The gold price is set in the Comex futures exchange by the trading of futures contracts and not the amount of gold traded in Dubai, India or anywhere else.
Therefore, if you want to read the future of gold prices, the Comex is the place to address your thoughts. Typically it is a rather bewildering place for amateur speculators who generally get their positions wrong, while professional commercial investors control the market.
But over the summer a clear pattern has emerged, and one that has almost always come before a very much higher price for gold and silver.
Basically, professional investors have all switched to the long side of the market, including the most powerful JP Morgan. Meanwhile, smaller speculators have been lured into record short positions, thinking that gold has had it and Wall Street is the only game in town.
All the commercial longs have to do now is tip the market into a mild upturn and all these short positions will have to cover. That is to say buy gold contracts to close off their losing short positions before they get into even more financial trouble.
This should lead to a sudden flood of buyers that will drive precious metal prices sharply higher, triggering phase one of a new bull phase. The long commercial Comex players will win yet again, along with anybody who’s been bright enough to see what is coming.
This phase of a gold bull market takes around three to four months to play out before the wider financial markets are convinced it is happening and then all pile in for phases two and three.
The final phase of a commodities bull market - like the one that started in gold in 2000 is always a price spike, not something we have seen yet.
The collapse of cryptocurrencies last week could be the driver that opens the way for substantial gold price rises as cryptos have distracted speculators from precious metals. So too the recent emerging markets crash, and a growing correction in major stock markets.
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Read more from Peter Cooper:
Time to take profits on US tech stock double-bubble
Why gold will remain one of the safest ports during the turbulent times ahead
Time to Trump audit your portfolio and eliminate any bubble trouble
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September is usually a much better month for gold with the metal up an average of two per cent since it became freely traded in the early 70s, although it was down 2 per cent in September last year.
The gold price plunged alarmingly late in August, hitting a low of $1,172 an ounce. But this now increasingly looks like the bottom of the dive from its April high of $1,375.
One worry among the smaller speculators is whether this price plunge might get worse before gold’s next advance.
That happened in the last global financial crash when gold sank with all the other ships, albeit it was the best performing major asset class, apart from silver, after that crash.
However, this time is somewhat different. In the past the Federal Reserve has responded to stock market crashes by slashing interest rates by up to 5 per cent.
With interest rates currently still very low, the Fed cannot do this without taking them into negative territory - something that has never happened before in the US but has in the EU.
Anything even close to negative US real interest rates (that is the base rate minus inflation) would be hugely positive for gold as the metal does not pay interest, but then again cannot deduct negative interest either.
Indeed, this is unlikely to be like 2008-9 for gold prices - when prices slumped deeply with the stock market - because gold is coming off a near 50 per cent price correction from 2011-15, and not falling from a record high as it was back then.
Instead, turn your thoughts to January and February 2016 when the Dow lost 2,000 points and gold shot up $200.
Even if there is no US stock market correction, then the Trump administration is clearly putting pressure on the Fed to stop raising interest rates and strengthening the dollar further before the upcoming mid-term elections. That would also be good for gold.
Likewise the growing emerging market currency crisis - a direct effect of the dollar’s rising value - could force the Fed to put its rate hikes on hold, boosting gold.
Also, consider the established link between the price of oil and gold. Oil prices have bounced back from the lows of four years ago and in the past year the oil revenues of the Gulf states have grown by around 25 per cent.
But the surging oil price has not yet brought a commensurate increase in the gold price as it almost always has in the past.
This market anomaly ought to be about to correct itself, particularly as the upward pressure on oil prices is unabated with upcoming supply issues from the renewed US sanctions on Iran, not to mention problems affecting oil’s so-called ‘fragile five’: Venezuela, Nigeria, Iraq, Libya and Algeria. US shale oil production has also peaked and entered a steep decline.
At the same time central banks continue to buy gold. Russia has dumped the lion’s share of its US treasuries this year and continued to buy bullion. Gold buying through the Shanghai Gold Exchange is up 6 per cent to 1,366 tonnes year-to-date.
So apart from Comex price fixing, why did the gold price slump from $1,375 down to $1,172 from April through to late August this year?
Blame the 6.5 per cent rise in the US dollar index over those months. Gold is priced in US dollars and depreciates like any other currency as the dollar rises.
Many currency analysts now think the dollar’s rally is overdone and overdue for a correction. Again the technical chartists can point to the end of a trend, and some fundamentalists say interest rate rises are almost done or actually over, as does the yield on 10-year treasury bonds.
Lastly don’t forget the normal seasonal pattern of gold. Indian religious festivals always tend to give prices a boost in the autumn months. In fact, Indian gold imports more than doubled in August compared with the same month last year to stock up at low prices.
