The price of gold edged up again on Tuesday, driven by a falling dollar. On the Comex in New York, gold futures for December delivery briefly reached $1,231.10 per troy ounce, the highest price since July 1, reported Bloomberg News.
Equities also had a positive day, with the major indexes up 1 to 2 percent. Risk appetite improved this month, according to a Bank of America/Merrill Lynch survey. Silver futures gained, rising 0.7 percent to $18.615 per troy ounce.
Investors have lost some confidence in the dollar, which lost ground to the euro, the British pound and the Australian dollar.
The Federal Reserve’s actions earlier in the month helped assuage the fears of some investors that deflation would set in, as the central bank committed to keeping its balance sheet stable rather than contracting the monetary supply. For inflationistas, however, the Fed’s actions were a sign that the dollar was on the path to devaluation.
Many institutional and retail investors have turned to gold and other precious metals recently, in a bid to protect their investments against what they perceive as the most immediate danger to the U.S economy: inflation.
Risk Disclosure
This material is conveyed as a solicitation for entering into a derivatives transaction.
This material has been prepared by a Daniels Trading broker who provides research market commentary and trade recommendations as part of his or her solicitation for accounts and solicitation for trades; however, Daniels Trading does not maintain a research department as defined in CFTC Rule 1.71. Daniels Trading, its principals, brokers and employees may trade in derivatives for their own accounts or for the accounts of others. Due to various factors (such as risk tolerance, margin requirements, trading objectives, short term vs. long term strategies, technical vs. fundamental market analysis, and other factors) such trading may result in the initiation or liquidation of positions that are different from or contrary to the opinions and recommendations contained therein.
Past performance is not necessarily indicative of future performance. The risk of loss in trading futures contracts or commodity options can be substantial, and therefore investors should understand the risks involved in taking leveraged positions and must assume responsibility for the risks associated with such investments and for their results.
Trade recommendations and profit/loss calculations may not include commissions and fees. Please consult your broker for details based on your trading arrangement and commission setup.
You should carefully consider whether such trading is suitable for you in light of your circumstances and financial resources. You should read the "risk disclosure" webpage accessed at www.DanielsTrading.com at the bottom of the homepage. Daniels Trading is not affiliated with nor does it endorse any third-party trading system, newsletter or other similar service. Daniels Trading does not guarantee or verify any performance claims made by such systems or service.