Some thoughts on the return of gold as a means of exchange from L’Or et L’Argent (the original article may be read here).

Payment for Iranian oil in gold

More than a trend, there is a strong signal being sent: gold is returning to the markets as a currency of exchange. Thus, China, the largest importer of Iranian oil, follows in the footsteps of India and avoids the embargo imposed on Iran by choosing to pay for crude oil in gold. Because it decided to continue with its nuclear program, Iran saw sanctions imposed by the United States in late 2011. The oil embargo, which will take effect in June, prohibits payment for Iranian crude oil in international exchange currencies (Dollars, Yen, Euros…). Soon after, the European Union announced that it was also going to apply the embargo which will take effect in July.

Gold returns in trading

Although Iran does not represent a large percentage of oil imports to the US and to the EU, the same cannot be said for India and China which between them account for 40% of imports. India, which has a large demand for oil, has chosen to maintain its commercial trade with Iran by paying its bills in gold.

Recently, Forbes magazine reported that China was also intending to avoid the financial sanctions imposed on Iran by buying its oil with gold. China, the largest producer but also the largest consumer of gold, already imports huge amounts of the yellow metal (its imports tripled in 2011, to 428 tons). Such a decision will only amplify the economic effects on the price of gold.

Gold: exchange currency and political weapon

Gold, which is increasingly returning to the mechanisms of means of payment will also take a more political dimension and become a real weapon of war. These events confirm the most bullish gold market for years. In the same way that investors made wise choices by betting on gold since 2007, this also goes for today’s investors, when they will see the ounce crossing the $2,000 mark in the next few months.

 Gold has recently been undergoing a consolidation period – its price is below the value that in reality it should have. It is therefore the right time to strengthen one’s positions on gold, before the summer. Moreover, because of the presidential elections in the US next November, uncertainty over the economic future of the country will undoubtedly cause a new rush on gold… which will not stay at the current level of $1,640.

Here’s a Goldcoin.org summary of events moving and shaking the markets supplied by our regular Gold Guru Bill.

In Wednesday nights website update initial resistance was listed at 1457-1465 and the high so far today is 1462.50  — support was listed at 1441-1447 and the low so far is 1450.50

London Gold Fix $1458.25 -$3.25

In yesterday’s update gold prices dropped right at the 9AM est timeframe and supported on the 1444 price support area.  Since that time, the gold market has rebounded into early Wednesday morning US trade but has yet to overcome the resistance area’s that it will need to in order to forge higher.

So far this morning, gold is tracking with equities, as the fear of slowing was at least part of the reason behind the aggressive selling in markets on Tuesday. The markets opened

The trade bounced higher on improved US retail sales release this morning, as investment demand for gold is likely to remain somewhat dependant on the prospect of inflation, which in turn can be dependant on the pace of the economy.  Business Inventories were up .5%
The key will be whether the stock market and gold will be able to hold those early gains as the day wears on.

The pressure for USA to work the budget deficit has President Obama addressing the nation this afternoon after the metals market close. Tax hikes and healthcare cuts are the speculation going into the speech –and as news trickles out  there is speculation of 100-150 billion dollar cuts in military spending proposed and entitlement spending.  Expectations are to suggest curbing domestic spending …. all the usual “talk” that one would expect.  This expectation might act to quell the upside on gold today going into the speech.

While the gold market saw evidence of rising gold production at Fresnillo in the first quarter, that news was offset by expectations of lower annual 2011 gold production from Kingsgate.

The gold market might also be garnering some lift from a survey released overnight that suggested many think central banks will be net buyers of gold in the near future. With the US Beige book, US retail sales up .04% , a Treasury auction and a Presidential speech/testimony today the gold market looks to have an active trade today.

The Dollar is near unchanged levels against most of the major currencies during overnight trading and is just sitting at the on the index.

The Spanish Prime Minister stated that China has reaffirmed their support for purchasing Spanish sovereign debt. Euro zone Industrial Production during February was up 0.4%, lower than projections. UK Unemployment during February was 7.8%, lower than forecasts. French CPI during March was up 2.2% year-on-year, higher than expectations. The second leg of the Treasury’s monthly refunding, the 10-Year Note auction, will have data announced at 1:00 PM EST

Going to the charts:

Yesterday low at 1444 was a retest of the breakout price we had been watching last week.  We can see on the chart that today’s price has moved back above that red trend line and price is hanging around that line as it tries to make it support.   So we could see a lot of price activity mostly in the 1453-1463 area today.

Support is the 1444-1450 area and resistance is the 1463-1468 zone.

In summary — markets may pullback from their early morning start and drift sideways as we approach the presidents speech on deficit reduction. As long as price is above the red trend line — its trying to forge support from yesterday’s pullback.   The lower PURPLE line is key to this price breakout and price needs to retain closes above the 1425-1430 area to keep the price  breakout move alive.

by Bill Downey

Don’t forget Exclusive Free trial to Goldcoin readers on Gold Trends.net
Login: demo-feb Password: spot2see

The most detailed info that GoldTrends.net publishes is available on the web site via paid subscription.

The interaction of the world’s markets plays an important role in the fluctuations and evolution of the Gold Price. Politics, economic policies and strategies, world events and currency changes can all have an effect on the demand for Gold as investors, private and institutional look to protect their wealth resources. At Goldcoin.org we champion the safe haven that gold and gold coin investment can offer in these troubled ecomonic circumstances where we have rising inflation, instability across the world and are on the verge of a new period of severe financial crisis.
Here’s a snapshot update from our regular expert analyst Bill Downey who explains where the gold price is, where it might be going and some of the factors that are affecting it.

