Gold has 2011 for $ 1500 per ounce?
Although the gold price in recent days has clearly come back from a high side of the trade mark of 1,200 U.S. dollars per ounce, but have the fundamentals behind the gold price rally not changed. Experts expect even a gold price of $ 1500 per ounce in the next 18 months.
When the latest figures on the U.S. labor market have been known to increase the U.S. dollar due to the positive surprise, immediately. And not as we might expect, that dollar exerted increased pressure on the price of gold. Then, on Friday, December 11th we went to an increase of about $ 15 with the gold price down again, after the figures for U.S. retail sales are also slightly better than expected turned out. For when the rising retail sales increase, the expectations of the U.S. Federal Reserve to raise its key rate again increases suggest the dollar and the gold price falls. In November, retail sales climbed by 1.3 percent, while the forecast was at 0.7 percent growth. Does that mean that we will peak in the gold and the low in the dollar is already behind us?
Let’s put it this way: Do you really believe that the Fed raises interest rates again at once, only on the basis of these two reports? And do you really believe that the long-term trend of U.S. dollar (down) and gold (up) in the last ten days have been reversed?
Well, in relation to the gold price no one can deny that we have witnessed an impressive growth since July. Perhaps the recent re-setter, was the short term, just a normal reaction as it occurs in every market. But if they think that the peak of the gold price we’ve seen, I’d say you’re wrong. Yes, $ 1225 per ounce, which may have been the highlight of the current rally, but the bull market in gold is far from over – and the price of gold has, in my view, still significant upside potential.
Because fundamentally, the situation has changed not a bit.
The indebtedness of the United States now exceed 12 trillion U.S. dollars and the annual deficit now stands at over 1.5 trillion dollars. I think that this massive and more debt is exploding not nearly as easy to keep a tight grip on how we Institutions and authorities would have us believe. I think that countries like China, India, Japan, Korea or Russia in the foreseeable future, no or hardly any U.S. will buy Treasury bills and thus have the Fed will have no choice than to print more money. What would devalue the dollar even further. And I believe that gold will play in the next few years a growing role as a “global currency”, since people’s confidence in the major currencies, particularly the U.S. dollar will lose more and more. And the demand will far exceed the supply of gold.
Two other factors, of which, I think that they will have a positive impact on the gold price are the emergence of China as a major player in the gold market and the attitude of central banks for gold. In addition, the gold producer in my view will continue to strengthen resolve their hedge-books, or be more careful with new hedging transactions, which in turn should make selling pressure from the markets.
Both Merrill Lynch / Bank of America and other large institutions such as Goldman Sachs, Barclays, HSBC, UBS and others believe that the dollar is fundamentally weak because the U.S. government has accumulated too much debt. In recent days, the rating agencies, the U.S. government and the British government warned that if they do nothing to curb their budget deficits in the next two years, a serious risk of a rating cut for the two countries exists. Where that leads could be seen on the example of Greece in Europe just started. The effect for the U.S. Dollar would be very, very negative. And if you think about it, it does not look like there in the next few years the possibility of reducing the deficit. Say: “The dollar should continue to fall – and rise to the gold price. BofA / Merrill Lynch predicts that gold prices will reach in the next 18 months, the mark of $ 1500.
I am of the opinion that it is developing, we are now able to observe only a further correction and consolidation. And as I have already said recently: the Re-setter, in my opinion is a way for investors to enter in gold and silver. There is no harm intended to create a certain proportion of the portfolio in physical gold or silver. If you want a stronger lever, you should think about an investment in gold mining stocks or ETFs (exchange traded funds).
More reports on www.etf-indexfonds.de
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- Analysten: Gold bei 1500 Dollar möglich
- Goldpreis schon 2011 bei 1.500 Dollar?
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