August 8, 2011 – – Monday Opening Prices see Gold Rocketing Upward: Gold jumped to new nominal record levels, rising above $1,700 as investors piled in following the S&P downgrade of U.S. debt. After rising $46 on Friday, gold rose $59.20 an ounce in early trading Monday.
The yellow metal hit a new record of $1,714 an ounce in late Asian trading, although it fell back in Europe amid buying by the European Central Bank of Spanish and Italian bonds.
Gold prices have been fueled by increasing fears of sovereign debt defaults and expectations of further monetary easing in the US. Meanwhile, a further boost has been seen from investors deterred from putting funds into other haven favorites, the Swiss franc and Japanese yen, after recent government interventions to weaken the currencies.
Silver was also helped by haven buying, rising 4 per cent to $39.85 an ounce, but base metals (tin, copper, etc.) were hit by increased risk aversion among investors.
West Texas Intermediate (WTI) Crude Oil was trading lower, with prices down $3.20 a barrel to $83.68.
Look for an initial “bloodbath” in U.S. stocks, as traders digest the U.S. debt downgrade and continuing signs of a double-dip recession into Great Depression II (in 2012 & 2013). The major stock indices (DJIA, NASDAQ and the S&P 500) should start recovering in the late morning. The afternoon high should be around 3:30PM EST with prices turning lower into the 4:00PM close. Presume extreme volatility, with a range of over 600 points on the DJIA.
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