Thursday, September 29, 2011

Why the Gold Price Falls

The price of gold back down for the fifth time in six sessions as the dollar reversed course (rebound). The condition is reducing demand for gold as an investment alternative. Currently people to trade gold as a commodity.

Trading gold futures for December delivery fell 34.40 U.S. dollars or 2.1 percent, to USD 1618.10 at 13:43 am local time on the COMEX, New York. Gold prices were down 16 percent from a record price of 1923.70 on September 6. While the U.S. dollar rose 0.7 percent today against a number of other currencies.

Factors that influence the price of gold
Past, Gold is one of the instruments to be hunted when economic conditions worse to secure investment because the price tends to be stable or becomes hedging instruments when the economy improves to protect the investment from the surge in inflation. But lately the function of gold in the big picture began to change somewhat even function as a safe haven and hedging is still an impact.

Gold price in recent months is influenced by various factors, such as the U.S. dollar devaluation, diversification or changes in foreign exchange reserves, the risk appetite on assets such as commodities and concerns on inflation.

One of the biggest factors affecting gold price is a commodity market, which trade commodities like crude oil products, sugar, coffee, soybeans and others. Rise and fall of gold price tend to be on the steering wheel by the performance of commodity markets.

In recent months the market is driven by the risk appetite and avoid risks. When the appetite to increase the risk of market players get into some of the financial sector, such as stocks, currencies, yielding a high return and commodities.

Usually this risk appetite increased when the market expect the global economic conditions improve and vice versa, if the market is unsure of the economic conditions they fled to safe-haven assets or chasing the U.S. dollar. In this space a lot of moves in gold price is more likely to follow commodity markets than the problem of safe-haven or hedging positions.

Friday, September 16, 2011

Gold Price Drop Sharply

Futures gold trading fell sharply. Why is gold price drop sharply? There are many reason which affect the current gold price.

China's financial support plan to help Europe's debt crisis. China was reported to be buying some bonds from countries affected by the crisis. This situation will reduce demand for precious metals.

The price of gold drop to its lowest in three weeks, as a signal that European banks have the funds until the end of the year, thus eroding the concern that the crisis in the region could get worse.

European Central Bank (ECB) in coordination with international policy makers, providing loans in the form of U.S. dollars to banks as an aid in the face of the credit crisis. Conversely, stocks actually go up in the United States and Europe, along with Germany and France to ensure that Greece would remain a part of the European Union. Moreover, China plans to buy bonds in Euro.

The decline in gold prices is a sign of a spontaneous reaction to the statement of the ECB, where people see as something positive for the European economy.

In trading on the Comex, New York, at 1:56 PM local time, on the trading price of gold futures for December delivery drop USD 45.10 or 2.5 percent, to price position of USD 1781.40 per troy ounce (equivalent to 31.1 grams). Earlier, gold had touched lows on August 26, 2011, at the position of USD 1775.

Tuesday, September 13, 2011

Gold Price Fell Back

Along with the fears of Greece potential default on its debts, the gold price has decreased. This decline took place from Saturday (09/11/2011). This is due to action of the investors who sold the precious metal to cover losses in other investment instruments. The price of gold for quick delivery dropped 0.7 percent to 1842.25 U.S. dollar positions per troy ounce (equivalent to 31.1 grams), and reached 1847.70 U.S. dollars in trade in Singapore. Though the price of gold briefly hit 1921.15 U.S. dollars per troy ounce on September 6.

In contrast to the general conditions, the price of gold for December delivery in New York, which is usually contrary to the U.S. dollar, rose by 0.8 percent from USD 1850.20 to USD 1844.60 per troy ounce. Gavin Wendt, founder and director of Mine Life Pty said that the U.S. dollar currency has been sold quite significant, but he can not see it continuously as the U.S. has got a big problem that needs to be resolved.

Gold futures trading fell for the first time in three sessions as traders who sold the precious metal. This was done to cover the falling stock losses for fear of escalating debt crisis of Europe. Globally, stocks fell on speculation of Chancellor Angela Merkel's preparations against Greece in default. Thus leaving a space for the global stock market to be in poor condition.

In contrast to the conditions of gold, the dollar has strengthened to its highest level in six months against six major currencies. In fact, in this September, gold prices had touched a record 1923.70 per troy ounce on September 6, 2011. And now, gold scored a record price in Euro and Swiss francs.

To note, the price of futures gold for December delivery fell 46.20 U.S. dollars or 2.5 percent, to 1813.30 in trading on the Comex, in New York, 1:30 local time on Tuesday (13/09/2011).

Gold has been in market conditions continued to rise for 11 years. An ultimate victory since 1920 in London, along with the diversification of investors other than equities and currencies. The growth of the gold price has reached 28 percent this year, defeating global stocks or commodities. Overall, the gold price has grown 30 percent this year.

Gold prices expected to fall below 1700 U.S. dollars per troy ounce in September 2011. However, the price of precious metals is also estimated to be re-spiked to reach U.S. $ 2,000 price level in October.

Thursday, September 8, 2011

Gold Price Down Up to 3%

The court decision in Germany is expected to help resolve the crisis in European kept investors excited hunt shares again. German court rejected a lawsuit to block the country's desire to join in efforts to provide aid to Greece and other countries affected by the crisis. European and U.S. exchanges also immediately rocketed by the decision.

Investors dumped gold and hunted stocks and thus make the price of gold fell to 3%. In trading Wednesday (09/07/2011), price of gold in the spot market recorded falls of up to U.S. $ 57 to U.S. $ 1,815 per ounce, even had time to hit the lowest record intra day at U.S. $ 1793.19. The decline in gold price came after the gold price had hit the highest record of U.S. $ 1,920 per ounce on Tuesday.

In the futures markets, gold for December delivery also fell U.S. $ 55.70 to U.S. $ 1,817.60 per ounce, and moving in the range of U.S. $ 1,883.20-US $ 1,793.80.

On Tuesday, gold price hit the highest a record at U.S. $ 1,920.30 per ounce after the Swiss Central Bank decided to fix its currency against the euro in order to prevent further strengthening. But after marked a record, gold price has corrected immediately. Although a liquidation, but analysts said gold was still in a rally position because -likely to the intervention of the Swiss central bank, others central bank will seek to compare with it to prevent its currency to appreciate too much.

Efforts to resist currency appreciation means that gold will move higher because it is considered as safe havens.

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