Wow ! A must read, gold nugget of an article !

This is a must read article for whoever loves gold and likes to understand the overt and covert gold market dynamics. GFMS is one of the best authorities on gold, and its CEO is quoted as saying...

He added that there’s ‘spectacular demand in India’ with buyers paying $30/oz over spot for 1 kg bars (.995 quality)—in contrast to the more normal $0.50 premium.

What are you waiting for ? Click the title of this post !

Why Goldbugs Are Hopeful ? Click this Gata Link

Gold and Silver markets were "managed" down to lower levels, the gold market manipulation proof is here. But Goldbugs at GATA are hopeful and confident that manipulation will fail, why ? Well, they are hopeful because of India ! That's right ! You should read this, click the title of this post.

I like to look for simple facts that confirm my view of the market. I found out that there are extremely high premiums on physical gold and silver metals delivery in US. And globally the demand and premiums both are high, and there are delays in ready delivery. You can sure be hopeful that any kind of manipulation will fail in this situation.

My Daily Gold Chart

Technical Analysis. Charts. These terms sound glamorous, but are only useful tools if used judiciously in conjunction with fundamentals of the market.

My daily chart above (click for larger image) shows the seasonal August low. Quite unexpectedly lower, but now it does look the low of the summer, and if not, it will be part of the bottoming formation for sure, in my opinion.

While I am writing this spot gold has hit above $842 ! Thanks to tropical storm Gustav, oil is higher, and so is gold.

Listen to This Gold Positive Statement, Very Carefully

What more do you need to hear ? From the second biggest gold stock holder, and probably the highest authority to accept the facts publicly in current environment. Listen carefully...

BERLIN, Aug 22 (Reuters) - Germany's Bundesbank on Friday rejected calls that it should sell some of its gold reserves to help boost the slowing German economy, telling Reuters financial and political uncertainty make the reserves even more important than before...
..."National gold reserves have a confidence and stability-building function for the single currency in a monetary union. This function has become even more important given the geopolitical situation and the risks present in financial market developments."
...The Bundesbank is the world's second-largest holder of gold after the U.S. Federal Reserve, and has sold just 20 tonnes out of total reserves of over 3,000 tonnes in the past five years.These sales were to allow the German finance ministry to mint gold coins, unlike the much more active sales programmes of other central banks which wanted to shift their portfolios from gold to a more diverse array of assets.

Read the full article here.

Important alert on GoldBullion Blog

What is the rest of 2008 going to be like ? And how it will affect the coming 2009 and 2010 ? Just click on the title of this post to read the alert. Forewarned is forearmed.

A stock answer... No stock...

This is just an example of the worldwide phenomenon. Everywhere dealers are saying 'we are out of stock', including US mint. I read in newsreports that bullion dealers in India are also running short of stock. In local market here also '' No Stock" is a stock answer. And there are margins above the cash price quotes. So what does it say ?

Does anything need to be said ?

Still, for further reading A Fabrication Bottleneck or Something More ? Don't miss the long term charts in the article.

Gold from here to.....

Gold here is at crossroads. One idea is that it is normal summer time market correction, quite a bit overdone, but gold will recover from here supported by value buying, physical buying etc. Other opinion is that it has really broken down and next come projections of $550-$600 on wild side to more rational $680-$730. If you do not get confused, you are blessed !



After filtering out the noise from both sides, and taking into consideration the hard facts, I have come to following conclusion :



It is true that the summer downturn is harsher, deeper than expected. Everyone was expecting gold to hold above previous all time high of $850, given the credit crunch and financial market turmoil. But gold always surprises you, doesn't it ? Whether on upside or downside. But is this summer downturn a real downturn ? Beginning of a bear market ? It might look like one but doesn't feel like one. It might look like one technically on charts, but fundamentally you do know it couldn't be happening, right ? Yes, it should not be happening. But, but hard facts are hard facts. Gold is *below* its very important $850 level, and *below* its very very important 60 week moving average of $832 and 65 week moving average of $818. Gold has been above these moving averages for almost last eight years. So where does that leave us ?



If gold does not recover above these numbers $818, $832 and $850 soon enough; at the moment I have no idea what to think. And it might bounce from say $800 or $790 or $772 or even $730.



At least after taking this view you can watch the market with open mind to see which scenario is actually playing out.