Gold Prices Volatile as $1,400 Still Eyed

Source: The Street, Alix Steel (10/15/10)

"Prices should head higher in the short term on QE."

Gold prices were volatile Friday as investors vacillated between buying gold as protection and taking profits.

Gold for December delivery was losing $1.80 to $1,375.80 an ounce at the Comex division of the New York Mercantile Exchange. The gold price Friday has traded as high as $1,386.40 and as low as $1,373.50.

The U.S. dollar index was slipping 0.25% to $76.35 while the euro was rising slightly to $1.41 vs. the dollar. The spot gold price Friday was falling $6.60, according to Kitco's gold index.

Gold prices got an initial pop after a speech Friday morning from Federal Reserve Chairman Ben Bernanke who, while not putting a dollar amount on more monetary easing, said inflation "can be too low" and that "overall economic growth is less vigorous than we would like," which most analysts took as a green light for more accommodative measures from the central bank.

Adding fuel to Bernanke's argument was the fact that the core Consumer Price Index for September was unchanged. Bernanke said that the Fed's next steps will be dictated by economic data and that a lack of inflation in September will certainly support the thesis that more money printing is needed.

Gold's rally was crimped somewhat Friday as profit-takers emerged and investors opted for stocks over gold on rising retail sales and the New York State Manufacturing Index. Traders might also be looking to book gains after gold's monster rally this week and on the heels of options expiration.

However, most analysts predict that gold prices should head higher in the short term amid the backdrop of monetary easing. George Gero, senior vice president and financial consultant RBC Capital Markets Global Futures, said that "buyers appear from everywhere at the first sign of profit-taking as currency weaknesses are hedged to maintain purchasing power."

With gold prices eyeing $1,400 an ounce, the question remains just how high can the metal go?

Announcing Streetwise Live! Events
Source: Streetwise Reports (07/13/2020)

Streetwise Reports is offering 100 investors—at no charge—the opportunity to meet via Zoom with executives of precious metals companies as they discuss recent developments at their companies and upcoming catalysts.

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Source: Marc Davis, BNW News (05/25/2010)

Latin America, the world's last great mineral frontier for prolific gold discoveries, is proving a godsend for some lucky investors.

Mexico: Gold's Next Powerhouse Player
Source: Marc Davis, BNW News (11/03/2009)

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Source: Brent Cook, Exploration Insights (04/14/2009)

Given the declining global gold production, mining companies’ demand for reserve replacement and the acute dearth of new gold discoveries, there is no doubt that real economic discoveries will be exceptionally valuable. . .the opportunity for stellar profits is the best it has probably ever been. Identifying the few successes, however, will require vigilant and constant technical assessment of geology and drill results, always with an eye to mine economics.

Congo Completes Mining Review, Says Majors Quit Talks
Source: Reuters (12/20/2008)

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I haven’t spoken to my old mining stock friend, noted and universally respected gold stock guru, Bob Bishop, about Rare Element in a year, but I hear he is still a supporter and very large shareholder. I don’t believe he will hold it against me to remind you that this was one of his favorite holdings when he left the newsletter writing business. . .

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Source: www.financialinsights.com (06/03/2005)

Dr. Richard S. Appel, author of Financial Insights, first became bullish on uranium in mid-2003, when it appeared obvious that its supply versus demand equation was fated to seriously drive higher its price. Since then, a series of events in the uranium industry has led Appel to believe that uranium prices will reach never before seen levels.

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