Wow -what happend to get $7 jump in price of gold?

northcoin

After flirting up and down close to the $340 range, gold jumps to almost $350 in a single day. What happened?

Steve27

LONDON, May 8 (Reuters) - Gold surged to its highest level in nearly two months on Thursday buoyed
by a weaker dollar, which fell to a four-year low against the euro.

eagle7

The reason the dollar is so weak is our massive debt load now that we spent about 40 billion on the deal in Iraq. I dont think the French or anyone else will help us out with it either.

Steve27

I think the oil will help us out (just don't tell Iraq).

jeffnpcb

Euro is down to .869. Multiply the price $348. X .869= 302.40! Last year before the Euro was gaining on the dollar, this indeed would have been a high price. At $302.40 American was early last year. As long as the dollar is dropping against the Euro, gold is not a good deal. Collectables are even going to cost more.
When the American dollar climbs back up against the Euro, our price for gold will drop!

roadrunner

As the US dollar continues to fall due to foreign countries cashing out of the weakening dollar, expect gold to continue to rise in reply.
The dollar is in a long term bear market. It just came out of a long term bull market. Forget the daily and weekly changes in the gold price. The overall long term trend is decidedly up as this gold bear market appears to be relatively young. You may very well see a strong correction from where it is now in the next few days/weeks.
Day to day and week to week swings will be the norm....just like on Wallstreet.

The world's finances stink and gold has just been responding to that for the past 2 years. Wait until the stock market checks in with its 4th straight annual loss.

roadrunner

AbesNeighbor

Weaker dollar...world deflation...Gold is the safe harbor for many.

paigowjohnny

And can just as easily go down $10 tomorrow.....

rd5425

Its going back up!!!!!!!!!

coinkat

Perhaps Gold hit a short term bottom in the $320 range. It that proves to be correct, maybe the short term bottom has been defined. Mostlikey gold will stay in a trading range... the $320 range may be the bottom and hopefully the recent high of $380 will be tested again this year. The trading range on the up side may be $400, but not much more.

There are somethings that are worthy of comment:

1. Interest rates on CDs and T-Bills for investors are not attractive.

2. Rates haven't been this low in 40 years. The actual cost of owning gold has never been cheaper because alternative investments are not performing well.

3. The return on gold could be 10-15% which in this environment is not too bad.

4. Gold stocks are probably the better play because they were butchered badly and are trading for about .15 on the dollar from their 1995 levels.

5. Don't get caught in the hype about the usual view of gold being a hedge and the doomsday saftey net because that view has been consistently wrong since 1974.

6. Gold is a commodity and will go up and down just like other commodities.