GOLD INVESTING

For centuries, buying gold has been recognized as one of the best ways to preserve one's wealth and purchasing power. Gold is a unique investment, one that has served mankind well for thousands of years. From the times of ancient Egyptians, Greeks and Romans to more modern times, man has been fascinated with the beauty and magic of gold, and with its power to change men's lives.

Gold bullion is real, honest money...and, many say, the best form of money the world has ever known. It is a store of value and a safe haven in times of crisis. Gold is rare, durable and does not wear out in the manner of lesser metals (or paper!) when passed from hand to hand. A small amount, easily carried, can purchase a significant amount of goods and services. It is universally accepted, and can be easily bought and sold around the world.

Today, the beauty of a gold bar lies in its ability to diversify investments, protect wealth and preserve one's purchasing power.

Source: http://www.monex.com/prods/gold.html

Gold Can Still Reach New All-Time Highs This Year

January has been a difficult month for gold, so much so that many market mavens - analysts and investors alike - are abandoning their bullish expectations.

From its year-end 2010 price near $1,420 an ounce to its recent low just over $1,320 gold has so far shed some $100 - about seven percent.  Measured from its all-time high just over $1,432 in early December, the recent decline is less than eight percent.  Either way, in percentage terms, this doesn't amount to much of a correction in the metal's 10-year old bull market.

BRIGHT FORTUNES

In contrast to gold's naysayers and born-again bears, I believe gold's fortunes remain very bright.

What's more, recent market activity, rather than signaling an end to gold's decade-long advance, strengthens the case for a sharp snapback in the metal's price and new all-time highs later this year.

Indeed, with gold's fundamental price drivers all remaining supportive, I expect another strong advance over the months ahead - with the yellow metal rising to $1,700 an ounce by year-end 2011.  While this seems like a lofty target, it amounts to "only" 19 percent above the recent market lows and is dwarfed by last year's 29-percent annual gain and the even bigger 32-percent advance registered in 2007.

EURO TRIGGER

Much of gold's price action in recent months has been triggered by the ebb and flow of "safe-haven" funds into and out of the euro.

Whenever Europe's sovereign debt problems worsened or the life span of the European currency seemed more uncertain, a flight of capital and speculative funds out of the euro into both the dollar and gold - perceived as "safe havens" - gave both the greenback and the yellow metal a boost.  And, whenever sovereign debt fears subsided, safe-haven demand for the dollar and gold diminished.

Historically, gold and the dollar have typically moved in opposite directions:  Think weaker dollar, stronger gold; stronger dollar, weaker gold.

But lately, the two have moved up and down together like Siamese twins - rather than in opposition as history suggests.  We can now see why: Both gold and the dollar are being driven up and down together as confidence in the euro waxes and wanes.

To the detriment of both gold and the dollar, a number of developments have come together in recent weeks to boost euro confidence and push the currency to a two-month high.  The list includes:

·         A spate of better-than-expected economic indicators,

·         The successful refunding of sovereign debt by Portugal and Spain,

·         Strong demand for the euro-zone rescue fund's first-ever bond issue, and

·         Tough anti-inflation talk from European Central Bank President Jean-Claude Trichet.

This good news won't last forever.  Instead, significant economic and social disparities between the stronger "core" economies (led by Germany and the Netherlands) and the weaker "peripheral" economies (such as Iceland, Ireland, Portugal, Spain, and Greece) will continue to threaten the viability of Europe's common currency.

Sooner or later another funding crisis will trigger a new wave of capital flight seeking a safe haven in the dollar . . . and gold.

WHO'S SELLING . . .

To understand where gold prices are headed this year, it is important to recognize that most of the selling in recent weeks has come from U.S. and European short-term institutional traders and speculators - banks, trading firms, commodity funds, and hedge funds - operating mostly in derivative markets, some simply taking profits, others betting on the downward momentum of the market, and many reacting to the reversal of "safe-haven" funds that late last year sought security in U.S. dollar assets and gold.

