June 17, 2010 - At midday on Thursday, June 17, August gold futures were breaking the record they set just last week, as claims for jobless benefits in the United States rose last week after three weeks of declines. All the major stock indices were down slightly, but investors are clearly moving away from risk. Charles Nedoss, an analyst with Olympus Futures, noted this morning in MarketWatch, “Equities are in a precarious situation.” He believes that investors are seeing stocks as “overbought” and are looking to buy gold for its safety.
With gold prices going up, investors are wondering if it’s still a good time to buy gold. Peter Hillyard, head of metals sales at ANZ Investment Bank, said to Reuters this morning, “The mood is with gold right now, the momentum is with gold and the market will either do nothing or go up.” The precious metal has gone up by close to 14 percent on the year. Prices have stabilized over the last few days, but analysts seem to expect more bad economic news — meaning more good news for gold.
Commerzbank senior trader Michael Kempinski says, “I’m quite optimistic for gold, especially gold in euros.” The eurozone is running on fear and anxiety right now, with Greece’s credit being reduced to junk and rumors of a bailout of Spain. All of these factors point toward the impetus to buy gold, even as prices approach the record again.
George Gero, vice president of RBC Capital Market Global Futures, explained this morning that jobless claims are heavily impacting gold trading today. He says that “gold acts like it wants to take out the $1,250 area,” and that gold is holding its ground around its new prices levels. It may indeed be a good time to buy gold, as the market really shows no signs of stopping.
John Halloran
Senior Gold Specialist - Buy-Gold.org
