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Gold Bullion Bars

Tuesday, October 23, 2012

Standard Bank, UBS bullish on Gold Bullion After eight weeks of consecutive increases, gold's net speculative length fell last week. A decline, Standard Bank attributes to "Investor uncertainty over the ability of QE3 to support prices and/or the longevity of Fed's openended commitment to easing." Indeed, the bank wrote in yesterday's daily commodities note that this uncertainty is "weighing on gold", adding that it expects this week's data from the CFTC to show further weakening, although, it cautioned, "we should see some stability as the gold price moves towards $1,700." While the bank believes that the $1,700 level should hold, it says there is likely to be resistance to higher prices between $1,741 and $1,756. "We were not keen buyers of gold at $1,780; however, we would be at $1,700. At $1,780, we estimated that gold was pricing in too much QE already, even when compared to its behaviour during previous rounds of easing by the Fed. Should gold drop to $1,700, it would likely reflect only two months of QE from the Fed - a level we deem reasonable," the bank writes in a commodities strategy note out on Friday. But, it adds, "the fact that the gold physical market in Asia has improved markedly from three weeks ago provides us with some comfort that there could be better support for gold going forward." It does not believe that the physical market will push prices higher, in fact, buying interest remains historically

weak for this time of year but, it says, prices closer to the $1,700 level might entice "much greater buying from the physical market." In its latest daily commodities note, UBS's Edel Tully writes that within the gold market, nervousness and fatigue among investors is understandable "especially after gold's tamer-than-expected response to QE3 and the generally weak price action after a poor attempt to reach the key $1800 mark in early October." Gold's performance of late, UBS writes has been a function of it having to compete with other assets for funds post QE3. Indeed, it writes, "It makes perfect sense that gold would outperform other risk assets in anticipation of QE, but underperform during the aftermath. ... On the surface, a global economic recovery would offer downside risks for gold prices inasmuch as the potential for policy normalisation starts creeping into market expectations." But, while both UBS and Standard Bank are not surprised that gold has been performing poorly this month, neither is bearish on the metal.

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Posted by Richard Davey at 12:16 PM

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▼ 2012 (106) • ► November (9)

▼ October (71) • Gold's "upside is well beyond $2,000," CEF Holding... • Low Asian demand presents golden buying opportunit... • As the Fed's balance sheet grows, Gold could hit $... • McAlvany Wealth Management: "Heavy emphasis on the... • Gold "more likely" to top $2,000 next year, Sprott... • Germany knows: If you don't hold your gold, you do... • Standard Bank, UBS bullish on Gold Bullion • Central banks continue to drive gold prices higher... • "We have a positive view around Gold Bullion," say... • Barclays on gold: "We retain a positive outlook fo... • Billionaire: Gold is "the largest part of my portf... • Gold Bullion imports by India set to rise • China buying up Australia's Gold Bullion exports • Gold to average $2,000 in 2013, CIBC World Markets... • Eurozone crisis will keep driving gold even if inf... • Saxo Bank sees gold breaking record high in Decemb... • Slow economic growth ... has been the primary driv... • "We'll see $2,300 gold by January 2014," Casey Res... • The best month for gold is heading this way • Central banks' expansionary policies will boost Go... • Investors switching from gold ETFs to physical bul... • Five Reasons to Own Gold Bullion • Gold as a Viable Investment Alternative • Gold Bullion equals High Returns • "Gold is primed for a breakout," MarketWatch repor... • Credit Suisse raises gold, silver forecasts for 20... • Central Bank Gold Bullion Buying Hits Record • Gold is money, not a commodity, declares Deutsche ... • $3,000 and $5,000 Gold," Bank of America say • South African Strikes Halt 39% of Nation’s Gold Ou... • India's Gold Bullion Reserve jumps to $26 Billion • Investors should double their Gold Bullion holding... • "Gold Bullion on the verge of an important break-o... • Patience pays as gold looks to move higher • Rising investment demand will support gold, Saxo B... • "Gold Bullion is going to be one of the best asset... • "QE3 has reignited inflation expectations" • Signs of a resurgent gold standard emerging worldw... • Benefits of Vaulting Gold • Gold Bullion - Eternal Standard of Wealth • Central Banks from Russia, Mexico and Turkey bough... • Hong Kong to build Gold Bullion Vaults • $3000 Gold Bullion target • Gold Bullion move easily above $2,000 • Rothschild Wealth Management exec sees Gold Bullio... • Hong Kong gold exports to China rise 12% • Gold is the "Safe-Haven" • Vaulted Gold Bullion • Gold Bullion as an Investment Opportunity • Do Gold Bullion have the same Value as Money? • The International Monetary Fund is buying Gold Bul... • Positive Forecast on Gold Bullion • New Report suggests scarcity of Gold Bullion • China buying Gold Mines worldwide • World's biggest hedge fund still bullish on Gold B... • Central Banks lease Gold Bullion • What Factors Affect the Price of Gold Bullion? • Gold Bullion has good Long Term Support • This Move In Gold Bullion & Silver Will Look Spect...

• Gold rallies to highest price of 2012 • BlackRock exec predicts $2,400 gold by next summer... • Gold is money, not a commodity, declares Deutsche ... • Signs of Gold Standard continue to emerge in China... • PIMCO analysts call Gold Bullion a "compelling inf... • Investing in Physical Gold • Vaulted Gold Bullion as an Investment • Gold Bullion Shortages coming soon ! • Return to Gold Standard? Why Price Would Hit $10,0... • PIMCO fund manager buying gold bullion stake • First Asset Management Targets $2100 Gold Bullion • Gold Bullion continues to be a great Investment ► September (26)

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