Morning Gold Fix: June 2, 2010
Courtesy of www.fmxconnect.com
The fundamental gold story has not changed. In fact, it has only exacerbated in the last 24 hours.
China is taking more aggressive steps to deflate what many are regarding as a real estate bubble. Meanwhile in Euro Land, reality is setting in. No credit, and no currency strength is putting a crimp in the consumer's ability to continue to buy Chinese goods. Low demand of finished product from China leads to less demand from China for raw commodities. We may now be in the middle of a large disinflationary commodity bear market, at least for industrial commodities. For Gold, not so much.
Futures came out strong yesterday in the face of a weaker Euro, Oil, and equities. This is to be expected and part of the pattern. What was not expected was when the Euro popped at mid day. Equities proceeded to pare losses but mysteriously Gold remained firm. (PPT lacks multi-tasking skills?)
As a result, we are keeping two different headline templates next to our keyboards now.
1- Gold was higher today despite_______
2- Gold was higher today as______
We expect a battle with the mainstream media on copyright usage of said phrases, but will take the risk for our readers.
Why will gold continue upward? Because we are buyers of it $300.00 lower, that's why. Not theoretical buyers mind you. Buyers for our P.A.s. We fully expect to be unfilled. Our interest is exactly like a trapped short beneath the market. That said, if we go to market, you will be informed, as only then will Gold once again become a commodity and not a competing currency. Get short when we get filled!
August gold was down 5.1 to $1221.8 per 100 troy ounces as of 7:45 AM EDT, this morning. The June U.S. dollar index was up .295 to 87.020. July platinum was down 4.3 to $1545.1 per 50 troy ounces. July Silver was down 1.76 cents to 18.375.
- Elizabeth Thawne