It seems extremely unlikely that gold doesn't trade $600 an ounce in the spot market at some time either today or this week. |
Of course, gold can go higher on investment and speculative demand, but there seems no clear motivation for new money to be committed to gold at this time. |
People have realized that the dollar is important for gold but it's not the only factor and you cannot slavishly trade gold just simply because of what's happening to the dollar. |
Platinum has been much more resilient than we expected, |
Silver has moved to the fore following the ETF news of the past week and the metal looks set to trade above $10/oz in the near term. |
Silver is benefiting from pre-positioning ahead of the expected launch of an exchange-traded fund in silver. |
Silver's recent rally appears to have been driven by intensifying speculation that the proposed ETF will soon gain approval from the SEC, although we have seen no indications on the possible timing. |
The level at which physical demand emerges to support the metal will then form a base for gold to make fresh gains. |
The outlook for most of the major gold mining companies is for static to lower production for 2006. With the new project pipeline in gold relatively empty and few major discoveries of gold made in the past decade, we do not expect this picture to change. |
The release of the COTR report tonight is likely to be the final piece of information we need to decide to sell gold, |
The risk remains that the rand will be at the higher end of people's forecasts. |
We believe that all precious metals are trading above fundamentally justified fair value, but the weight of investor, speculator and commodity-index buying has demonstrated that this does not stop metals trading ever-higher. |
We believe that gold is attempting to find a range with the recent extremes of $535 and $555 likely to confine the metal for a while. |
We believe that investors are likely to interpret this ... as being positive for the gold market as it will raise speculation that China will increase its gold holdings. |
We believe that new-year allocations towards commodities will keep platinum and palladium firm in the near term and see platinum at $1,100/oz and palladium at $300/oz over one month, although we suspect that profit taking will set in at some stage and see both metals lower to $1,050/oz and $270/oz in three months. |