SWOT Analysis: Gold Bounced Back After Attempts to Knock Down Price

Strengths
The best performing precious metal for the week was silver, up 2.53 percent. It has lagged behind the other precious metals this year and speculators have raised their net long position this week. Gold bounced back positively after several attempts to knock down the price. Last Friday, over 4 million ounces of gold changed hands within minutes. Then, this past Tuesday, more than 2 million ounces changed hands, spurring a price drop. Bullish investors responded two hours later with a surge in buying to help boost prices. Lawrie Williams writes that the attempt to lower gold prices mentioned above reflects positively for those who consider gold to still be in a bull market. Ray Dalio of Bridgewater went on a gold-buying spree to increase his holdings by 575 percent and enter the gold ETF space. Perhaps buyers following Dalio’s lead are using these sell-offs to pick their entry spots. Weaknesses
The worst performing precious metal for the week was palladium, up just 0.05 percent for the week. ‘Palladium prices could plunge 90 percent by 2040 as cars become electric,’ reported ABN Amro. According to Reuters India, gold prices flipped to discount as wedding demand for the yellow metal were lower than expected. Additionally, the Federal funds futures show a possible rate increase in December at 92 percent.

This post was published at GoldSeek on 20 November 2017.


Off-Topic Sunday: Bio-Weapons And Super Robots

For some people, obsessing about The Coming Financial Crisis might actually therapeutic because it’s both understandable and easily survivable (just buy gold and silver!). So time spent researching the subject on Zero Hedge or pricing Silver Eagles online could actually be a useful distraction from the other, potentially much scarier stuff that’s going on out there.
Last week, for instance, Wired Magazine noted two developments that until, well, last week, were safely in the realm of science fiction. First, there’s a new gene manipulation technology that can apparently insert a time bomb into entire species – including us:
This gene-editing tech might be too dangerous to unleash
TO GET TO work in the morning, Omar Akbari has to pass through a minimum of six sealed doors, including an air-locked vestibule. The UC Riverside entomologist studies the world’s deadliest creature: the Aedes aegypti mosquito, whose bite transmits diseases that kill millions each year. But that’s not the reason for all the extra security. Akbari isn’t just studying mosquitoes – he’s re-engineering them with self-destruct switches. And that’s not something you want accidentally escaping into the world.
The technology Akbari is designing is something called a gene drive. Think of it as a way to supercharge evolution, forcing a genetic modification to spread through an entire population in just a few generations. Scientists see it as a powerful tool that could finally vanquish diseases like malaria, dengue, and Zika. But US defense agencies see something else: a national security issue.

This post was published at DollarCollapse on NOVEMBER 19, 2017.


Gold Versus Bitcoin: The Pro-Gold Argument Takes Shape

Sound money advocates who love the concept of cryptocurrencies but don’t want to abandon precious metals have been trying to clarify their thoughts of late. Risk Hedge just helped, with a comprehensive statement of the pro-gold position. The following is an excerpt. Read the full article here.
All the Reasons Cryptocurrencies Will Never Replace Gold as Your Financial Hedge Despite what the crypto-evangelists will tell you, digital tokens will never and can never replace gold as your financial hedge. Here are six reasons why.
#1: Cryptocurrencies Are More Similar to a Fiat Money System Than You Think.
The definition of ‘fiat money’ is a currency that is legal tender but not backed by a physical commodity.
It’s clear that cryptocurrencies partially fit the definition of fiat money. They may not be legal tender yet, but they’re also not backed by any sort of physical commodity. And while total supply is artificially constrained, that constraint is just… well, artificial.

This post was published at DollarCollapse on NOVEMBER 19, 2017.


Money and Markets Infographic Shows Silver Most Undervalued Asset

Money and Markets Infographic Shows Silver Most Undervalued Asset
– Silver remains severely under owned and under valued asset
– Entire silver market worth tiny $100 billion shown in one tiny square
– ‘All of the World’s Money and Markets in One Visualization’
– Must see ‘Money and Markets’ infographic shows relative size of key markets: silver bullion, gold bullion, cryptocurrencies/ bitcoin, largest companies, 50 richest people, Fed balance sheet, currency, stocks, property, cash, debt & derivatives
– Small allocation by investors and world’s richest will see silver surge like bitcoin
***
by Visual Capitalist
Millions, billions, and trillions…
When we talk about the giant size of Apple, the fortune of Warren Buffett, or the massive amount of global debt accumulated – all of these things sound large, but they are actually extremely different in magnitude.
That’s why visualizing things spatially can give us a better perspective on money and markets.

This post was published at Gold Core on November 20, 2017.


Asian Metals Market Update: November-20-2017

I have seen very big moves in global financial markets in ‘Thanksgiving week’. I will be cautious this week. Silver gets the best week to rise and zoom. I expect short covering with every rise in gold prices. Speculation that some hedge funds are exiting crude oil long positions is preventing the rise. A strong US economy implies more guzzle for fuel during holidays.
Crude oil is not falling due to the crisis in Saudi Arabia. There is media speculation that developments in Saudi Arabia can result in crude oil prices doubling over a period of time. Further chances of US dollar dumping by Opec is also catching investors. Bitcoin and crypto currencies are now the future means exchange. Paper currencies are now the past. Americans will control the crypto currencies in the near future but their grip will not be the same as that of the US dollar. Gold will be the only key means of exchange between central bankers and large investors.
The political crisis in Germany should also be bullish for gold. The German chancellor declaring its failure to form a government can put the Eurozone into further crisis. Currency markets will be very volatile and will be dependent (too a large extent) on the political scene in Germany.

