"However, Asian traders spoke of some 4,000 lots of gold being ‘dumped’ on the COMEX and of a “large sell order”.
This would suggest that the sellers may not have been profit motivated and official selling may have been involved.
After the Swiss franc intervention and currency debasement yesterday, market participants are wary of further official government and central bank intervention. With further gains for the Swiss franc artificially capped (at least in the short term), it would be naïve to exclude the possibility of intervention in the gold market and a continuing strategic capping of the price.
“The start of full-on currency wars has started in earnest,” said Maurice Pomery, chief executive at Strategic Alpha, quoted in the front page of the Financial Times today. “After currency wars come trade wars and as we see the exporting world pressured as the developed world contracts, tensions will rise.”
Central banks, from the Swiss National Bank to the Bank of Japan, are openly intervening in the currency markets and devaluing their currencies and therefore may be surreptitiously intervening in the gold market.
The safe haven Swiss franc is now pegged to the not so safe haven euro and Japanese money printing is leading to question marks over the safe haven status of the yen. Therefore, risk averse money is likely to flow into gold.
Gold is an internationally traded currency that is not controlled by any one government and therefore cannot be debased, unlike fiat currencies. A way to control gold (at least in the short term) is by market manipulation and capping or lowering the price at key strategic and psychological moments in order to prevent enthusiasm and the public from seeking out the safe haven.
Reuters reports this morning that analysts believe that “expectations that other central banks may step in to intervene in the currency market” may have contributed to the “restraint” in the gold market overnight.
Given the fact that global currency wars have intensified and will likely escalate in the coming weeks, we should be mindful of peculiar and volatile short term movements that give false signals.
All interventions and market manipulation can be successful in the short term but as ever the real fundamentals of supply and demand will dictate the price of all goods, services, assets and currencies in the long term.
Investors and store of wealth buyers should continue to buy on the dip."
at http://www.marketoracle.co.uk/Article30303.html
This would suggest that the sellers may not have been profit motivated and official selling may have been involved.
After the Swiss franc intervention and currency debasement yesterday, market participants are wary of further official government and central bank intervention. With further gains for the Swiss franc artificially capped (at least in the short term), it would be naïve to exclude the possibility of intervention in the gold market and a continuing strategic capping of the price.
“The start of full-on currency wars has started in earnest,” said Maurice Pomery, chief executive at Strategic Alpha, quoted in the front page of the Financial Times today. “After currency wars come trade wars and as we see the exporting world pressured as the developed world contracts, tensions will rise.”
Central banks, from the Swiss National Bank to the Bank of Japan, are openly intervening in the currency markets and devaluing their currencies and therefore may be surreptitiously intervening in the gold market.
The safe haven Swiss franc is now pegged to the not so safe haven euro and Japanese money printing is leading to question marks over the safe haven status of the yen. Therefore, risk averse money is likely to flow into gold.
Gold is an internationally traded currency that is not controlled by any one government and therefore cannot be debased, unlike fiat currencies. A way to control gold (at least in the short term) is by market manipulation and capping or lowering the price at key strategic and psychological moments in order to prevent enthusiasm and the public from seeking out the safe haven.
Reuters reports this morning that analysts believe that “expectations that other central banks may step in to intervene in the currency market” may have contributed to the “restraint” in the gold market overnight.
Given the fact that global currency wars have intensified and will likely escalate in the coming weeks, we should be mindful of peculiar and volatile short term movements that give false signals.
All interventions and market manipulation can be successful in the short term but as ever the real fundamentals of supply and demand will dictate the price of all goods, services, assets and currencies in the long term.
Investors and store of wealth buyers should continue to buy on the dip."
at http://www.marketoracle.co.uk/Article30303.html
