INTERNATIONAL. The price of physical gold crept higher early Friday, recovering half of this week's 5% loss to near 6-month lows as the euro currency rallied from 12-month lows and world stock markets held flat.
The last London Gold Fix of 2011 came in at US$1,574.50 per ounce – some 11.6% higher from the end of 2010, and recording gold's 11th year of consecutive gains.
US crude oil neared year-end just shy of US$100 per barrel, also 11% up on 2010.
The MSCI index of world stock markets has lost 8% in 2011.
Silver bullion lost almost 9% against the US Dollar this year, recording near all-time highs in April just shy of US$50 per ounce but retreating Thursday as low as US$26.25.
"People close their profitable positions to cash out before the year-end, " says Nick Trevethan, ANZ Bank's senior commodity strategist.
"Gold is still up on the year and there are relatively few markets moving in the positive territory,"
"Base metals have not fared well this year, with falls recorded across the complex," notes Marc Ground at Standard Bank, listing 2011 losses of 18.6% in aluminum, 20.7% in copper and 28.7% in tin.
"Gold has done its job this year of protecting investors," Bloomberg quotes Michael Cuggino at the US$15 billion Permanent Portfolio Solutions in San Francisco.
"Some people will get out of gold, but the longer-term investors will remain."
On a technical analysis of chart patterns, says Russell Browne at Scotia Mocatta in New York, "The longer-term uptrend off the October 2008 low remains intact, but was breached on an intraday basis [on Thursday] and is likely to be re-tested and breached in the short term."
"Gold is going to go higher, but it's not going to go in a straight line," says Martin Murenbeeld at DundeeWealth in Toronto.
"Gold has given positive returns, but it doesn't necessarily do it in the way that gives comfort, and that makes people nervous."
Note. Formerly City correspondent for The Daily Reckoning in London and head of editorial at the UK's leading financial advisory for private investors, Adrian Ash is head of research at BullionVault – winner of the Queen's Award for Enterprise Innovation, 2009 and now backed by the World Gold Council market-development and research body – where you can buy gold today vaulted in Zurich on US$3 spreads and 0.8% dealing fees.
For more information, please visit BullionVault.
(c) BullionVault 2011
Please Note: This article is to inform your thinking, not lead it. Only you can decide the best place for your money, and any decision you make will put your money at risk. Information or data included here may have already been overtaken by events – and must be verified elsewhere – should you choose to act on it.