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Gold Hasn't Reached "Maximum Pain" Just Yet – Triland Metals

Tuesday March 10, 2015 2:03 PM

Although overall sentiment seems to be bearish for gold, analysts at Triland Metals say there may still be more wiggle room. “We do not believe that we are at the point of maximum pain just yet,” they say Tuesday. “[W]e look to see further weakness in the sector as we approach the impending rate rise in the US,” they add.  However, they note that at the point where the U.S. Federal Reserve decides to raise rates, “the bullish cash may be as strong as ever.” For now, they say there are no technical levels of interest and the market is likely to hit more downside targets, at which point the market will experience short squeezes. “[W]e would expect such rallies to be sold into,” they note. 

By Sarah Benali of Kitco News; sbenali@kitco.com


U.S. Economy to Face Near-Term Slowdown – Nomura

Tuesday March 10, 2015 7:49 AM

Despite a strong U.S. dollar and weak peripheral economies, analysts at Nomura expect a near-term slowdown for the country’s economy. “Inclement weather conditions in the latter half of February and West Coast port disruptions due to the labor disputes will likely weigh on growth in Q1 2015,” they say in a research report. “Furthermore, the recent decline in oil prices has not materially spurred consumer spending but rather has pushed the saving rate higher,” they add. However, despite the short-term pullback, Nomura analysts expect longer term figures to improve. “[A]s these near-term shocks dissipate, we continue to expect the economy to grow near 3% in 2015 before gradually transitioning toward potential GDP (~2%) in 2016 as financial conditions tighten as a result of tighter monetary policy,” they say, adding that they expect job gains to maintain a solid pace and eventually push the unemployment rate down to 5.2% by year end. “With the year-over-year measures of our inflation forecast showing some acceleration in Q3 2015, we believe that the first rate hike will occur in September. After the first rate hike, we continue to expect the FOMC to hike at a pace of 25bp per quarter.”

By Sarah Benali of Kitco News; sbenali@kitco.com


MKS: Fed Rate Hikes With Keep Gold On The Back Foot

Tuesday March 10, 2015 7:49 AM

Although Asian demand is lurking in the marketplace, it doesn’t appear to be strong enough to boost prices out of its current downtrend, says Alex Thorndike, senior precious metals dealer at MKS. In overnight action, he says arbitration on the Shanghai Gold Exchange held premiums between $3 and $5, “which means demand is still out there, despite the technical weakness. The market still generally feels weak however and with the very real likelihood of the Fed hiking rates this year gold will remain on the back-foot. We feel it would be a good opportunity to sell into rallies in the short term looking to take back around trend support of $1145-50.”

By Neils Christensen of Kitco News; nchristensen@kitco.com


INTL FCStone: Only Outright ‘Grexit’ Will Create Safe-Haven Demand For Gold

Tuesday March 10, 2015 7:37 AM

Gold prices have been unable to find any sustainable momentum overnight as it appears to start Tuesday’s North American session in negative territory. Comex April Gold last traded at $1,164.70 an ounce, down $1.80 on the day. Edward Meir, commodity consultant with INTL FCSTone, says he remains negative on gold in the near-term as the U.S. dollar dominates the marketplace. He adds that continued uncertainty in Europe surrounding renewed Greek negotiations might not provide much safe-haven demand for the yellow metal. “The Greek issue is a potentially bullish catalyst, but short of an outright default or a ‘Grexit,’ we don’t think the gold complex will react much to the daily ups and downs in the negotiations, as we saw the last time around,” he says.

By Neils Christensen of Kitco News; nchristensen@kitco.com



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