Precious metals market review for 28.07.09
By admin at 29 July, 2009, 6:11 pm
Dynamics
On Tuesday 28 July, quotes for precious metals fell under renewed pressure from the dollar. The negative background is also set up a hearing before the Commission on urgent exchange trade on the issue of restrictions for holders of energy and agricultural contracts.
As a result of trades on the COMEX, division New York commodity exchange (NYMEX), quotes on gold fell by 14.60 to 941.70 dollars per troy ounce, the price of silver fell 25 cents to 13.74 dollars per oz.
Causes
On Tuesday 28 July at the auction market for precious metals retreated from highs reached against the backdrop of growing and the dollar and falling stock quotations on the stock continued its downward movement sites. It should be noted that at this time, it was observed enhancement of fixation of return on long positions of market participants, which only increases the pressure on metals.
From the news it may be noted that the Russian Subsoil users in January-June 2009 increased by 17,7% gold as compared with the same period a year earlier. Manufacture of jewelry and diamonds in Russia for six months decreased to 39.1% and amounted to 317 thousand units. Russia, in June 2009, gold production decreased by 8,5% due to the alluvial deposits. June to ensure the failure of small businesses - owners of alluvial deposits, which begins production in the warm period. At 380 small zolotodobytchikov production accounts for 29% of the metal in Russia (about 50 tons per year). If the summer is usually the extraction of gold rising more than 50% in June to May the increase was only 40.5%. Companies from the crisis have not been able to attract loans and eventually either not begun production, or decreased it. Gold mining in 2008, has 421 company, is at 40 less than a year earlier. The process of reduction continues, primarily through small, who are developing alluvial deposits with a volume production to 100 kg of gold.
What to expect?
Many analysts agree that the dollar in the coming session, will meet serious resistance, and it is unlikely that its current growth will continue much further. Given the significant drop in quotations of precious metals can be said that the technical levels look quite attractive for the discovery of new long positions. Moreover, August is nearing, when the first purchase physical metal for the various festivals in India.
What is fear?
However, no release in sight, and fall on the neighboring markets, which may increase due to the new portion of negative economic statistics, which in turn can become a catalyst for the fall of the market of precious metals. There is also a chance for further gains on fixing long positions.
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