This post was published at GoldSeek on November 20, 2017.


Gresham’s Law

This year’s Nobel prize in economics was awarded to Richard Thaler, a pioneer of behavioral economics. But there is a tale told by a lesser known Nobel laureate, Kenneth Arrow. As a World War II weather officer, he was tasked with analyzing the reliability of the army’s long-range weather forecasts. His conclusion: statistically speaking, the forecasts weren’t worth the paper they were printed on. Captain Arrow sent along his report only to be told, ‘Yes, the General is well-aware the forecasts are completely unreliable. But, he needs them for planning his military operations.’
Okay, maybe you don’t actually need a Nobel prize to know that rationality in the decision-making department is often lacking. Case in point: the capital markets. While subtle and ingenious in construction, the capital markets are, nonetheless, driven by the mass action of millions. They are a reflection of ourselves and necessarily express both the summit of our knowledge as well as the pit of our fears, and everything else in-between. And, this brings us to the subject at hand: Gresham’s Law. Sir Thomas Gresham was a financier in the time of King Henry VIII and his name is, of course, attached to the principle that ‘bad money drives out good money.’ Coin collectors of a certain age are familiar with the near immediate disappearance from circulation of all silver American coins once Congress had mandated the use of base metals beginning with the 1965 vintage. While all coins – silver and copper alike – carried identical legal tender value, it was the silver coins that vanished. Perhaps you are wondering what this has to do with bond investing? Everything!
Consider the state of financial markets as witnessed by metrics of implied volatility:

This post was published at Zero Hedge on Nov 19, 2017.


Perspective on the Gold/Oil Ratio, Macro Fundamentals and a Gold Sector Bottom

With all due caveats about the non-stellar gold CoT data (we’ll update in #474) I wanted to note a constructive situation in gold vs. oil, which is a key sector fundamental consideration. Now, there is still a constructive situation in play for nominal crude oil, so take this post for perspective more than anything.
Pardon the massive charts (click to expand) but I am going to start using these personally so that I can fully take into account the historical market aspects that go further back on a daily chart. They just don’t present as well at the website, unless clicked. So I’ll mostly use the smaller, clearer charts for public consumption.
Au/WTI bottomed in December of 2016 as the sector bottomed that same month. The first positive signal was a rise above the daily EMA 10. That is what Au/WTI did this week (until today, as it pulls back below the EMA 10, in-day). Pullbacks will happen even if this is a successful bottoming process. The relative downside volume into an oversold RSI (14) and even higher upside relative volume out of the oversold reading is interesting.

This post was published at GoldSeek on 19 November 2017.


Lithium – the new White Gold

Lithium is known as ‘white gold’ since electric cars require a lot of batteries. This has resulted in transforming the metal into a valuable and sought-after commodity. The demand keeps rising as there is a need for energy storage that can only be produced if lithium is available in sufficient quantities.
The price has soared from $1,550 to $9,100 a metric ton. This interesting metal was once used as a treatment for brain disorders. It was also the title of a song by Nirvana for its effect on the brain. Lithium is often found in salt flats when water repeatedly evaporates from a shallow lake, leaving behind a crusty layer of salt minerals. Consequently, Lithium is unique because it is the lightest known metal.

This post was published at Armstrong Economics on Nov 18, 2017.


Asian Metals Market Update: November-17-2017

Gold and silver are steady on increasing chances of the passage of the US tax cut bill. Resurgence in bitcoins and other crypto currencies is preventing investment interest in bullion. Short term hot money has moved to cryptos from bullion. The price moves in gold and silver are mainly dependent on physical demand and physical premiums in Asia.
In India I see more and more retail trading volumes in Industrial metals than gold and silver. This year’s rise in industrial metals has attracted brokers, retail traders and everyone alike. Aluminum was untouchable a few years ago and has attracted good trading volumes. Nickel’s recent breakout has also resulted more numbers of daily traders. Some of the head core silver traders have moved to industrial metals as it gives more profits than silver. A word of caution to industrial metal traders. The rise in industrial metals has been mainly on expectation that the global switch to electric vehicles can result in a long term shortage. But in my view traditional auto makers are making their vehicles more fuel efficient buy making engines from Aluminum instead of cast iron. The global switch to electric transport may not happen overnight. A sharp correction in industrial metals can happen anytime. Nickel has seen a very sharp correction over the past seven days. Other industrial metals could follow Nickel soon.
Traders will start taking positions for the first week of December from now. Geopolitical risk and political instability in the UK and some Eastern European nations can cause furor. Economic data releases from anywhere in the world will affect markets if and only if they indicate a slow down next year.

This post was published at GoldSeek on November-17-2017.


Is a December Rate Hike Necessarily Bad News for Gold?

Conventional wisdom holds that an interest rate hike in December will be bad for gold.
But will it?
There is actually evidence the opposite could be true.
Higher interest rates generally boost the dollar. This puts downward pressure on the price of gold. So, one would expect a rate hike to cause gold to tank. But over the last two years, the opposite has happened. In fact, we have seen double-digit increases in the price of gold after rate hikes.
So what gives?
The biggest factor is that we generally know the Federal Reserve is going to raise rates long before it actually acts. We’ve heard talk of a December rate hike since July. In fact, analysts say the likelihood of a quarter point December hike stands at 97%.
So, with several months to anticipate a hike, it is generally already baked into the price of gold by the time it happens. The market has been factoring it in all along. The Economic Times of India provides a succinct explanation of what has happened over the last two years.

This post was published at Schiffgold on NOVEMBER 17, 2017.