These players have no long-term view of gold and certainly no allegiance to the metal as an inflation hedge, store of value, portfolio diversifier, insurance policy, and traditional savings medium.  They simply sense a profitable trading opportunity.  Today gold is in their sights.  Tomorrow, it may be petroleum, cocoa, rice, steel or long-term U.S. Treasuries.  And, one day they will be buying gold again.

. . . AND WHO'S BUYING

In contrast, strong physical demand not only continues but may very well have picked up as lower price levels attracted bargain hunters.  Much of the buying has come from Asian markets - China, India, and other countries where gold has great cultural appeal as a store of value, savings medium, and harbinger of good luck and prosperity to those who hold it.

Big premiums (over New York and London prices) on gold bars in Hong Kong, Mumbai, and other gold-trading centers across the region indicate a shortage of physical metal as refiners struggle to meet strong demand for the various bar sizes popular in the Asian markets.

It is also likely that some central banks are taking advantage of the current price decline, quietly adding to their gold reserves or accelerating their purchases.  Likely buyers include the People's Bank of China, the Bank of Russia, and possibly one or more of the reserve-rich oil-exporting countries.

In fact, all of the central banks that have bought gold in recent years today remain significantly underweighted in gold.  All still hold the lion's share of their official reserves in U.S. dollar securities . . . and all have an incentive to buy gold on major price declines.

STRONG HANDS

Significantly, this dichotomy between buyers and sellers means that gold is moving into very strong hands and much of this metal is unlikely to come back to the market anytime soon.

Buyers in Asia are mostly long-term holders, often for a lifetime.  Similarly, many of the retail and wealthy buyers of bullion coins and small bars in America and Europe are motivated more by fear than by greed and are likely to retain their physical gold holdings for years to come.

As a result, when the current wave of selling abates, gold will have the potential for a swift and sizable recovery - all the more so if these same players view the metal as an attractive vehicle for trading and speculation on the long side of the market.

Source: http://www.mineweb.com/mineweb/view/mineweb/en/page33?oid=119292&sn=Detail&pid=102055

Gold Could Possibly Bounce Next Week - Allen Sykora And Debbie Carlson - Kitco

After spending the first two weeks of the year weaker, gold prices could be ready for a bounce, especially if the markets return to worrying about European debt.

February gold futures prices settled at $1,360.50 an ounce on the Comex division of the New York Mercantile Exchange, down 0.6% on the week. March silver futures settled at $28.32 an ounce, a fall of 1.2% on the week.

Several successful bond auctions this week by economically shaky southern European countries – Portugal, Spain and Italy – temporarily eased some of the fears about sovereign debt among peripheral nations. That took away some of the safe-haven demand for gold, said Adam Klopfenstein, senior market strategist with Lind-Waldock. Further asset allocation as investors finished rebalancing commodity indexes also caused some movement out of gold. 

China’s central bank announced a rise in the reserve-ratio requirement, due to take effect on Jan. 20, which also pressured prices on Friday. 

But once the impact of the Chinese move fades, the market could start worrying again about the longer-term European structural debt problems. This is likely to become a background factor offering support again, Klopfenstein said.

“That’s going to give gold more flight-to-quality buzz. I think gold is going to approach $1,400 next week,” Klopfenstein said. “Anything from there will be based on market momentum. But I do think we’re going to have a strong rally next week.”

He described this week’s European bond auctions as “delaying the inevitable,” or further crises.

“Until we get a clear resolution of the European debt situation…that will be in the backdrop,” Klopfenstein said. “And as long as that is the case, gold will be well supported. I don’t expect a major drop below $1,350.”

Spencer Patton, president and founder of Steel Vine Investments, also doesn’t see the European debt situation going away anytime soon. “There’s never been an unsuccessful auction in the past, but rates are still too high to be sustainable. Even in countries that got bailed out, auctions are successful, but rates are unsustainable to float debt,” Patton said.

Charles Nedoss, senior market strategist with Olympus Futures, looks for gold to bounce next week on technical-chart factors, since the market is range-bound but currently closer to support underneath the market than the resistance above. Furthermore, he said the dollar index looks technically negative, and further declines would be supportive for gold.

