Today (Thursday), gold fell to its lowest level since January. There are three reasons why today's gold price is going down...
why gold is down
- Why Today's Gold Price Is Going Down – September 2014
- Why Gold Prices Fell 3.3% in July After an Early Climb
- Why Today's Gold Price Is Going Down – May 2014
- Why Gold Prices Are Down Today
- Why Gold Prices Are Down Right Now
- Why Gold Is Going Down Today
- Today's "Gold Convergence" Is Your Best Buy Signal Yet
- What's Driving Gold Prices Today
- Experts Predict 30-Day Window for Gold
- Why Gold is Down Today
- Why Gold Prices Are Going Down Today
- How to Invest in Gold: Tips from an Expert on the Yellow Metal
- Gold Prices Are Bargain for India's Consumers, But Problem for Government
- Rick Rule Explains Falling Gold Prices
- With Gold Prices Down, Here's Where the Money is Flowing
- The Love Trade for Gold is Still On!
Gold prices are up for the year, but fell 3.3% in July.
Gold started the month off strong as geopolitical conflict rocked parts of Europe.
Today's gold price was modestly lower Wednesday after Tuesday's rout left the yellow metal at its lowest level in 15 weeks.
In morning trading, the most active contract, August Comex gold, slipped $8.40, or 0.67%, at $1257.10. Spot gold was lower by $6.90, or 0.55%, at $1,256.40.
Gold prices took a beating Tuesday, plunging nearly 2% and marking the yellow metal's worst day of the year.
Spot gold prices fell to a low of $1,228 an ounce intraday, but managed to claw back some gains in the afternoon. Still, even fresh Consumer Price Index (CPI) figures showing a slightly higher than expected read on inflation in March failed to goose gold prices much.
Inflation and crisis – of which we’ve had plenty – historically drive gold prices up, and yet the London spot price has fallen 24% since Jan. 2. Like the infamous honey badger, gold prices just don’t care. But the reasons for gold’s continued fall, in spite of the apparent decay of the world, just might surprise you.
Precious metals investors once again are left to wonder why gold is going down today as the metal hits its fourth consecutive day of declines.
In trading Thursday, gold for December delivery finished the session down $33.20, off 2.4%, to $1,333.60 per ounce. Gold prices on Thursday fell more than $30 in a matter of seconds.
The carnage continued today (Friday). Gold slipped to a five-week low on Friday, off roughly $72 an ounce over the week, marking the yellow metal's worst week since June.
The reasons why gold is going down today are partly related to some trading drama that occurred with gold yesterday...
We've been recommending gold shares for months now, ever since prices collapsed in April. But timing's getting critical, because now the market is telling you gold is set to surge...
The first piece of evidence hit my radar on August 1st, moments after Barrick Gold released its $8.7 billion "news." (More on that in a minute.)
The Commitment of Traders report - perhaps the best leading indicator for gold prices - delivered the second piece of evidence: a staggering 70% spike in "red flag" futures trading. And the third and fourth pieces of evidence just arrived.
But before we look at each of these events in detail, here's what you need to know:
Any one of these indicators is bullish on its own. So when all four signals flash at once, please don't wait.
A "Gold Convergence" like this hasn't happened in 12 years...
Gold prices today are still below $1,300 an ounce as traders in the United States and Europe continue to sell the precious metal.
Western investors were the main driving force behind redemptions of nearly $19 billion in gold-backed ETFs in the second quarter of 2013.
We've been studying the resource markets - and gold in particular - for over 30 years. And have seen almost every cycle the yellow metal has gone through.
One thing is certain in our opinion: International investors, central banks and corporations are all looking to buy gold... And these slow summer months are likely providing the best price.
Asian investors, especially in China and India, are buying coins and bullion like mad. Sales are up 22% annually in China and 52% in India.
Gold analyst Jim Willie put it best when he said: "The migration of gold from West to East is the grand story of the decade." They know, as our dear friend Richard Russell recently reminded us, that gold and international power still go hand in hand.
Beyond the obvious demand, history is also on gold's side. Gold's movements are in line with historic trends, never mind what the no-nothing, hand-wringing Cassandras are saying.
In fact, we believe this is a unique moment in history to get gold on the cheap, and take advantage of before the end of summer.
