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Gold Crash Ahead - Fasten Your Seatbelts
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by bullionadvisordotcom | April 27, 2009 at 04:38 pm
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UPDATE 3. Gold has stabilized for now, trading below $890 at $887.70 at 7.15PM EST. Some analysts attributed the sharp sell off to expiring futures and options contracts. However, we still believe that a massive decline is underway, driven by the need to raise cash liquidity. Developing Story.
UPDATE 2. Gold continued its dramatic decline, trading as low as $883.40 during the morning session in New York. This represents an almost 5% decline from Sunday's open. Developing Story.
UPDATE 1. Gold Crashed through the psychologically important $900 level and was trading at $897.90 at 9PM EST. The overnight sell-off accelerated after a sudden drop of $12 roughly one hour into the Sydney market session. Developing Story.
We have a pandemic flu scare in North America. Naturally, gold is down today. Wait, isn’t this the kind of event that causes people to preserve their buying power? No, actually, this is the kind of event that causes a bad economy to get worse - unless you’re in the survival supplies business.
Gold should be on its way to new lows now. Lets see how the price decline accelerates over the next few weeks. One indicator, committment of traders data, is bullish. These traders can change their minds quickly. When gold breaks below $900, that will be the initial signal that things are about to get ugly.
Any surprise announcements from emerging markets and their central banks that they are buying gold, or that they have bought gold for the past five years (ala China) would delay the decline. Frankly, I’m not expecting any surprise buying announcements…most of these countries don’t have as much money to buy metals of all types anymore.
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Most RecentMost Recommended Comments (2)
at 17:40 on April 27th, 2009
The mid term driver of gold prices will be the stagflation that is around the corner in the US economy as trillions of dollars of "free" paper hits the streets. Gold will benefit from this monetary "easnig".
at 17:46 on April 27th, 2009
Eastvanray, you could be right in the long run, but what I think readers need and want to know most, right now, is what is happening to the price of Gold right now. Thank you for your comment. I agree with you, but in the long run.