In Tuesday nights website update — initial resistance in gold was listed at 1464-1468 and the high so far is 1467. Second tier resistance for today was listed at 1474-1478 — and that would be the area to watch if we can continue to move higher today.

Initial support was listed at 1444-1455 and the low so far today is 1453.60

London Gold Fix $1461.25 -$8.25

While the June gold contract saw an initial downtrend overnight, gold prices have recovered above the prior session’s closing value in the early Tuesday US trade action. Gold appears to be partially undermined by declining oil prices and a dampening of overall inflationary fears.

News that a major commodity trading brokerage firm was recommending profit taking in commodities, may also be undermining the gold market slightly. However, another key brokerage firm suggested that gold would outperform most commodities directly ahead and that might help gold prices stand up to the partial liquidation wave in some commodity prices.
Indian gold prices were slightly weaker overnight and news of another quake in Japan applied some minor pressure to gold and other commodity prices overnight. While the trade balance report from the US can drive gold prices, expectations for a slight narrowing of the US trade deficit might be seen as a negative to gold prices, especially if that report lifts the greenback and adds pressure to the bond market. If that would be the case — we think it would be temporary. The US dollar is under pressure again today and the Euro has now traded at the 145 level — a very IMPORTANT price point.

While the gold market generally saw dovish comments from the Fed yesterday, dialogue from the Fed’s Hoenig today might be add to the downside tilt as they are trying to “TALK” their way into making the markets think that there is not going to be more stimulus. So that is the one thing that could return gold to testing the lower areas from last night.

Equity markets in Asia and Europe were weaker during overnight trading and early indications are for the US stock market to open today’s session with moderate losses as Alcoa reported lower than expected earnings and Japan raised the danger level of its on-going crisis. The Japanese Economics Minister said that last month’s earthquake and tsunami would likely have a larger negative impact on the Japanese economy than earlier projections. A proposal by the African Union to end the Libyan conflict was rejected by rebel forces. The German CPI during March was up 2.1% year-on-year, in line with forecasts. A survey of German economic sentiment during April was 7.1, lower than estimates. The UK CPI during March was 4.0% year-on-year, lower than projections. The UK Trade during February was 6.78 billion Pounds, a smaller deficit than forecasts. Major US economic numbers to be released this morning include the February International Trade Balance, as well as Export and Import Prices at 7:30 AM, and surveys of store sales will also be released during the session. In addition, Fed Regional President Dudley will give a speech during the session. The first leg of the Treasury’s monthly refunding, the 3-Year Note auction, will have results announced at 12:00 PM CENTRAL time.

Going to the gold charts:

Last nights low was right at the dotted trend line on 30 min chart we published on the website and as long as the 1444-1455 area holds the trend remains up. The market is NOT AS BULLISH as it looked when we entered the week — and even though gold has come back 13 dollars from the low — we’re not out of the woods just yet on this pullback. The 1468-1470 area is probably the most important price point to watch today. We want to see gold above 1468 on a closing basis to add more potential that the pullback is complete. Until then — we can’t rule out more downside pressure today.

It seems like the 9am-10:30AM EST period today might be where the rubber meets the road — and that time frame is when gold would be the most likely to try and pullback.

In summary — the trend is still up —but not as solid as last week– the 1468-1470 area is resistance. Support is the 1444-1455 area. We still favor the bulls —- but we might remain in the 1450-1470 area today in price.

by Bill Downey

Don’t forget Exclusive Free trial to Goldcoin readers on Gold Trends.net
Login: demo-feb Password: spot2see

The most detailed info that GoldTrends.net publishes is available on the web site via paid subscription.

People often ask if it is the right time to buy gold?

Quite simply it is always the right time to buy gold if you are looking to protect and preserve your wealth.

Sure the price can vary but the real value in owning physical gold is that it is your outright property which cannot be wiped out during a crisis or financial collapse. So think of a stocks and shares investment (or any other “paper” investment) the day after a crash – now think of physical, tangible gold assets that you own the day after a crash. The difference is obvious – one is worthless and may even lead to debt, the other has inherent value that will still be sought and can therefore be traded or sold.

Buying gold nowadays is simple and accessible to everyone.

You do not need to physically possess gold at home to fully participate, indeed quite the contrary – keep it safe, keep it in a vault and keep it accessible to sell whenever you choose.

For further information click here.

Here at Goldcoin.org we regulalrly feature expert Analysis from Bill Downey of Goldtrends.net to keep readers up to date with possible moves in the market.

Bill’s comments are drawn from a wide variety of sources and provide an up to date overview of the evolution of the gold price.

Here what Bill is saying:

In Sunday nights website update — resistance for today was listed at 1483-1490 and the high so far is 1476.50 — support was listed at 1458-1463 and the low so far is 1464.50

London Gold Fix $1469.50 -$1.00

Late Sunday night in the US and early in the Asian Monday trade saw commodities on the rise. However, news of a possible Peace deal in Libya and another 7.1 earthquake in Japan seemed to prompt a pause in oil price upside and in other commodity markets.

News of ongoing inflows into gold derivatives at the end of last week is lending to gold support so its generally a sideways choppy action we are undergoing this morning. The reversal in oil prices seemed to shift the attitude in a number of commodity markets this morning to a more sideways movement. With the big rise last Friday in commodities, it looks to be profit taking at the moment and not a start of a downtrend.