Gold exchange traded products like GLD or SGOL are the easiest and cheapest way to invest in gold. Buying the physical stuff down the gold souk is a storage and insurance headache, and the buy-to-sell spread is higher.
Precious metal investors often leverage up on rising gold prices by buying silver instead. The tighter supply of silver than gold means its price increases faster when precious metals rally.
Silver ETFs like SLV or PSLV, that can be bought through any online trading platform, are even more convenient than their gold equivalents as silver is only worth around one eightieth of the price of gold and investing a large amount creates a weighty amount of the physical metal.
Peter Cooper has been writing about finance in the Gulf for more than two decades
Benefits of first-time home buyers' scheme
- Priority access to new homes from participating developers
- Discounts on sales price of off-plan units
- Flexible payment plans from developers
- Mortgages with better interest rates, faster approval times and reduced fees
- DLD registration fee can be paid through banks or credit cards at zero interest rates
The specs
Engine: 1.5-litre turbo
Power: 181hp
Torque: 230Nm
Transmission: 6-speed automatic
Starting price: Dh79,000
On sale: Now
UAE currency: the story behind the money in your pockets
The Little Things
Directed by: John Lee Hancock
Starring: Denzel Washington, Rami Malek, Jared Leto
Four stars
UAE currency: the story behind the money in your pockets
Sole survivors
- Cecelia Crocker was on board Northwest Airlines Flight 255 in 1987 when it crashed in Detroit, killing 154 people, including her parents and brother. The plane had hit a light pole on take off
- George Lamson Jr, from Minnesota, was on a Galaxy Airlines flight that crashed in Reno in 1985, killing 68 people. His entire seat was launched out of the plane
- Bahia Bakari, then 12, survived when a Yemenia Airways flight crashed near the Comoros in 2009, killing 152. She was found clinging to wreckage after floating in the ocean for 13 hours.
- Jim Polehinke was the co-pilot and sole survivor of a 2006 Comair flight that crashed in Lexington, Kentucky, killing 49.
FIGHT CARD
Sara El Bakkali v Anisha Kadka (Lightweight, female)
Mohammed Adil Al Debi v Moaz Abdelgawad (Bantamweight)
Amir Boureslan v Mahmoud Zanouny (Welterweight)
Abrorbek Madaminbekov v Mohammed Al Katheeri (Featherweight)
Ibrahem Bilal v Emad Arafa (Super featherweight)
Ahmed Abdolaziz v Imad Essassi (Middleweight)
Milena Martinou v Ilham Bourakkadi (Bantamweight, female)
Noureddine El Agouti v Mohamed Mardi (Welterweight)
Nabil Ouach v Ymad Atrous (Middleweight)
Nouredin Samir v Zainalabid Dadachev (Lightweight)
Marlon Ribeiro v Mehdi Oubahammou (Welterweight)
Brad Stanton v Mohamed El Boukhari (Super welterweight
'Dark Waters'
Directed by: Todd Haynes
Starring: Mark Ruffalo, Anne Hathaway, William Jackson Harper
Rating: ****
How to help
Send “thenational” to the following numbers or call the hotline on: 0502955999
2289 – Dh10
2252 – Dh 50
6025 – Dh20
6027 – Dh 100
6026 – Dh 200
2.0
Director: S Shankar
Producer: Lyca Productions; presented by Dharma Films
Cast: Rajnikanth, Akshay Kumar, Amy Jackson, Sudhanshu Pandey
Rating: 3.5/5 stars
AndhaDhun
Director: Sriram Raghavan
Producer: Matchbox Pictures, Viacom18
Cast: Ayushmann Khurrana, Tabu, Radhika Apte, Anil Dhawan
Rating: 3.5/5
Scores
Scotland 54-17 Fiji
England 15-16 New Zealand
The biog
Age: 32
Qualifications: Diploma in engineering from TSI Technical Institute, bachelor’s degree in accounting from Dubai’s Al Ghurair University, master’s degree in human resources from Abu Dhabi University, currently third years PHD in strategy of human resources.
Favourite mountain range: The Himalayas
Favourite experience: Two months trekking in Alaska
SHAITTAN
%3Cp%3E%3Cstrong%3EDirector%3A%20%3C%2Fstrong%3EVikas%20Bahl%3Cbr%3E%3Cstrong%3EStarring%3A%20%3C%2Fstrong%3EAjay%20Devgn%2C%20R.%20Madhavan%2C%20Jyothika%2C%20Janaki%20Bodiwala%3Cbr%3E%3Cstrong%3ERating%3A%20%3C%2Fstrong%3E3%2F5%3C%2Fp%3E%0A
Five ways to get fit like Craig David (we tried for seven but ran out of time)
Start the week as you mean to go on. So get your training on strong on a Monday.
