Muskie Man: Nothing is wrong with KGFC it is just the junior market and resource stocks in general.The price of gold isn't helping.the following is about the price of gold.
Gold slide not over yet, experts
warn
By PAUL BAGNELL
Mining Reporter The Financial Post
Investors should expect further declines in the price of gold, experts warned
yesterday, after a three-day free fall was halted by a modest rally.
Gold climbed by US$2.10 in New York, to close at US$320.20 an ounce,
while the share prices of several gold producers also staged a modest rebound.
The Toronto Stock Exchange's gold and precious minerals subindex rose
168.19 points, or 2.23%, closing at 7698.08.
The move helped repair some of the damage caused by a three-day slide that
sent the TSE gold index tumbling 9.97%, wiping out about $3.54 billion in
market capitalization.
Yesterday's rally restored about $738
million of that.
But most experts said the negatives in
gold's short-term future outweigh the
positives.
Yesterday's increase in the gold price was
driven mainly by short-sellers covering
their positions and taking profits, gold
traders said.
Most observers believe the dramatic
collapse in the gold price, which began last
Thursday, was largely driven by
short-sellers, who typically borrow gold
and hope the bullion price later falls.
If it does, they can buy gold at the lower price, repay what they owe and keep
the difference.
On Thursday, speculators pounced on news the central bank of Australia had
sold 167 tonnes of gold over the past six months.
Jeff Ralph, a gold trader at Royal Bank of Canada in Toronto, believes some
U.S. and European mutual funds have taken large short positions in gold, and
haven't yet covered.
"I think they are all looking for the US$300 level," Ralph said, predicting the
gold price will continue to wither.
John Ing, president of Maison Placements Inc. in Toronto, also believes gold
will face continued downward pressure.
Victor Flores, a Texas-based analyst with Marleau Lemire Inc. of Montreal,
was another of those foreseeing a dreary summer for gold.
"It's hard to imagine strong support coming for the metal from any quarter at
this point," said Flores.
Martin Murenbeeld, a gold analyst in Victoria, was slightly more optimistic. He
said the gold price has fallen as far as warranted by current market conditions. Jesse Clear Lake is in Friendly Manitoba.Roger |