The Bretton Woods meeting hosted by George Soro’s over the weekend has calls for the US dollar replacement — but that was to be expected. The G20 meets in Washington DC on the 15th of the month and it would be interesting to hear the conversations that will take place there. With that meeting coming up at the end of the week — it is possible that gold may stay have some restraint later in the week, but the overall short term trend is still up.

The US Dollar is slightly bouncing this morning back to the 75 level but remains at key levels on the long term charts.

The Commitments of Traders Futures and Options report as of April 5th for Gold showed Non-Commercial traders were net long 230,758 contracts, an increase of 16,775 contracts. The Commercial traders were net short 287,091 contracts, an increase of 23,006 contracts. The Non-reportable traders were net long 56,332 contracts, an increase of 6,229 contracts. Non-Commercial and Non-reportable combined traders held a net long position of 287,090 contracts. This represents an increase of 23,004 contracts in the net long position held by these traders.

A 7.1 magnitude earthquake hit near the Tokyo area today, causing water pumping at the Fukushima plant to be shut down for 50 minutes. Major banks in the UK were told to raise their capital levels and separate their retail operations from investment banking activities. Chinese Exports during March were up 35.8% year-on-year, while Chinese Imports during March were up 27.3% year-on-year, both of which were above market expectations.

Going to the gold chart — the breakout from a five month trading range last week is in play and while there is consolidation today from last Friday’s upmove — it does not look like a downtrend is beginning at the moment.

A new red line on the chart shows the short term FIRST support for this weeks action near the 1455 area on a closing basis. Additional support would be the 1444-1450 area on intra day pullbacks. THus the two key areas are the red trend line —and the lower purple line on the up channel. As long as price is above those price areas — the trend remains up. Resistance is the upper purple line near the 1490 – 1492 area.

In summary, todays consolidation in the 1460 area is normal after a nice upmove from last Friday and the bulls still have the short term advantage. First support will be the Red trend line — and resistance for the remainder of today looks to be in the 1473-1478 area. A pullback in the 1445-1455 area this week might provide an area for finding initial support. The bulls still have the advantage at the moment and the action does not at this point indicate that the trend has turned down — but rather is consolidating in the 1460 zone.

by Bill Downey

Don’t forget Exclusive Free trial to Goldcoin readers on Gold Trends.net
Login: demo-feb Password: spot2see

The most detailed info that GoldTrends.net publishes is available on the web site via paid subscription.

People often ask if it is the right time to buy gold?

Quite simply it is always the right time to buy gold if you are looking to protect and preserve your wealth.

Sure the price can vary but the real value in owning physical gold is that it is your outright property which cannot be wiped out during a crisis or financial collapse. So think of a stocks and shares investment (or any other “paper” investment) the day after a crash – now think of physical, tangible gold assets that you own the day after a crash. The difference is obvious – one is worthless and may even lead to debt, the other has inherent value that will still be sought and can therefore be traded or sold.

Buying gold nowadays is simple and accessible to everyone.

You do not need to physically possess gold at home to fully participate, indeed quite the contrary – keep it safe, keep it in a vault and keep it accessible to sell whenever you choose.

For further information click here.

The Trend for Gold continues upward and the Dollar is falling again – so says Bill Downey of GoldTrends.net, our regular expert Analyst. Her’s the latest from Bill for April 8th:
In last nights website update initial resistance was listed at 1462-1468 and the high so far is 1473. Support was listed at 1443-1449 and the low so far is 1466.

London Gold Fix $1470.50 +$14.00

The June gold contract in the early Friday action has moved to fresh new all time highs. In addition to ongoing concern of a US government shutdown, the gold market also saw a sharp range down extension in the Dollar overnight and therefore the bulls have a lot of fundamental arguments for the upside. In addition to the potential failure to reach a budget deal, the gold market might also be rising off the fact that the US budget cuts are minimal in the grand scheme of the multi-trillion dollar US budget! In other words, leaving US government spending high and the deficit growing is seen as an inflationary development, and as a development that weakens the Dollar and lastly increases the move to quality sentiment in the gold market off the rising prospect of a US credit rating downgrade. Those same ratings agencies that were grilled by Congress over their slack pre-sub prime ratings efforts, should probably slap US debt with a downgrade once the puny US spending cuts are put in perspective.

While the gold market could have been held back by news of a rise in Gold Fields quarterly gold production for their 1st quarter, that potential production gain actually follows a decline in gold production from that company in the previous quarter. Nonetheless, the gold market hasn’t paid that much attention to the supply side of the equation recently.

With some budget negotiators calling for a mid morning deadline on a deal this morning, there could be two volatility events today, one this morning and another into the afternoon closes in the event that no deal is reached.

The Dollar has GAPPED lower against most of the major currencies during overnight trading as the credibility is fast eroding and the break at the price chart is causing selling and shorting. Problems in Libya and Nigeria as well as escalations in Syria and the middle east continue to add pressure on oil prices as well.

In summary — the metals continue higher as the gold breakout of a five month pattern is suggesting the move will continue higher. We may see some traders taking some profits off the table as we go into the weekend —and that could keep prices range bound going into 11:30AM est as London comes up on the close — but there seems to be buyers in the mid 1460’s.

Support for the remainder of the day is the 1457-1464 and resistance is the 1475-1480 area.

