For the first time we can see a mess in gold price. In the last 30 days we watched gold price declined by an average of 5%. Gold price in the Spot market at 11:41 NY Time recorded a decline by 0.85% to reach the level of $1376.60 USD/ Ounce of gold. We watch a fluctuate in gold price but all of it in the red area ( losing level ).
We can say that gold price collapse, faster than expected. But why gold price collapse? it is an important question, you had to ask.
Japan caused a global fears
Japan is one of the leading economic country. When we watch a decline in its stock market by more than 20% in the last month. It is a bad indicator for the economical situation of Japan. Fears today push the investors to sell in the stock market and head to the currency exchange, especially the U.S Dollar. The flow of the Japanese market today was different from usual in which we used to watch ahead to Gold market, in case of the lose of the stock market. But japanese investors for the first time head to the currency exchange, because they see that it is more stable even Gold, the issue which lead the global decline in the early trading session today.
USA play with the gold market
We watched unexpected data from USA today. Starting by the retail sale, which jumped by o.6% while it was expected to rise by 0.3% only. The issue which supports the U.S Stock. But there is another issue support the U.S stock market today, which was the unemployment ( Labor US weekly data) which fell by 12, 000 in one week. The number of unemployment fell to its lowest level since May. U.S Data stated that insurance benefits fell 12,000 to 334,000, for sure it was a great push for the U.S Stock market added more pressure over gold price and cause its decline. The U.S Dollar which declined today after the morning rise in front of the Yen, was due to the gaining profit or technical buying from Japanese investors to over come their lose. USA today plays by gold price and cause its decline, by its strong data.
There is another problem for gold price. The trading level of gold price keeps in the narrow area, but it had been changed temporary or for the short term trading. To be between the level of $1370 and 1390 USD/ Ounce of gold.
We watched the flow of money to the U.S Stock which cause a decline in the U.S dollar value. There was another flow toward the U.S Stock not toward gold market. The flow today was from The European market after the fall of the Euro stocks. Investors in Euro area headed toward the new black horse, The U.S stock market.
My only tip for gold investors, who trade for the short time keep away from gold market, there is another wave of fluctuate expected. For big investors of gold it is the time to buy gold as a long term investment.