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Gold is up more than $17 this morning to around $943
July 1, 2008
Gold is up more than $17 this morning to around $943.
- The 1 percent increase in gold this morning can be attributed to both further weakness in the dollar and more near record highs in oil.
- The metal is also seeing increased support as a safe haven investment during these uncertain economic times. Coming off their worst June since the 1930s, the financial markets are just too volatile right now for many investors to feel confident. The financial markets are not over-sold, it is that there just are not any buyers right now.
- Despite what many analysts say, oil is reaching highs due to supply and demand fundamentals, not speculation. Today is no different, as a report released by International Energy Agency said supplies may not keep up with demand through 2013, and that's a long-term foreshadowing that this commodities market sector will likely rise in price over the coming years.
- All eyes will be on the ECB on Thursday looking to see what the board will do with interest rates. Should they raise rates, which all signs are pointing towards, the dollar will fall even further and commodities will shoot upward.
- When gold is performing so strongly during what is usually a very quiet period for metals, Blanchard sees much higher prices on the horizon for the remainder of the year, and investors should look for any price volatility dips or consolidations as opportunities to diversify into gold if they have not already, or for existing gold investors to add to their long positions.
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Copyright © 2010 Blanchard and Company, Inc.
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