Going to the gold chart, the consolidation over the past few days has held the initial breakout and the upside continues to be favored. The next upside target is the upper purple line near the 1500 area. Pullbacks today should be limited to the mid 1460’s. As long as price is within the purple channel lines — the trend remains up.

If the US government come to terms later today — it could produce some volitility — but the bottom line is that none of the problems are going away — deal or no deal.

A CLOSE ABOVE 1466 is an important number today to set the pace for next week. The trend remains up.

by Bill Downey

Don’t forget Exclusive Free trial to Goldcoin readers on Gold Trends.net
Login: demo-feb Password: spot2see

The most detailed info that GoldTrends.net publishes is available on the web site via paid subscription.

In last nights website update resistance was listed at 1437.50-1446 and the high so far is 1439. Support was listed at 1419-1425 and the low so far is 1430.

London Gold Fix $1434.50 +$2.00

There is a lot of cross current news this morning moving gold.

Gold prices were showing some positive action initially overnight despite minor strength in the Dollar versus the Euro and a few others. The gold market got marginal support from suggestions from the US Fed Chairman Monday night who labeled inflationary pressures as transitory, as that seemed to suggest that the Fed chief was a little less confident that inflation would indeed remain in check. In other words, the trade seemed to take the Fed comments overnight as a sign that inflation pressures were being acknowledged but were not fully entrenched yet. However, the Fed Chairman also suggested that recent price gains were probably temporary and that left the gold market somewhat confused. Indeed — he looked nervous during the discussion.

The gold market garnered some support from news of a credit downgrade of Portugal overnight, especially since the ratings suggested that the status of that debt remained under review.

Gold traded in the 1434 to 1439 area up until the London open. However, outside market action have limited gold prices early in the trade today, as some commodity markets like corn corn and soybeans started out on a softer footing–at least initially.

The gold market was also undermined by news of further Chinese tightening action overnight. The Chinese moved 25 basis points on lending and deposit rates and that event probably increased overhead resistance in the US gold market this morning near the 1440 area. Still — the last few rate increases from China had almost no effect — pretty much about what we’ve seen so far today. Over the last four hours — gold has tried to break below the 1430 area. Each hour has

The gold market will also be watching the GOP budget proposal release later this morning, as aggressive deficit reduction efforts could also be seen as a limiting development for gold prices. Paul Ryan has rolled out the plan and the big number is 6.2 TRILLION DEFICT REDUCTION OVER 10 YEARS —– The proposal was just released — so it will take a few days to see how the market absorbs this and how the debate unfolds.

Meanwhile the US BUDGET DEFICIT CEILING runs out FRIDAY — and the politicians are going back and forth in threats to not extend the ceiling on the Republican side.

While equity markets in Asia were mixed during overnight trading, stock indices in Europe are generally lower this morning. The Dollar was slightly higher against most of the major currencies during overnight trading, although posting a substantial loss versus the Pound.

A credit ratings downgrade of the sovereign debt of Portugal by one level this morning. Euro zone Retail Sales during February were down 0.1%, lower than expected. Major US economic numbers released this morning include a survey of US non-Manufacturing industries grew less than expected, but it wasn’t a barn burner.

GOING TO THE GOLD CHART — today we show the daily chart and the short term cycles we follow on the website. Orange circles are when the stronger trends usually peak — and the blue circles are when the weaker trend usually ends. While not all points work — take February for example — there is enough to at least keep an eye on developments. The trend is still up —- watch 1439-1444 as a key area.

On the downside — there has been a test every hour since 7AM EST of the 1430 area but so far it is holding— and that puts SUPPORT for the remainder of the day at 1425-1430. As long as price is above that area — its still up.

In summary —- the trend remains up —-We think that 1439-1444 is the PIVOT PRICE AREA TO WATCH — and closes above 1444 would increase the potential for the upside. PRICE ALWAYS RULES — but these short term trends need to be watched going into Wednesday. AS LONG AS PRICE HOLDS 1425-1430 support today — continue to favor higher.

by Bill Downey

Don’t forget Exclusive Free trial to Goldcoin readers on Gold Trends.net
Login: demo-feb Password: spot2see

The most detailed info that GoldTrends.net publishes is available on the web site via paid subscription.

In last nights update resistance in gold was listed at 1437.50-1446 and the high so far is 1439. Support for today was listed at 1419-1425 and the low so far is 1427.60

London Gold Fix $1432.50 +$1.50 LME

While the Dollar is slightly higher early, the Greenback remains within striking distance of last week’s lows. With the gold market overnight seeing a rather hot ECB inflation reading and seeing crude oil prices claw out another fresh new high for the move and a host of commodity prices trading higher, the gold bulls feel somewhat confident to start the new trading week.

Some players in the market expect some dovish comments from the Fed’s Bernanke today and after dovish dialogue from the Fed’s Dudley at the end of last week, the threat of rising US rates may become an issue but so far — it seems to be just talk. There is a G20 meeting mid-month so that’s something we’ll have to keep in mind.

Some players think that news of a release of RAD into the ocean in Japan is a limiting issue for gold, but one could also suggest that development could ultimately be inflationary if Japan is forced to seek alternative protein in the grain and livestock markets.

