 74,432 so-called short contracts on May 14, U.S. Commodity Futures Trading Commission data show.

That's the highest since the data begins in June 2006 and compares with 67,374 a week earlier.

The net-long position dropped 20 per cent to 39,216 futures and options, the lowest since July 2007.

Gold prices that surged sixfold in the past 12 years fell 19 per cent in 2013, including a seven-session slump through May 17 that was the longest since March 2009.

"Gold has faced disappointment after disappointment," said John Stephenson, a senior vice president and fund manager at First Asset Investment Management in Toronto.

"It's had a 12- year run, but the whole fear-mongering that the world is going to end is just not working. So, I think that any last vestige of an investment thesis for gold has been stripped."

Prices Slump

Gold futures prices slumped as Federal Reserve regional bank presidents including Richard Fisher of Dallas and Charles Plosser of Philadelphia called for a reduction of US monetary stimulus.

Gold's slump "has been faster than we expected," Goldman analysts led by Jeffrey Currie wrote in a May 14 report.

A further drop in exchange traded products holdings would "continue to precipitate this decline," said the analysts, who forecast prices at $US1,390 in 12 months.

The metal will get "crushed" and trade at $US1,100 in a year and below $US1,000 in five years as inflation fails to accelerate, Ric Deverell, the head of commodities research at Credit Suisse Group said in London on May 16.

Bloomberg



Read more: http://www.theage.com.au/business/ma...#ixzz2TsCLLtwR

[Daytr]

It was the shorts that got crushed last night. Seems like Moody's commenting on a possible downgrade of the US was the catalyst. A lot of Bank analysts credibility on the line with their calls on gold especially the likes of Credit Suisse. What if the US is downgraded? Sovereign debt levels actually do mean something. What it means is US debt gets more expensive & interest costs go up & it could be the catalyst for a blow up in the Bond market if they aren't careful. Not saying that will happen, however some very smart people such as the likes of Kyle Bass have been calling for. The news of a possible downgrade will gather momentum & it will see a top out in the dollar &Y leaves the Fed in a hell of a quandary about what they do in regards QE. Watch out US stocks if this story grows legs.

[Skol]

I've watched the goldbugs catching the falling knife, many are on the road to ruin, but takes all kinds I suppose. Gold is headed much further south, Zerohedge and KWN still wheeling out the usual goldbug jargon- takedown, smashed, short squeeze, massive global debt, central bank buying, coming collapse, parabolic money supply etc.etc, all the usual BS to hoodwink the suckers into buying more gold.

Fact is the goldbugs are the biggest losers on Earth atm and will be for the forseeable future, but I always encourage them to 'back the truck up'.

Nothing goes down in a straight line, there's a lot of newbies out there who are gonna find out what a real bear market is like, many already have, squealing about huge losses, but the fun hasn't even started yet.

[Daytr]

That's all very true Skol, however & I am no gold bug & I can't stand KWN or the conspiracy theorists. However you seem to ignore the massive sovereign debt issues & printing of money. Could perhaps this latest rally in US equities be the final harrah before a mighty crash. People think they are so smart & ignore fundamentals or basic economic theory such as want printing money does & that is devalue the currency that is being printed. There are so many issues & the only thing that has driven US equity markets higher is a zero interest rate policy not economics or fundamentals. Its chasing yield & not wanting to miss out. Miss out on what? A share market that is ridiculously over valued being propped up by a government that is basically insolvent. The Fed has had little choice as the policy makers have no interest in resolving the real issues in front of them. Greed breeds contempt & that will be there downfall.