Coming to the year 2010, the global economy would soon be aired with good news high interest rates, and that they shall continue in the run, but then, one is not supposed to expect some wavering of gold price in 2010. With respect to many evaluations, gold prices are most likely to retain its security, since investors at large have been working over this yellow metal in terms of a shield against inflation. Moreover, the assumption for the year 2010 for gold price has been around $900, and that is almost a 13% rise as well.
Dollar and gold prices move in the opposite direction, whereas gold and euro move together. So, if euro is in crisis, we will see losses for gold in the future. Over the last years, there has been correlation of +0.52 among gold and euro. It is expected that this correlation may even rise further.
Quite a large population has been affiliated with the stability of gold, and one of the major factors has been inflation. Quite a large number of people have somehow lost faith in money particular US dollar, and therefore, the outcome has always been some financial fluctuation. Quite a high percentage of people have been making strenuous efforts to get hold of some commodity that would be a safe hedge against inflation, and that secure product happens to be gold.
Determination of gold value includes many factors in which inflation is the main cause. There were big financial crisis in 2009 and 2008, and that is the reason that people now do not trust in paper money. Most of the participants want a trustful substitute of the paper money, which is gold, and it is surely taking the lead on the leading currencies of the world.
According to seasonal expert, the strongest seasonal period for gold is October to March. There is a hope that market conditions will improve with the passage of time, but for that, we need supply discipline, and sustained and positive demand trend. As gold and silver prices are hanging on the decision cliff, so is the US dollar, which keeps on fluctuating up and down.
On the other hand, there are people who are of the opinion that gold prices will go up. The reason is that almost all financial markets are driven by expectations of the events that may take in the future, not via event themselves. Some expectations like event of September 2009 are reaching to uncontrollable level. To make our life easier, it is a good idea to invest with primary trend. Gold primary trend is up for now. Some of the expectations are high inflation and decrease in US $. Expected is the continuing growth in China; with Yuan on the rise.
In addition, the Chinese government might just continue the major demand of gold as the European countries have been asking for the return of tangible gold in large quantity. This might put the New York gold exchange under some trouble, but overall, the gold price shall remain safe, and sound.
Due to a lot of fluctuation in prices of gold, it is not wise to invest in gold now. 2000-2002 was considered as best investing period as the prices was very low in that time. You would only make profits by taking risks on prices of gold.
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categories: bank,money,finance,business,investment
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