The Commitments of Traders Futures and Options report as of March 29th for Gold showed Non-Commercial traders were net long 213,983 contracts, an increase of 3,448 contracts. The Commercial traders were net short 264,085 contracts, an increase of 1,242 contracts. The Non-reportable traders were net long 50,103 contracts, a decrease of 2,205 contracts. Non-Commercial and Non-reportable combined traders held a net long position of 264,086 contracts. This represents an increase of 1,243 contracts in the net long position held by these traders.

While equity markets in Asia and Europe were mixed during overnight trading, early indications are for the US stock market to open today’s session with moderate gains.

The Bank of Japan’s Tankan survey of Japanese manufacturers projects that business conditions in Japan will worsen during the next three months as a consequence of the Sendai earthquake.

A Libyan envoy has traveled to Greece to begin discussing an end to hostilities in that nation. The US State Department is flying their employees out of Syria due to continued unrest.

Euro zone PPI during February was up 6.6% year-on-year, in line with market forecasts.

Going to the charts ……………..

On Friday’s update we discussed the tendency for gold to move higher after the USA unemployment data and after hitting a low of 1412, gold rallied back to the 1430 area for the close.

Coming into today and the 1439 high — it really comes down to whether gold is going to burst through the 1444 area this week. A WEEKLY Friday close above 1436 — and 1444 is needed to add to the upside potential. Although the trend is still up — the stronger trends we watch are due to peak here between today and Wednesday and a weaker trend is scheduled to begin and last into mid-month. Price always rules — and turn points are secondary — so we would want to see price begin to react and show weakness before we consider that the weaker trend has kicked in. But it’s something we need to be aware of should gold begin to trade lower. First Targets for this coming week to watch for is the 1440 to 1453 area. I’m looking to sell 1/2 my long short term gold positions from 1406 and 1418 should we trade up to the 1450 area.

The chart shows two red arrows —- the lower arrow shows the Feb lows how the market pulled back to 1325 on four occaisions in one week but was not able to break lower. The same condition happened last week — where there were four pullbacks to the 1410-1412 area — all of which produced a nice bounce back up. The lows were right on the lower purple channel line on the chart. This kind of action usually favors higher prices.

Thus, from a swing trade standpoint — as long as we remain above the 1408-1410 price area on a closing basis — the trend is still up.

Resistance is the 1439-1447 area today and first support is the 1427-1432 area.

In summary — the gold market trend is still up. A daily close above 1436 and/or 1444 would be helpful and favor higher prices into Tuesday/Wednesday. Going forward —- as we mentioned — the potential for gold to peak this week and begin a sideways to lower trend into mid month is a consideration when we look at short term cycles. However the seasonals do favor higher overall into the month of May so an April pullback — should still garner higher prices into month end and early May should we get a pullback. The trend is still up.

by Bill Downey

Don’t forget Exclusive Free trial to Goldcoin readers on Gold Trends.net
Login: demo-feb Password: spot2see

The most detailed info that GoldTrends.net publishes is available on the web site via paid subscription.

Last nights website update listed resistance at 1437-1446 and the high so far is 1436.50 — support was listed at 1419-1425 and the low so far is 1413.

The big factor supporting gold recently has been inflationary expectations, which were given a boost yesterday by strong rallies in grains and livestock as well as ongoing strength in crude oil. Comments yesterday from the Wal-mart CEO that consumers face “serious inflation” seemed to be laying the groundwork for higher retail prices ahead.

With a new month — and a new Quarter — the Media is really spinning the data of a US economic recovery as the new hires came in at a plus 212K this morning. The spin of course is that the feds are going to be able to stop printing and supporting the economy……….and to carry it further, they will also begin to talk tough on how they are going to curb inflation — when in fact they are the reason for inflation. Media is spinning that the stock market had its best quarterly gain in 13 years, and manufacturing is having a great year and the unemployment rate is going down. This spin of course is to lead the market to one conclusion — that the feds could increase interest rates…………….to which we say………….. not at the moment.

Underneath it all —- the US Dollar — has rallied very strong against the yen again this week in what must be considered intervention. But it has been enough to rescue the dollar from its precarious position on the charts.

The news has produced a hard sell off in the metals so far this morning. One item we discussed last night was that the short term stronger cycles were due to peak between today and this coming Wednesday. But since the Metals usually exhibit strength at the beginning of a new month — the key now will be to see if Gold can stabilze here and regain it’s composure going into today’s close. This has also often occured on these report days for the metals so it is not out of the question for gold to bounce back as the day wears on — and is another factor we discussed in last night’s update.

Going to the chart — we can see that today’s sell off was once again a 4th TEST of the 1410-1412 area and another hit on the lower purple channel line.

Perhaps more important is the failure for gold to have closed above the 1436 area we’ve been watching for. This remains an important price point. Support is the 1410-1415 area for the remainder of the day —-and resistance is the 1423-1429 area and then 1436.

In summary — a bounce back from the lows is underway — and if gold can remain firm and push up into the close it will keep the trend up. Any close below the lower purple line will put the upside in question.

From a historical standpoint — short term trends are due to peak in the first week of April — and last into mid month. Closes below the lower purple channel line will add to that potential. We’ll pick it back up next week. Lets see if gold can push back up as we move into the close. As long as we remain above the purple channel line — the trend is still up.
What we want to see now — is a strong finish for the metals.

by Bill Downey

Don’t forget Exclusive Free trial to Goldcoin readers on Gold Trends.net
Login: demo-feb Password: spot2see

The most detailed info that GoldTrends.net publishes is available on the web site via paid subscription.

