Gold Price Drops-Bite the Bullet

November 28, 2007 | By | 1 Reply More

In the face of falling crude oil prices and a slightly stronger dollar, gold weakened by around 2% on Tuesday.

 

Some profit taking also helped to push the price down to $808 an ounce before recovering to $814 an oz by the close. As usual silver followed with platinum and palladium tagging along.
 

It will be interesting to see how things develop today. Under $800 could be a buying opportunity. This could be the time when some chart gazing might provide an opportune entry point.

 

For technical simpletons, breaking below the fifty day moving average, observing trend lines and support and resistance can be useful in short term situations.

 

In the near term support is around $805 so a break below could set up some signals if you are in the long-term gold bull camp.

 

It seems that hardly a week goes past when industry or science does not discover another application for one or other of the PGMs.

 

Try this for size. Not sure what this means in practice but it has been announced that scientists in South Korea have discovered that using Rhodium as a catalyst made alcohols highly reactive at room temperatures. This has significant potential for use in organic synthesis.

 

The point being that silver and the PGMs seem to becoming more and more important in industrial, medical and other applications as time passes.

 

Unlike gold, which has minimal use in industry outside jewelry, and whose principal virtue is as a store of value in the face of declining currencies, silver and PGMs have the added benefits to farsighted investors due to their ever increasing and diverse uses coupled with production shortfalls.    

 

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Category: Gold

Comments (1)

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  1. dave0 says:

    If the gold correction is still in play my chart expects to visit 762 or 747 to 742. Below that I have a last reversal from 716 and below that I start to get alarmed :-)

    Just my tech perspective for what its worth.

    Dave.

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