Of course, the ongoing "tapering talk" from the Fed pushed gold down sharply. That's because if the Fed stops stimulating the economy, an inflationary outcome is unlikely, especially if it's combined with higher interest rates that boost the value of the dollar. That's bad for gold.
What's more, there may be darker forces at work as well. There's a distinct possibility the gold market was manipulated [Editor's Note: here's who did it].
Yet the bottom line is that nothing material changed to justify a $700 drop in gold prices from over $1,903 in 2011 to almost $1,200 earlier this month.
In fact, this 36% fall is clearly...
Read on to see the forecast for gold prices...
Can a continued reaction from the Fed be why gold is down today - a week after the FOMC meeting?
Both gold and silver tumbled to near three-year lows in overnight trading.
"Actually, I think we've got multiple factors at work here," Money Morning resources expert Peter Krauth told us when we asked him to explain the 4.13% ($52.80) fall in gold prices today.
"First, it's an ongoing reaction to the Fed," said Krauth. Last week Team Bernanke sent stocks and gold tumbling on the idea that the Fed's quantitative easing measures could taper by year end.
"Second, rising interest rates create a bit more opportunity cost for owning gold," continued Krauth. "Third, we're in summer now, a seasonally weak period for gold, and finally, there's ongoing apathy for gold as official inflation remains tame."
Official government-reported inflation is 1.7%.... Although you probably would argue otherwise if you've been grocery shopping recently. That's still below the Fed's 2% target.
Comex August gold fell $76.50, or 5.56%, to 1,229.50 in early morning trading Thursday. The August contract traded as low as $1,285.00 in overnight trading as the U.S. dollar rose to the highest in more than a week against six major currencies.
Gold prices plunged Thursday to near three-year lows as precious metals investors took a "risk-off" stance following Wednesday's FOMC meeting. Bernanke announced that the current $85 billion worth of monthly bond purchases could slow near the end of this year, and end in 2014, if the economy keeps improving.
He said interest rates could increase "far in the future."
Rick Rule, the founder and chairman of Sprott Global Resources Investments, provided the answers.
Rule says he'd put a portion of the money into gold bullion and a portion into gold stocks.
But he warns those unfamiliar with the sector should stick to what they know: If you're bullish on gold, buy gold, but realize gold stocks don't necessarily mirror the price of the yellow metal.
The last several months have been tough on gold prices, but gold bugs haven't lost their insatiable appetite for the yellow metal. With gold officially in a bear market, demand is surging at today's bargain prices.
Gold demand is especially strong in India, where gold is the investment of choice among consumers. India's gold imports reached 162 tons in May, almost twice the average level.
That's why last week the country - the world's biggest consumer of gold - increased the duty of gold imports for the second time in six months.
The duty was boosted from 6% to 8% on gold ore, and from 5% to 7% on intermediate products
in attempts to decelerate the accelerating gold demand. Bullion prices fell 0.25% to $1,399.36 an ounce following the move.
Gold imports are one of the biggest contributors to India's mushrooming account deficit (which occurs when imports exceed exports). An increasing deficit affects the country's foreign exchange reserves and the value of its currency.
Friday, the ruppe closed below the key 57 mark against the U.S. dollar for the first time in a year. The slide further casts a shadow on India's economy amid pricier imports and heightened inflationary risks.
Policy makers in India have been attempting to reduce its deficit and improve finances as it faces possible rating downgrades. They hope the duty increase will help.
The Federal Reserve and other central banks keep printing money. The U.S. stock market is soaring. And gold prices, after a brief recovery, have continued their plunge.
Are these phenomena connected? We put the question to one of the world's foremost gold experts, Rick Rule, founder and chairman of Sprott Global Resources Investments.
Listen to his explanation for falling gold prices in the following interview.
And even as gold prices sink, mining costs have climbed. If gold prices keep falling, miners could take "fairly drastic measures" to remain profitable, according to Rule.
As pointed out in a recent article by Money Morning Global Resource Specialist Peter Krauth, there is something interesting happening with gold prices.
Paper gold, controlled by Wall Street, is going down. But demand for physical gold all over the globe is going up every time that gold prices are down.
That's not the only place divergences are occurring in the global gold market. A divergence can even be seen in the difference between Wall Street speculators and commercial interests in the paper gold market.
The speculative momentum players continue piling on shorts, while commercial interests are following a path 180 degrees opposite.
The question remains for those investors interested in gold as to who will be right in the end. The short-term Wall Street speculators or more long-term players?