In last nights update resistance was listed at 1427-1434 and the high so far is 1439. Support was listed at 1409-1417 and the low so far today is 1420.20

London Gold Fix $1431.00 +$12.00

With the US Dollar down this morning and oil up sharply, commodities have gotten a lift but the gold market also rose off the World Gold Council’s 2010 Indian gold consumption peg of 963 tons, and of a longer term demand forecast for India from the World Gold Council that pegged demand to reach 1,200 tons by 2020.

While the gold market has benefited from talk of favorable Indian wedding demand, evidence of a huge wheat crop and a very large sugar crop, coupled with extremely high historical prices for those crops, probably increases the purchasing power of a noted portion of the agrarian population in India. With the World Gold council also suggesting that Indian demand for gold will rise 3% annually for the next 10 years on the idea of strong Indian gold demand.

Iit is also possible that gold prices will took direction from a USDA grain report, which suggested bullish prices for Corn and Soybeans.

A report out at 11:30 pm est today on Ireland banking is being awaited by the markets.

The Feds had to release data on who received all the discount window lending. Over 900 pages have been released. This should be ripe discussions over the next few days.

Going to the gold chart — yesterday’s price pullback finally touched the lower purple trendline and for the third time this week — the lows were established near the 1410 area. Prices remained firm all night setting their lows in Asian trade and price has been rising in quick bursts with stair step consolidations since the London session. Resistance for the remainder of the day is the 1440-1444 area and support is the 1427-1430 area.

In summary — the trend remains up — a close above 1444 would increase potential of higher prices into early next week. A close above 1436 would also keep things positive going into Friday.

by Bill Downey

Don’t forget Exclusive Free trial to Goldcoin readers on Gold Trends.net
Login: demo-feb Password: spot2see

The most detailed info that GoldTrends.net publishes is available on the web site via paid subscription.

In last nights update resistance was listed at 1422-1428 and the high so far today is 1430. Support was listed at 1406-1413 and the low so far today is 1414.30

London Gold Fix $1419.00 +$5.00 LME

The gold market dipped last night to daily support at 1414 on forecasts from Gold Fields Mineral Services predictions of increased gold production in 2010 but the gold trade hasn’t been overly focused on the supply side of the equation. In fact, the gold trade generally thinks that investment and demand are easily poised to outdistance increases in supply. Gold Fields Mineral Services pegged world gold production in 2010 to have increased by 3%, with China contributing a gain of 6% and Australia contributing a somewhat shocking expansion of 16%.

While today’s gold upmove began shortly before he payroll reports, there is still a bit of caution of upcoming Fed dialogue, which this week has clearly tended toward a hawkish bias. For now, it sounds more like talk than action. Some traders are suggesting that the knock on impact of the Japanese disaster has already tempered prices and will in turn slow upcoming numbers throughout the world and that Fed tightening expectations are premature. With 3 US Fed members scheduled to speak during the trade again today and with unemployment reports due tomorrow, it is possible that metal prices will remain in the 1420-1430 area for the remainder of the day.

Monthly Japanese auto production readings showed a decline of 5.5% last night. Overnight the wires from North Africa suggested that the Libyan forces regained ground against the rebels.

Going to today’s chart — today’s push to 1430 has at least put us back above the 1420’s and currently trading near the 1425 area. End of month and beginning of month usually favors the upside in the metals so the upside is still favored into next week. The next big event will probably be the unemployment data on Friday. The potential for gold to remain in the 1420-1430 area until then has potential. Resistance for the remainder of today is the 1430-1435 area. support is 1419-1422. The next key area’s to wach would be a close above 1436 and 1444 as this would be suggestive that the upside still has the advantage. Trends are favored higher into next week.

by Bill Downey

Don’t forget Exclusive Free trial to Goldcoin readers on Gold Trends.net
Login: demo-feb Password: spot2see

The most detailed info that GoldTrends.net publishes is available on the web site via paid subscription.

In last nights website update resistance was listed at 1426-1434 and the high so far today is 1422. Support was listed at 1406-1413 and the low is 1410.90

London Gold Fix $1414.00 -$6.00 LME

Gold prices appear to have come in from over seas action on a slightly weaker footing. Apparently prices for gold related items in Japan continued to slide overnight and that could be the uncertainty of the Japan crisis.

Indian gold prices were also softer in the wake of weakness in a host of commodity prices in the US on Monday. Some gold players probably saw the hawkish dialogue from US Fed members speaking in Prague this morning as a negative, while others might have noted some residual concern within the Fed for the “Four” uncertainties facing the market. The Fed’s Bullard suggested that macroeconomic uncertainty was on the rise over the last few weeks because of Japan, the Middle East, the Euro zone debt crisis and also because of the US fiscal situation.

Last week, the gold market seemed to draw support from evidence of weak US economic readings, as that fostered some talk of an extension of easy money policies. While somewhat hawkish dialogue from the Fed over the last 24 hours might temper the impact of weak US data on gold prices, the trade should still take a long look at the reaction in gold prices to the Consumer Confidence report and the Case-Shiller home price survey this morning as both of those reports are expected to be soft.

The Dollar is higher against most of the major currencies during overnight trading. A Regional Fed President said that the US Fed may start to normalize policy before global uncertainties are totally resolved. Western and Middle Eastern nations will meet in London today to plan for a post-Gaddafi Libya. Japanese officials have found traces of plutonium around the damaged Fukushima nuclear power plant.