February gold has been turned back lately from chart resistance at the 10-, 20- and 50-day moving averages, which all lie roughly in the area from $1,384.50 to $1,388.50, he said. 

But at the same time, the metal is showing signs of holding support on the basis of a weekly chart, Nedoss said. This includes last week’s $1,352.70 low, which roughly coincides with the 20-week moving average around $1,350. 

“I think we’re starting to get to the low end of the range here and start to work higher next week,” Nedoss said, although there might be a “fight” once it gets back to the daily moving averages currently in the $1,380s. “I think eventually – maybe not next week but over the course of the next couple of weeks – we’ll take those levels out and we’ll see the dollar (index) take out the 79.00 level.”

Patton is keeping an eye on a possible head-and-shoulders formation on February gold charts. He said it’s not a perfect technical chart pattern, but he points to two left shoulder tops from October and November, the head being the high from early December and the right shoulder the late-December/early-January highs.

The neckline of that asymmetrical pattern comes in around $1,360. If that is broken, Patton said prices could fall to $1,300. Beneath that level trendline support is at $1,280.

Those would be good buying opportunities, if prices fell that far, and he expects buying to come in if a break like that occurred. 

Silver’s short-term outlook is a little more tenuous, he said.  Currently it’s holding above chart support around the $28.20 to $28 area.

“I’m more concerned about silver than I am about gold. The charts seem to suggest a topping pattern – maybe it’s a window into gold,” he said.

Patton said support for silver does not come in until around $25, a level where it broke out of resistance. That means silver could fall further if downward momentum were to pick up. Trendline support comes in at $21. “Silver is more volatile than gold and it could fall another 10% - I think it could test $25,” he said. “If it does, it would be a good buying opportunity.”

Source: http://www.kitco.com/reports/KitcoNews20110114AS_DeC_outlook.html

Is The Gold Price Rise to $1,380.70 Something to Get Excited About?

I found some work papers not long ago where back in 2002 or 2003 I was trying to decide whether gold, which had reached the atmospheric height of $340, would correct to $320 or $300. Do you all have any idea how ridiculous that $20 - $40 looks today with gold at $1,380?

Franklin Sanders, The Moneychanger
The-MoneyChanger.com

Our Comments:

Definitely the history has proven the GOLD Prices has always bullish in trend. So, why waiting? this is the right time time to buy GOLD and keep for future investment. In future $ 1,380 might be $5000 or $10,000?. We will never know.

Gold, Silver Other Metals Continue Rise On European Debt Worries- The Star Online

Published: Wednesday January 12, 2011 MYT 7:18:00 AM


NEW YORK: Gold and other metals continued a rally that began Monday as investors seemed increasingly worried that debt problems in Europe are mounting.
Metals were up across the board Tuesday. Investors appeared worried about debt auctions to be offered later in the week by Spain and Portugal, said Tom Pawlicki, commodities analyst with MF Global Research in Chicago.

Gold for February delivery rose $10.20 to settle at $1,384.30 an ounce. Silver followed, with March contracts rising 63.8 cents to settle at $29.499 an ounce. April platinum rose $25.20 to settle at $1,770.30 an ounce.Industrial metals also rose. Copper for March delivery rose 8.45 cents to settle at $4.3490 a pound. Palladium for March delivery rose $34.10 to $783.75 an ounce.

The extent of Portugal's market problems will become clearer Wednesday, when the government auctions off 3-year and 9-year bonds. Poor demand or punishingly high interest rates at the auction would deepen worries about the region's financial woes.
Analysts think Portugal will raise the money, but at a heavy price. Spain is also holding a bond auction Thursday.

Corn was flat as soybean and wheat prices fell ahead of a USDA report to be released Wednesday showing updated crop production figures.
March wheat lost 7.75 cents to settle at $7.595 a bushel. Corn for March delivery was unchanged at $6.07 a bushel. Soybeans fell 23.5 cents to $13.57 a bushel.
Energy prices rose sharply after a presidential panel investigating the Gulf oil spill said the oil industry and the government need to do more to reduce the chances of another large-scale disaster.

