On Wednesday 28th December both Asia and London took the price up over $1,390, but only rose €2 in Europe. It then continued to rise through to New York’s opening after which it rebounded through $1,400. So much for the fall during the festive season. The Japanese Yen and the Swiss Franc showed the fall in the dollar and the euro. Gold also rose in the euro to reach €1,62 again.
Again the fundamentals have not changed, with demand coming from the entire world. As we forecast, “we expect the gold price to show more vigor.” However, we did not expect this vigor until after all the holidays were out of the way. This bodes well for the future price of gold and silver. We are certain that we will see a silver-lined, golden 2011!
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Gold – Very Short-term
The gold price is holding in the euro and we expect that it will do so today in New York.
Silver – Very Short-term
The silver price is strong and expected to remain so today in New York.
Gold Price Drivers
One looks for those signs of factors that influence the gold price, sitting just below the surface. The sign we saw this morning was the impact of Asia. At a time when most commentators expected the developed world to play safe, while on holiday and sell or stay out of the market, the gold price rose. This tells us that Asian and European demand is stronger than in the U.S. and that Europe is not prepared to see the gold price fall there. This should prove to be the case in 2011 as the gold market grows in London while Asian demand grows there.
We forecast this prior to the holiday as you know. When western demand really does return to the market it will have to take prices higher to get what it wants. With prices rising at this point in time demand is clearly strong at a time when the developed world expects a fall off in the jewelry demand.
In the next few issues of the Gold Forecaster and Silver Forecaster we will be looking at the path ahead for gold and silver. We will also publish reports on companies like Coeur d’Alene [silver and gold] and other attractive junior mining companies in the gold and silver worlds.
We recommend that you subscribe or continue to subscribe to these newsletters to be ready for the gold and silver markets in 2011.
Regards,
Julian D.W. Phillips