From a chart perspective — the inability of gold to close above 1444 last week continues to exert pressure on prices again this morning. Last nights high at 1422 kept gold inside the trading range we’ve been in for the past five months. Today’s lows have retraced back down to yesterday’s price range near 1410. This adds additional pressure on yesterday’s reversal back up. Support is the 1405-1410 (purple line) area and 1390-1398 where the dotted trend lines are.

Price needs to close back above the 1425 level as a minium to reverse the pullback that began last Thursday. The 9am to 10:30am EST timeframe needs to be watched carefully today.

by Bill Downey

Don’t forget Exclusive Free trial to Goldcoin readers on Gold Trends.net
Login: demo-feb Password: spot2see

The most detailed info that GoldTrends.net publishes is available on the web site via paid subscription.

In last nights website update support in gold was listed at 1418-1423 and 2nd tier support was listed at 1406-1412 and low so far is 1410.

London Gold Fix $1420.00 -$14.00

There are a number of cross currents going on in gold this morning. We’ve been looking for a pullback into today due to options expiration in gold — and the rollover from April gold into the June contract. Both of these factors seem to have played out as gold and silver are lower. Another factor we’ve been watching is the US dollar and the key uptrend line that is hovering at. Over the past three days the dollar has been able to climb back above 76 – and that area needs to be watched.

Gains in the Dollar overnight has added to the bears the initial edge this morning. One of the “stories” being floated is that Kadaffi will have to sell some of his gold to support his effort. We think the story has no legs — but it does add to the “spin” that the desperate shorts seem to be trying to expouse.

While the gold market hasn’t paid that much attention to supply side developments lately, news of higher Russian gold production for the first two months of 2011 has contributed to the slightly weaker price bias early this morning. The Russians saw their two month gold production rise by almost 14% over the prior year and that combined with concerns of slower global growth ahead has added to some pressure as well.

The Japanese situation continues to escalate and potentially drag on long enough that the trade is wondering if a slowing impact in industries besides automobile manufacturing could develop. Some players feel that the gold market is under pressure because of recent hawkish comments from the US Fed and also because of some market predictions that US QE2 is still set to end in June. News of a shift in political power within Germany (one of the few stalwart economic zones) adds to the uncertainty in Europe. All combined — the gold market has pulled back into Monday morning.

Support for the remainder of the day is the 1406-1410 area and resistance is the 1422-1426. In gold, I’m long 1/2 a position at 1406 — and added at 1418 last night for an average 1412. I’m using a stop at 1398 for the moment. From a chart perspective — the lower purple channel line is support — and so far gold has not reached that low point and the lower dotted trend line does not come into play until the 1385-1390 area. We’ll have to see how the price pattern looks — as our thinking is that options expiration and the roll into the June contract is what has temporarily brought gold down to this level on Monday.

The key now is for gold to get back above the 1425 area.

What we really want to see is a close above 1444 to give more confidence that gold is ending its trading range and is ready to move higher. The end of the month usually favors higher price into the first week of the month and we’re still looking for that at the moment. A short term peak will be due to begin sometime in the first 7 days of April — so we’ll be keeping an eye on that as well.

In summary — we’d like to see the lows develop here on Monday and push higher into the latter portion of the week.

by Bill Downey

Don’t forget Exclusive Free trial to Goldcoin readers on Gold Trends.net
Login: demo-feb Password: spot2see

The most detailed info that GoldTrends.net publishes is available on the web site via paid subscription.

In last nights website update resistance was listed at 1438-1445 and the high so far today is 1438. Support was listed at 1418-1423 and the low so far is 1430.50

London Gold Fix $1434.00 -$8.25

In the early action today, April gold prices are sitting roughly $10-12 below the Thursday highs. A large portion of the corrective action was seen at the end of the prior trading session and prices this morning are trading in the mid to upper 1430’s. A margin rate increase in silver was probably the catalyst for the sell off on yesterday….. but it was certainly coincidental that we mentioned if a sell off into options expiration on Monday for Gold was in play that Thursday would be the most likely day.

Many gold players continue to think that the Euro zone crisis will provide support to gold prices going forward, as the fear of contagion or knock on influences have returned to the forefront.
Others in the trade noted that gold was able to gain in the face of weak US economic readings and that is considered a change of pace from the pattern that was seen in the beginning of March. In other words, some traders think that a series of weak US data points are capable of extending US QE and that in turn might give rise to a future inflation problem.

The Dollar is holding against most of the major currencies but is still fighting to get back above 76 and still remains in trouble on the charts as we close out the week.

Japanese authorities have suggested that one of the Fukushima reactors was leaking due to a broken core has increased an already dangerous condition.

Syria protests have been escalating as demonstrations are being driven by political demands. Economic issues and inflation concerns are behind the unrest. There are scheduled protests in UK also this weekend.

In today’s gold action, price is in a trading range and is very choppy. With the weekend approaching, yesterday’s downdraft, options expiration on Monday, the middle east and Japan situation, and traders moving from the April contract into June–it has created a lot of cross currents in today’s trade. Support for the remainder of the day is the 1420-1425 area and resistance is the 1438-1444 area. A close above this area would tend to favor the upside going into next week.

I cut my short term position in gold in half last night so as to lighten up for the weekend. Should there be a pullback into options expiration on Monday — I’ll look at adding it back in the 1415-1420 area or at the lower purple trend line on the chart.