The panel's recommendations included increasing the liability cap for damages when companies drill offshore; increasing budgets and training for the federal agency that regulates offshore drilling and lending more weight to federal scientific opinions in decisions about drilling.
The report led to speculation that the government might slow down production in the Gulf of Mexico, which would lead to higher prices.
Benchmark oil for February delivery rose $1.86 to settle at $91.11 a barrel on the New York Mercantile Exchange.

Heating oil fell 5.27 cents to $2.6088 a gallon, gasoline rose 2.41 cents to $2.4784 a gallon.
Natural gas rose 8.7 cents to $4.476 per 1,000 cubic feet. - AP

Harga emas terus meningkat pada 2011

Gifts of gold jewellery get smaller and lighter

AS gold prices continue to soar to stratospheric heights, Asian brides are seeing their traditional wedding gifts of gold jewellery becoming lighter and smaller.

Gold outshone most commodities in 2010, setting a new record of US$1,431.25 (RM4,414.69) per ounce on Dec 7 last year.

The precious metal is expected to continue to roar ahead in the new year as both investors and the man on the street buy up gold amidst uncertainties over global economic growth, which continues to be weak.

“I have not even hedged my gold,” Datuk Seri Andrew Kam, chairman and chief executive officer of Peninsular Gold Limited, told Sunday Starin an interview.

Peninsular Gold is one of the country’s largest gold producer.

“Gold prices are being driven by uncertainties in the currencies, especially the US dollar, and the upward movement of oil prices,” said Kam.

He expects demand to remain strong, particularly from China, India and the Middle East.

Gold started on its upward trajectory around 2004 when it traded between US$260 and $300 per ounce.

Soaring gold prices have impacted a wide spectrum of Asian life – from pawnshops to wedding gifts.

Despite its high price, friends and relatives of Asian brides are still keeping up with the tradition of giving away gold jewellery.

According to Poh Kong Jewellers, one of Malaysia’s largest jewellery retail chain stores, people still spend the same amount of money but are buying smaller items.

“People are buying lighter weight items,” said Margaret Hon, Poh Kong’s head of corporate communications.

Poh Kong’s gold wafers, named Bunga Raya, have also seen brisk sales as buyers snap them up as investments.

“We sell them in weight ranging from 1g to 100g,” said Hon.

“Whenever the global currencies are weak, people turn to gold as an investment. They also see gold as quite a safe hedge against inflation,” she said. - By AMY CHEW

Thestar - 2 January 2011

Gold Prices Expected to Increase by 2011

December 28, 2010 By james

Based on the 2010 Global Gold Price Survey Report by PwC, mining firms worldwide expect gold prices to increase even with the current high gold prices.

The report indicated that most gold firms anticipate their projected levels of production to increase in 2011. Almost 75 percent gold mining firms anticipate an increase in gold prices in 2011 even as the current price level is lower than the 1980 levels. Gold companies foresee gold prices reaching $3,000 even as forty percent think gold prices will top $1,500 based on the November 2010 survey.

According to John Gravelle of PwC, with the increased demand for gold, gold firms with marginal gold stocks may increase production to meet the possible demand for gold in 2011.

Seventy percent of gold companies aim to search for new ventures or enhance the ones on hand or resupply gold stocks in anticipation of the increase in gold prices. Gravelle added that there is a link between increasing numbers of deals and increasing gold prices as more deals have been made during the year.

Problems in some currencies may have caused the current increase in gold prices as some countries have now utilized gold to replace these currencies.  Countries with gold resources have used these resources to lessen their currency value while countries without resources are also trying to reduce their currency value to help their export industry.

A number of gold firms view gold price hedging unfavorably even as 26 percent of firms lock in gold prices through forward sales contracts despite a possible increase in gold price in 2011. Around 64 percent are obliged due to financial requirements.

Gold price hedging was limited due to the increased gold prices as shown by the elimination of hedge books by a number of gold firms in 2010.

Source: http://www.planetinsane.com/gold-prices-expected-to-increase-by-2011/264696/