http://goldnews.bullionvault.com/gold_jobs_120420091

Gold Dumps, Stocks Surge with Dollar on US Job Loss Data - Friday 4th December 2009

Gold fell through $1200 an ounce for the first time in 3 days lunchtime Friday in London,
falling fast to $1190 and below on news that US unemployment rose by just 11,000 last month.
Wall Street analysts expected 111,000 job losses in November. The unemployment rate ticked down to 10.0%.

The US Dollar leapt on the news, and London's FTSE100 share index reversed an
earlier 0.6% loss, rising fast alongside French and German stocks.

Government bonds fell hard, driving 10-year US Treasury yields up to 3.70%.

The Gold Price also extended its retreat against other major currencies, dropping
1.2% through €800 and losing 2.5% from Thursday's all-time high vs. the Pound.

The UK Treasury today leaked news that next week's pre-budget report will not
apply "any dramatic fiscal tightening".

British investors looking to Buy Gold lunchtime Friday saw the price slip to
a near 4-session low of £718 an ounce.

"We are bullish while [Gold] achieves fresh highs, but cautious of any quick reversal,"
said the latest technical analysis from Scotia Mocatta this morning, suggesting a
trailing stop loss "below 1183 for short-term traders."

"We believe that gold will have to shift into the slow lane," says Wolfgang Wrzesniok-Rossbach
at German refining group Heraeus in his latest Precious Metals Monthly.

"At some point or other, the price will undergo a significant correction. What
event might trigger such a fall and at what level this process will start, however,
remains to be seen. [But] the price targets, on the other hand, seem somewhat clear:

"$1080, $1050 and $1025 each represent powerful support levels on the charts."

"A rally like this one cannot continue forever," agrees Mitsui in its latest note,
but "with the momentum the yellow metal has been carrying, it is risky business to
stand in its way."

Nineteen out of 24 professional traders and analysts interviewed by Bloomberg today
reckon that gold will rise next week, the newswire says.

Reuters in contrast says that "most" of the 33 professionals it surveyed this
week see gold prices hitting a correction before year-end.

Over in the official sector meantime, "China has the scope to step up gold purchases
but should take a long-term approach, avoiding the open market," said Zhang Bingnan,
a senior member of the China Gold Association, to Reuters at the Shanghai Gold Conference on Thursday.

"If we adopt a too aggressive and rash manner, it is not practical," he said.

China is now the world's No.1 Gold Mining nation. The People's Bank is widely thought
to have grown its gold reserves by buying domestic production direct.
Private Chinese gold buying will overtake Indian demand this year, GFMS consultancy
chairman Phillip Klapwijk confirmed at the same conference today, forecasting consumer
off-take of 432 tonnes vs. India's 422.

Gold is a safe haven because there is "no violation of contract," the China
Gold Association's Zhang said to Reuters.

"Gold is the only non-credit product in the financial market."

Writing in a Communist Party newspaper, Li Wei – vice director of Beijing's
Assets Supervision & Administration Commission – said Thursday that "intentionally
complex and highly leveraged products were fraudulently peddled [to China] by
international investment banks with evil intentions.

"To a certain extent some international investment banks were the chief criminals
and the root of ruin for the Chinese enterprises who encountered this financial
derivatives Waterloo," Li said of the post-Lehmans' slump, reporting a 9% loss on
$18.3 billion of hedging and speculative contracts held by some 130 state-owned firms.

Swiss banking giant UBS and the Standard & Poor's rating agency yesterday announced
a new "S&P 500 Gold Hedged Index", based on the total return of the S&P 500 stock
market index but with an added position of long Gold Futures contracts.

"In a gold-hedged strategy," said Liz Taxin, S&P's director of strategy, "investors
are seeking to eliminate the risk of US Dollar fluctuations and are therefore willing
to sacrifice potential currency gains against gold."

Looking ahead to 2010 in the forex market, "Amongst the major currencies there's
three specific risks next year," says Steven Barrow at Standard Bank in London today.