In summary — yesterday’s pullback seems more manipulative action — and price should remaining choppy and range bound for the remainder of the day. The charts and the trends still look up into the first week of April. If there is a pullback early next week we’ll look at the price patterns and see if there is a good setup.

by Bill Downey

Don’t forget Exclusive Free trial to Goldcoin readers on Gold Trends.net
Login: demo-feb Password: spot2see

The most detailed info that GoldTrends.net publishes is available on the web site via paid subscription.

In last nights website update resistance was listed at 1434-1444 and the high so far today is 1434.50 —- support was listed at 1419-1424 and the low so far today is 1425.50 —

London Gold Fix $1433.00

In the early action today, April gold has managed a rise above the prior session’s high but has reached the key 1435-1444 price area of resistance this week. This is the key area to watch this week. A close above 1435 would add to the bulllish potential towards 1460.

Reports that the Japanese disaster might end up costing as much as $300 billion. However, the upward track in gold and other commodity prices might be held back because of fears that containment of the #3 reactor at Fukushima has seen a setback overnight as commodities generally don’t like to see developments that could end up slowing the economy.

Talk that a Chinese gold company might be looking to acquire gold mines in other countries was viewed as favorable in today’s trade.

The Fed’s Fisher is a scheduled to speak today and yesterday he generally sounded a hawkish tone. The US Fed Chairman BERNANKE is also scheduled to speak just ahead of mid session today and some traders think he will largely countervail the dialogue from Fisher.

Gold will garner some support from a bullish price forecast from a gold company executive, who suggested that gold might have a “couple” more years of upside action before a top is formed.

While equity markets in Asia were mixed during overnight trading, stock indices in Europe are generally weaker this morning and the US stock market is a bit lower this morning. Home sales plummeted in USA — down 175 from January.

The Dollar is stronger against most of the major currencies during overnight trading, although posting a loss against the Yen. With the US dollar on the brink of NEW LOWS for the year and at a key chart point, we couldn’t help noticing that Portugal is in the NEWS headlines and the “spin” is that Portugal may be the third country that will ask for a Euro bailout. This has caused a Euro pullback and a BID for the US Dollar today. Coincidence ? Who knows anymore, but the US Dollar is higher in trading today. The Prime Misister of Greece also stated that any restructuring of Greek debt would bring on collapse of banks in his country.

Coalition air strikes have grounded the Libyan air force, but rebel forces have been unable to take advantage as fighting has reached a stalemate.

Going to the chart – Gold is up against key resistance today at the 1435 area — and this is probably the most important area for this week. A close above 1435 will favor higher towards 1444. Gold has attempted to move above this 1435-1445 area since Feb 28th so it is approaching decision time. The price pattern continues to show “capping” as Darth likes to call it —- but they can only hold it for so long and it looks like a decision point is coming in on the short term today or tomorrow. The upside still has the advantage but keep in mind that BERNANKE is scheduled to speak today and that can cause some choppy action.

Resistance for the remainder of the day is 1435-1444 and support is 1422-1426. The trend remains up.

In summary — but gold and silver are at key price points —and a close above these levels will keep the favored short term uptrend in place.

by Bill Downey

Don’t forget Exclusive Free trial to Goldcoin readers on Gold Trends.net
Login: demo-feb Password: spot2see

The most detailed info that GoldTrends.net publishes is available on the web site via paid subscription.

Last nights website update listed 1434-1444 as resistance and the high so far is 1432. Support was listed at 1417-1421 and the low so far is 1420.

London Gold Fix $1425.50 -$2.25 LME

Overnight trading does not seem to have undermined gold prices on Tuesday.
In fact, certain Asian equity prices have returned to pre-quake levels and that in turn has tamped down deflationary concerns and might be under pinning support to gold prices. The Dollar is a touch weaker this morning on ideas that the US is set to remain in an easing posture.

Trade “risk on” has a bit of support as news that a Spanish debt auction saw good demand overnight and that the EU managed to step up their financial bailout capacity again.

News that Gold Fields is in the market for some Peru holdings, suggests that the gold mining industry remains bullish toward gold price prospects and that angle was given some addition credence overnight by predictions from the Anglogold Ashanti CEO who predicted that gold prices could reach $1,600 in the coming months.

While equity markets in Asia and Europe were generally higher this morning, early indications in the US stock market shows a much more toned down market at the open. Traders are looking at the 1300-1304 area as a pivot point. Traders are trying to short near that area —– but a move above 1306 —would have them looking to the long side.

The Dollar is slightly weaker against most of the major currencies during overnight trading, although posting a small gain against the Yen. Although air strikes have continued for a third day, Libyan forces allied with Muammar Gaddafi continue to seek out rebel strongholds.

Steam has been rising from two of the stricken nuclear reactors at the Fukushima power plant, indicating a greater likelihood that fallout may spread beyond the complex again.

From a chart perspective — gold reached daily resistance and has pulled back to the 1420 area to fill the Monday gap. Today’s zoom in shows the 1417-1420 area as support —-and additional at 1408-1412. Resistance is the key 1432-1436 area — and a close above 1436 would be suggestive towards 1460.

In summary — the gold market remains in a short term uptrend and higher prices are favored. A close above 1436 would indicate higher towards 1460.

by Bill Downey

Don’t forget Exclusive Free trial to Goldcoin readers on Gold Trends.net
Login: demo-feb Password: spot2see

The most detailed info that GoldTrends.net publishes is available on the web site via paid subscription.