Gold and Silver's Daily Review for 23rd December 2010


As Asia’s day became London’s morning the gold price in dollars appeared to fall. It went from $1,388 to $1,384. While this is not a large move it highlights an important feature and that is that the euro is falling faster against the dollar than before.

In the euro the gold price is very close to its €1.062 level and is standing at €1,056.9. A look at the performance of gold in the euro over the last few days shows a consistent strength. The last two Fixes have been €1,056 and €1.059. Clearly the market in gold is being made in the euro, reflecting demand from outside the U.S. U.S. gold selling from E.T.F.’s is being taken up in Europe and elsewhere. So watch the euro price of gold to see what the physical gold market is doing at the moment.

Gold – Very Short-term
The gold price is being made in the € as you can see in the prices of the last few days. In the dollar as it falls slower that the euro, we will see gold continue to consolidate with a slight bias to the downside in the U.S. dollar. Gold This should continue today, in New York.

Silver – Very Short-term
The silver price is following gold but with a stronger performance than gold. As gold slips slightly in the dollar, silver is holding firm in the dollar. This convinces us that silver will continue too outperform gold in the very short-term. This steady to strong performance should continue today, in New York.

Gold Price Drivers
The gold price is being driven by global forces that do not react to news items inside the U.S. Indeed we see factors outside the U.S. as having the major impact on the gold price. These lie below the surface of the day-to-day action in the gold price. When we synthesize these influences we see that they actually act as a steady persistent tidal force that is supporting the gold price, despite items that commentators may feel should warrant a move away from gold. The realities of the change in global economies since the start of the ‘credit crunch’ have not yet been absorbed by the world. The overwhelming desire for the ‘normalcy’ of pre-credit crunch days has distorted the perspective of so many analysts and the media that there has been an under reaction to the crisis. While one can sympathize with this, it is in fact undermining the needed efforts at economic and financial changes needed to cope effectively with the crises that have appeared and will appear in the future. This is ensuring that gold will remain in a rising market, not simply a ‘bull’ market. In the next few issues of the Gold Forecaster and Silver Forecaster we will be looking at the path ahead for gold and silver. We will also publish reports on companies like Coeur d’Alene [silver and gold] and other attractive Junior mining companies in the gold and silver worlds.

Julian D.W. Phillips

Apart from covering the gold and silver markets Gold Forecaster and Silver Forecaster are structured in a way that gives perspective to macro-economic factors from oil to currencies covering the pertinent global gold markets that directly affect the gold price and some that simply influence it. It is a “must-read” for all who want to understand why the gold price is moving as it is and why. It also aims to help you understand why currencies and today’s national economic problems are influencing the global economy and the precious metal prices [we cover platinum in the Silver Forecaster too]. Subscribe at or for silver at].