Investment Opportunity: Gold Prices Falls To Lowest Level In Two Weeks

Gold has always been considered a safe investment. However looking at the recent drop in the gold prices, It almost appears that the luster of the gold may be dulling just a bit as the price of gold fell closer to the $1,100 per ounce mark. Is this the beginning of a downturn in the price of gold? Is gold still a very safe investment?

Gold is falling despite overall stock market growth

Jobless claims fell by another 6,000 last week, and that seems to have had an effect on the price of gold, pushing it down near the $1,100 per ounce price range. The two dollar drop towards $1,100 is the lowest the price of gold has been for the past two weeks. This drop is unexpected considering that last week, gold grew in price by $20 per ounce. This week, that $20 gain has already been lost as gold has fallen $27 in price. In the past few weeks, there has been a great deal of liquidity in the gold market with over one million ounces being sold during this time frame.

  • Spot gold fell to a low of $1,102.85, which is its lowest level since February 25.
  • U.S. gold futures for April were down 1.3 percent to $14.20 this week, with $1,108.10 an ounce in heavy trading.

Platinum Prices Rises

While gold prices have fallen slightly, platinum prices have actually gone up by more than one percent to reach their strongest price level in the past seven weeks. The reason for this is due to Japanese buying heavily in platinum on the Asian markets. As well, South Africa, the world’s largest platinum exporter, has announced that the country will not experience the same delays in mine production as was seen last year. Last year, there was not enough power to run the mines and the exports of platinum fell drastically. South Africa has also stated that they do not expect any blackouts during the World Cup of Soccer this year, which should keep the platinum mines running and that is good news for the market.

Crude Oil Prices Fall

Just as with gold, crude oil prices for April has fallen by 34 cents down to $81.75 per barrel. The reason for this drop was because of the strengthening of the dollar against the Euro, which made commodities much more attractive to investors. The U.S. dollar traded at $1.3621 against the Euro, which was an improvement over the $1.3657 that it traded at the day before.

Gold prices have fallen slightly but they are still a great investment that should keep going up for some time now. Gold prices are higher than they have ever been before and it is going to take a lot to hurt that market sector. Platinum prices are also going to be better this year thanks to the higher production coming out of South Africa. As for crude oil, it should go up in price as summer gets here, but expect the crude oil prices to stay between $80 and $95 throughout the next few months.

Further Reading:

Is Gold a safe investment?

Should I keep investing in Dollars

Related posts:

Comments: 8

Thank for the feed back

Elma Kruskie
01 June 2010
Reply

Hi friends, can you guys suggest me that which online stock brokerage firm I should choose.

    pgupta
    03 June 2010
    Reply

    Depends on what you are looking for. Zecco is a good bargain for beginners. Click here for details

    pgupta
    03 June 2010
    Reply

    Depends on what you are looking for. Zecco is a good bargain for beginners. Click here for details

vegas
13 May 2010
Reply

I’d like to include stock volatility as a selection criteria as well as fo r instance beta. Is there somewhere I can get a list of FTSE 100 stocks and their volatilities, for eg 1 yaer? If I work it out for myself it will take me all week. Is there a website with this available?

    pgupta
    17 May 2010
    Reply

    You probably should look at Google Stock Screener. That should get you started towards what you are trying to find.

Tradesmart
09 May 2010
Reply

I currently use Etrade right now, but at $12.99/trade I think I’m getting ripped off. Seems like the popular opinion on here is that Zecco is the best option, but I have two questions If I currently use Etrade, how do I “transfer” those stocks that I own right now with Etrade over to Zecco?

    pgupta
    09 May 2010
    Reply

    Hey Tradesmart,

    First of all etrade has reduced their fee right now. You will now be billed 9.99 instead of 12.99

    With regards to your question regarding etrade vs. Zecco, IMHO you need both accounts. Etrade is good for active traders, penny stock traders. However, Zecco is for cheap stock trading, they are actually famous for their 10 free monthly trades. If you want more info regarding Etrade, please visit the review page:

    http://www.comparebroker.com/etrade-reviews-online-stock-brokers-review

    Zecco info is available at:

    http://www.comparebroker.com/zecco-reviews-online-stock-brokers-review

    Transferring the account is actually really easy. All the brokerage firms have a transfer Stocks / Securities from other brokerage firm option. Just use that, you will be billed a certain amount by the brokerage firm. Some receiving firms will refund that charge to you.

    Hope that helps. If you have further questions, please feel free to drop me a line.

    Thanks.

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