The Ups & Downs Continue for Precious Metals

Another Dip below $800 for Gold

Sell-off's this morning again brought gold down below $800. At the time of this posting spot gold was at $793. Platinum also saw some adjustment dropping to about $1423 at the time of this posting, with palladium still hovering just a bit below $370. Silver slipped back below it's surge to $15 from yesterday and rests near $14.65 at present.

Palladiums weakness is due to a very legitimate collision of less demand and a reasonable expectation of production. Platinum, on the other hand seems to be reacting to tighter shortfall figures than speculators had anticipated for the fourth quarter. Gold futures are down on a firming US dollar and softening price for crude oil. These are the types of short-term reactions I had mentioned in other postings. Most analysts expect these sorts of ups and downs to continue through the month of November and probably through the end of this calendar year.

Two different camps seem to be emerging regard the long-term viability of a bullish gold market. Some are expecting gold to shift down to the $720 level after February when demand for gold in India slacks off as the festival season comes to a close. Others are looking longer term and anticipate that gold supply will get even tighter in the next few years, as mining becomes a more costly and difficult proposition. These folks are looking at both the rise in demand over the last few years and reports from major gold production firms which indicate a faster fall in gold supply is coming.

With these possibilities in mind, major industry is looking for ways to keep the precious metals needed for manufacturing flowing. Japan, for instance, is looking to team up with Botswana and South Africa to use satellite technologies to reach better, more productive veins. When there is purposeful demand, not just speculation, there will always be those willing to find a way.