Malaysia Gold Investment

Gold is back above $1,200; the correction seems to have run its course. Gold gravitated towards $1,200 yesterday, a point at which a large amount of option strikes expired (yesterday). With the break above $1,200, gold now could move higher. I believe that dips should be bought. Based on FX report, view that the euro will continue to depreciate against the dollar, they also believe that gold in euro terms will outperform gold in dollar terms. The strong performance has been mainly due to a flight to safety, sparked by mounting concerns over the Euro-zone debt crisis, and recently exacerbated by geopolitical tensions in Korea. The combination of factors has seen investors shift money out of equities and riskier assets, towards the safe havens of gold and certain government bonds. Gold support is at $1,192 and $1,175, resistance at $1,219 and $1,129.

Gold remains within $1,170 – $1,190; we expect this range to hold. However, we have been looking for a retracement in gold from its all-time highs, and now believe that the retracement has largely run its course. The strength in gold demand on approach of $1,170 is a positive sign. With gold above $1,200, physical buying interest had dried up. But we are once again witnessing some buying interest and re-stocking out of Asia. The buying interest in the physical market is not great yet, but could increase should gold fall further. We would view a dip towards $1,170 as a buying opportunity. The futures market remains supportive of gold. COMEX gold has seen the net long non-commercial position decline to 32.9% of open interest, down from 33.3% the previous week. Current speculative length is below the average of 36% over the past 12 months. Looking at the futures market, gold is not overbought yet. Gold support is at $1,171 and $1,158. Resistance is at $1,193 and $1,201.

Gold remains well supported. Risk aversion remains high. This is clear from the jump in US and European equity market volatility on Friday. Apart from the rise in sovereign credit risk in especially Europe over the past few weeks, US Libor is also rising, indicating increased pressure on money markets. The rise in US Libor is not substantial yet, but worth keeping an eye on (US 1month Libor ticked up from 0.26% at the end of April to 0.34% last week). Should the spread between Libor and the Fed funds rate increase substantially, the dollar is likely to be the main beneficiary. As long as money markets don’t seize up in the same way as in late 2008, gold should remain very well supported.

Although US equities have recovered most of the ground lost in yesterday afternoon’s rout, the sudden drop of more than 5% in the S&P index (in just a few minutes) was enough to see gold bounce above $1,200. We had thought gold would find strong resistance above $1,190 — but markets were in a panic after equities’ plunge. $1,200 now provides support to gold, as risk aversion remains entrenched in financial markets. However, we remain mindful that scrap continues to come to the market. The moves in US 10y government bonds yields are large for this very liquid market. The 10y yield has dropped from 3.80% at the start of last week, to 3.40% this morning (after falling briefly in chaos to 3.26% yesterday). These lower yields indicate three things: Firstly, the market is very risk-averse. Secondly, the dollar should still find support. Thirdly, higher-beta commodities, which at this stage include all metals and energy except gold, could struggle to rally. (Risk aversion has been fueling...

Base on the chart Malaysia gold price already hits this year bottom and any fear grow in share market will result pushing gold price move higher. Ever year, gold price may rally during 2H of the year so now may is a good time to keep gold better that keep share.