You are here
Downside manipulation in gold gets noticed in Dubai
Will Gold Sink to $1,650 as 'Mystery Sellers' Dump Yellow Metal?
By Vicky Kapur
Emirates 24/7, Dubai
Thursday, December 6, 2012
Spot gold prices tumbled to a near 30-day low of $1,687 a troy ounce Thursday morning, down $63 per ounce from last week's high of $1,750 per ounce as rumours of a mystery seller unwinding a major hedged position gained currency.
"We're actually seeing a fairly mysterious seller in the Asian time zone over the last week on two occasions," said Jeff Rhodes, CEO of the Dubai-based INTL Commodities.
According to Rhodes, the "mystery seller" times his deals in the "twilight period," or after the London market closes and just before the Asian markets really get going, when the trading is thin. "We've seen some fairly large sell orders hit the market in this twilight zone," he told the Dubai Eye 103.8 radio station.
... Dispatch continues below ...
GoldMoney adds Toronto vaulting option
In addition to its precious metals storage facilities in Hong Kong, Switzerland, and the United Kingdom, GoldMoney customers now can store their gold and silver in a high-security vault operated by Brink's in Toronto, Ontario, Canada.
GoldMoney also has recently partnered with Rhenus Freight Logistics to offer another gold storage option in Switzerland. The Rhenus vault is in the secured zone of Zurich Airport and offers customers superb security as well as the ability to inspect their gold.
Storage at the new vaults in Canada and Switzerland is available at GoldMoney's lowest fees. Customers can select their storage location when placing their buy order.
GoldMoney customers can take delivery of any number of gold, silver, platinum, and palladium bars from any GoldMoney vault, as well as personally collect their bars stored in the Hong Kong, Switzerland, and U.K. vaults.
It's easy to open an account, add funds, and liquidate your investment. For more information, visit:
The large sell orders in a thinly traded market have had "quite an impact," says Rhodes, with gold plunging from $1,750 to just above $1,690. "It's mysterious. I can't explain it," he says. "It's almost as though there is a speculator or speculators who are just trying to trigger a technical move to the downside," Rhodes maintains.
The yellow metal continued to edge down on Thursday, holding near a one-month low of $1,684 that it made yesterday, as a stronger dollar kept the pressure on precious metals in general.
While physical bargain buying was evident in Asian markets, thin volumes failed to make any positive impact on gold prices and the metal remains in a short downtrend that analysts are partly blaming on the stalemate in "fiscal cliff" negotiations in the United States.
The large mystery sell orders aimed at triggering a downside move in prices may be "a prelude to buying gold," Rhodes says. "I don't know, but there are definitely some funny games going on at the moment," he suggests, and adds that he thinks these games will continue through year-end.
If indeed the mystery sales continue for another couple of weeks as Rhodes suggests, gold prices are in for further downside, perhaps inching toward the $1,650/oz mark. "It's going to be an interesting market for the next three weeks," Rhodes reckons, as his experience shows that this is the thinnest period of the year.
"Many players are closing their books for the year -- they've either made what they've made for the year or they've lost and don't want to lose anymore. ... Either way, they take to the sidelines and that results in exactly the kind of market conditions where you see erratic price movements."
Nevertheless, on Wednesday Goldman Sachs cut its 2013 gold forecasts and said gold's current bullish price cycle could take a U-turn next year as a rise in real interest rates on the back of improved growth offsets any further balance sheet expansion from the Federal Reserve.
Goldman cut its three-, six-, and 12-month forecasts for gold prices to $1,825/oz, $1,805/oz, and $1,800/oz, respectively.
The investment bank also introduced a 2014 forecast of $1,750 an ounce, suggesting price growth could tail off.
* * *
Join GATA here:
Vancouver Resource Investment Conference
Sunday-Monday, January 20 and 21, 2013
Vancouver Convention Centre West
Vancouver, British Columbia, Canada
* * *
Support GATA by purchasing DVDs of our London conference in August 2011 or our Dawson City conference in August 2006:
Or by purchasing a colorful GATA T-shirt:
Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009:
Help keep GATA going
GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at:
To contribute to GATA, please visit: