Gold Sees Continued Profit Taking


"With the dollar under significant pressure, a test of new highs should be imminent."


Gold saw further profit taking yesterday and fell to support at $982/oz. Thereafter it staged an impressive rally and briefly broke back through $1,000/oz. Currently, it has fallen just below this level but is constantly testing that mark and appears to be consolidating at the $1,000/oz mark. With the dollar under significant pressure, a test of new highs should be imminent. Gold production in South Africa, the second-largest producer in the world, dropped 7.6% in July and has fallen consistently in recent months and years despite rising gold prices. The Federal Reserve is desperately trying to create inflation to counteract the forces of debt and asset deflation of recent monthsóbut they should be careful what they wish foróbecause large U.S. creditors are unlikely to tolerate a significant devaluation of the dollar.


Silver also suffered from a bout of profit taking but not only recovered, it pushed to a fresh six-month high of $16.94/oz overnight. It has since retraced slightly to $16.75/oz, but the momentum for sliver seems to be very positive.

Platinum Group Metals

Platinum is continuing to make progress towards $1,300/oz where it is likely to meet resistance. It is currently trading at $1,285/oz. Palladium is range bound between $290-$300/oz, currently at $293/oz and rhodium is $1,600-$1700/oz.

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