Sorry!! The article you are trying to read is not available now.
Thank you very much;
you're only a step away from
downloading your reports.

Is the London Fix in for Gold?


Litmus test for both yellow metal and silver.


The market is at a critical juncture, and it's testing my whole paper-versus-physical-metal theory and analysis.

Lowest close in gold and silver: Gold 764, silver 11.17 at the time of this writing. Below the 775 level, many charts pick up on.massive physical buying and, same as last time, it's paper gold trading down here.

There hasn't been a London Gold Fix below the 775 level in this whole sell-off; note the London AM fix last night was 799+. The physical market will tell us much tonight at the rate-set. If it sets below 775, I'll be shocked, and if it sets below there for 10 days, I'll have to re-assess my whole analysis.

This is the litmus test. The current 764 price is some $35 an ounce below physical yesterday. If they try and set London Fix there tonight, I can't imagine how much gold will be required to satisfy physical demand down here. It will probably set around 782-78 or so, is my expectation.

Note that gold is down in all currencies, so it's not just a dollar move. That the government bailed out Fannie Mae and Freddie Mac is a disaster, but no one seems to see it that way. Inflation is out of control. Period.

Silver has been canned, and again, it's all paper silver. Investors for physical silver can't get enough, and there are large delays in delivery (apart from large bars). The gold-silver ratio (68) is the worst it's been since 2004. Many have forgotten that silver isn't just an industrial metal - expect a savage rebound to 12.70 in a few days.

Want top traders to sit at your desk and share their insight and ideas?
Minyanville's Buzz and Banter- 14 day FREE trial

< Previous

The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.

Featured Videos