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PRECIOUS-Gold rebounds more than 1 pct ahead of Obama speech

Thu Sep 8, 2011 3:24am EDT 

 * Spot gold rallies 1.5 percent, U.S. gold 1.6 percent after
3 pct drop
 * Physical purchase active as buyers exploit lower prices
 * Spot gold could fall to $1,793.19 -technicals
 
 * Coming up: U.S. President Obama addresses Congress; 2300
GMT

 (Writes through; adds comment, details; updates prices)	
 By Rujun Shen	
 SINGAPORE, Sept 8 (Reuters) - Gold prices bounced back more
than 1 percent on Thursday, boosted by bargain-hunters after the
previous session's fall of 3 percent, ahead of a speech by U.S.
President Barack Obama that could allay recession fears.	
 Obama will lay out a jobs package worth more than $300
billion later on Thursday, after data showed the world's top
economy added no new jobs in August. 	
 Gold prices dipped to below $1,800 in the previous session,
triggering a wave of buying during Asian hours. The price of
cash gold rose as much as 1.5 percent to $1,843.49 an
ounce and pared some gains to $1,840.66 by 0641 GMT.	
 The most-active U.S. gold futures contract GCcv1 rose 1.6
percent to $1,846.6, before easing to $1,843.50.	
 

 	

 

 The uncertainties around global economic growth have
propelled gold to consecutive record highs since July, and are
expected to underpin sentiment for the metal until investors are
convinced the danger of recession is past.	
 Obama's speech may offer hopes of improving the labour
market, but the uptick in risk appetite is likely to be
temporary.	
 "All his package may do is lessen the fallout of recent
knocks to confidence from the euro zone sovereign debt crisis
and U.S. ratings downgrade," said David Thurtell, a Citigroup
analyst.	
 Buyers rushed to the physical gold market after prices
dropped as much as 6.6 percent in the past two sessions from a
record high of $1,920.3 hit on Tuesday. 	
 	

 RISK APPETITE IMPROVES	
 Investors abandoned precious metals for the riskier stock
market on Wednesday, as Germany's top court rejected lawsuits
aimed at blocking German participation in emergency loan
packages, but gave its parliament more say in
bailouts. 	
 The euro slipped and European stock index futures inched up
ahead of a European Central Bank meeting later that is expected
to call a halt to its rate tightening circle to support
economies battered by the debt crisis. 	
 Technical analysis suggested that spot gold could fall
towards $1,793.19 later in the day, said Reuters market analyst
Wang Tao. 	
 "The gold market is anticipated to maintain its downward
trend in the near-term, with a fall toward $1,750 possible over
the next few days," Tom Pawlicki, an analyst at MF Global, said
in a research note.	
 The direction of the market is less than certain, as an
uncertain economic outlook in the United States and Europe,
mixed data, Obama's job packages and deteriorating technical
indicators vie for investors' attention.	
 In a sign indicating caution among gold investors, holdings
of SPDR Gold Trust and iShares Silver Trust have
remained unchanged for a few days. 	
	
   Precious metals prices 0641 GMT
  Metal             Last    Change  Pct chg  YTD pct chg    Volume
  Spot Gold        1840.66   24.20   +1.33     29.67
  Spot Silver        41.75    0.23   +0.55     35.29
  Spot Platinum    1833.49   18.04   +0.99      3.73
  Spot Palladium    752.97    5.99   +0.80     -5.82
  TOCOM Gold       4584.00   11.00   +0.24     22.93       110262
  TOCOM Platinum   4599.00  -15.00   -0.33     -2.07        10662
  TOCOM Silver      103.60    1.00   +0.97     27.90          735
  TOCOM Palladium  1899.00   19.00   +1.01     -9.44          329
  COMEX GOLD DEC1  1843.50   25.90   +1.42     29.70        37251
  COMEX SILVER DEC1  41.85    0.21   +0.51     35.25         3056
  Euro/Dollar       1.4073
  Dollar/Yen         77.35
  TOCOM prices in yen per gram. Spot prices in $ per ounce.
  COMEX gold and silver contracts show the most active months
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Comments (1)
USGoldBuyers wrote:
Although it does not take a rocket scientist to understand that the stock market price of gold is inversely related (X increases as Y decreases) to the overall health of the economy, it is difficult to predict when the economy will shift downwards or upwards. If we could predict these market trends, we’d all be millionaires or billionaires like Warren Buffett.

After two years of analyzing, dissecting, examining, probing & studying the precious metals markets -mainly gold, one of the best piece of advice is look for positive/negative economic announcements, forecasts, outlook, predictions, etc. from the President, Congress, Federal Reserve, high-ranking political figures, world’s top financial analysts, etc.

In this case, President Obama will be addressing Congress — his speech will lay-out a jobs stimulus package worth more than $300
billion — this should help reduce recession fears & drive the economy up; which in-turn, should drive gold prices down…remember, gold is a “safe-haven” against economic misfortunes. In layman’s terms, picture a “see-saw” with the economy on one end & gold prices on the other end…when one goes up, the other goes down. – Kevin Morris | Public Relations Director & Rocket Scientist for US GoldBuyers, Inc.

Sep 08, 2011 12:13pm EDT  --  Report as abuse
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