"One is that the Dollar falls far quicker than expected, another is that we see
bailouts in the Eurozone, and another is that we see a hung parliament in the UK election."

Yesterday the US, European and UK central banks all signaled changes to their
emergency aid to domestic financial houses.

The Bank of England said it may sell as well as buy corporate bonds – currently
totaling £1.5 billion ($2.6bn) of its £185bn quantitative easing purchases –
using the proceeds to support new non-government debt issues.

Holding its key lending rate at 1.0%, the European Central Bank said the final
chunk of its 12-month loans to Eurozone banks will be charged not at that all-time
record low, but at the average ECB lending rate of the coming year.

In Washington, Ben Bernanke told the Senate committee set to vote on his
second five-year term as US Fed chairman that his central bank will withdraw
liquidity at an "appropriate time and pace".

Analysts noted that he failed to repeat the Federal Reserve's recent statement
that it would keep interest rates "exceptionally low for an extended period."

"The ECB's move just marks the beginning of an end and has been widely expected.
The recent rally in gold was built on expectations that the ECB will move ahead
of the Fed," reckons Market Strategy Institute Analyst Koichiro Kamei in Tokyo.

.........

Adrian Ash, 04 Dec '09

http://goldnews.bullionvault.com/gold_dollar_120720095

Gold Drops 7.3% from Record High, Dollar Rally "Temporary" as Russia Extends Bullion Hoard -
Monday 7th December 2009
Adrian Ash, 07 Dec '09

extract
Gold fell sharply at the start of London dealing on Monday, extending its drop from Thursday's new record highs
to 7.4% as the US Dollar rose and European stock markets fell.

Recording its lowest Gold Fix in London since Nov. 20th at $1147.50 an ounce, the price of gold also hit a two-week low vs. Euros and Sterling.

The US Dollar hit its best level in a month against both the European single currency and the Japanese Yen.

Priced in Dollars, crude oil fell towards an 8-week. Government bond prices rose, pushing the yield offered by 10-year US Treasuries down to 3.44%.

"We could be looking at continued liquidation today," says one London gold dealer.

"There is talk of sell stops in the low $1130s," adds a Hong Kong trader."

"Since August, we have advised buying dips in gold," says Walter de Wet at Standard Bank.
"We now advise selling into rallies on approach of $1200 – probably our new strategy into year-end."

"Being a Dollar bear is not risk-free," says de Wet's colleague at Standard, Steven Barrow.
"But...we maintain that [a Dollar rally] would be temporary and that the Euro will reach at least €1.60 next year."

Attempting to put a valuation on gold, a survey of 218 fund managers running $530 billion between them
says that 25% think gold is over-priced – up from 11% in October – according to Bank of America Merrill Lynch.

"If the world falls into an abyss, gold could be a store of value," said James Paulsen, manager of $375 billion
at Wells Capital Management in Minneapolis, to Bloomberg overnight.

"[But] from my experience, the world has not ended yet."
.....

Unusual movement of gold price earlier today.
It looks like an industrial drawing.
(Close price a moment ago $1,158.15/oz)

SL - that would just be the spread from an illiquid sub-market, IMHO

Thanks ben but I am still in the dark as to how "an illiquid sub-market" works.??
Maybe someone can add it to the Glossary section.

Interesting story :-

Gold bull has many years, thousands of dollars to go

http://www.sprott.com/Docs/InvestorsDig ... o%20go.pdf

May have to revisit the threat on Gold companies!!
Cheers
JP

Good read JP ...time to buy a metal detector!!

maybe so but the short term (3-4 months) dont look too good for gold atm.

You dont see this every day

https://marketforceanalysis.com/index_a ... ARKETS.pdf

That article is what I suspected for a long time but I did not know who was doing the manipulation.
Nice one muhaha.
Worthy of a MASSIVE class action.

Seems like we will see somewhat of a correction in gold in the near term 1170 break, time to go short till about 1050 .

well first leg complete, and a successful short completed. I guess after my Euro long tragerdy i am taking more profits and being more disciplined.