Train hard, but don’t take it all so seriously that it gets to the point where you’re not having fun and enjoying your friends and your family and going out for nice meals and doing that stuff.
Think about what you’re training or eating a certain way for — don’t, for example, get a six-pack to impress somebody else or lose weight to conform to society’s norms. It’s all nonsense.
Get your priorities right.
And last but not least, you should always, always chill on Sundays.
Global state-owned investor ranking by size
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China
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UAE
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4.
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Japan
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5
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Norway
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Canada
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Singapore
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South Korea
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'The Last Days of Ptolemy Grey'
Rating: 3/5
Directors: Ramin Bahrani, Debbie Allen, Hanelle Culpepper, Guillermo Navarro
Writers: Walter Mosley
Stars: Samuel L Jackson, Dominique Fishback, Walton Goggins
UPI facts
More than 2.2 million Indian tourists arrived in UAE in 2023
More than 3.5 million Indians reside in UAE
Indian tourists can make purchases in UAE using rupee accounts in India through QR-code-based UPI real-time payment systems
Indian residents in UAE can use their non-resident NRO and NRE accounts held in Indian banks linked to a UAE mobile number for UPI transactions
From exhibitions to the battlefield
In 2016, the Shaded Dome was awarded with the 'De Vernufteling' people's choice award, an annual prize by the Dutch Association of Consulting Engineers and the Royal Netherlands Society of Engineers for the most innovative project by a Dutch engineering firm.
It was assigned by the Dutch Ministry of Defence to modify the Shaded Dome to make it suitable for ballistic protection. Royal HaskoningDHV, one of the companies which designed the dome, is an independent international engineering and project management consultancy, leading the way in sustainable development and innovation.
It is driving positive change through innovation and technology, helping use resources more efficiently.
It aims to minimise the impact on the environment by leading by example in its projects in sustainable development and innovation, to become part of the solution to a more sustainable society now and into the future.
Specs
Engine: Dual-motor all-wheel-drive electric
Range: Up to 610km
Power: 905hp
Torque: 985Nm
Price: From Dh439,000
Available: Now
The specs
Engine: 4.0-litre flat-six
Torque: 450Nm at 6,100rpm
Transmission: 7-speed PDK auto or 6-speed manual
Fuel economy, combined: 13.8L/100km
On sale: Available to order now
Key facilities
- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
- 400m Olympic running track
- NBA-spec basketball court with auditorium
- 600-seat auditorium
- Spaces for historical and cultural exploration
- An elevated football field that doubles as a helipad
- Specialist robotics and science laboratories
- AR and VR-enabled learning centres
- Disruption Lab and Research Centre for developing entrepreneurial skills
25%20Days%20to%20Aden
%3Cp%3EAuthor%3A%20Michael%20Knights%3C%2Fp%3E%0A%3Cp%3EPages%3A%20256%3C%2Fp%3E%0A%3Cp%3EAvailable%3A%20January%2026%3C%2Fp%3E%0A
UAE currency: the story behind the money in your pockets
Mountain%20Boy
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Russia's Muslim Heartlands
Dominic Rubin, Oxford
Dubai World Cup Carnival Thursday race card
6.30pm: Dubai Millennium Stakes Group Three US$200,000 (Turf) 2,000m
7.05pm: Handicap $135,000 (T) 1,600m
7.40pm: UAE Oaks Group Three $250,000 (Dirt) 1,900m
8.15pm: Zabeel Mile Group Two $250,000 (T) 1,600m
8.50pm: Meydan Sprint Group Two $250,000 (T) 1,000m
9.25pm: Handicap $135,000 (D) 1,400m
10pm: Handicap $135,000 (T) 1,600m
CONFIRMED%20LINE-UP
%3Cp%3EElena%20Rybakina%20(Kazakhstan)%0D%3Cbr%3EOns%20Jabeur%20(Tunisia)%0D%3Cbr%3EMaria%20Sakkari%20(Greece)%0D%3Cbr%3EBarbora%20Krej%C4%8D%C3%ADkov%C3%A1%20(Czech%20Republic)%0D%3Cbr%3EBeatriz%20Haddad%20Maia%20(Brazil)%0D%3Cbr%3EJe%C4%BCena%20Ostapenko%20(Latvia)%0D%3Cbr%3ELiudmila%20Samsonova%0D%3Cbr%3EDaria%20Kasatkina%E2%80%AF%0D%3Cbr%3EVeronika%20Kudermetova%E2%80%AF%0D%3Cbr%3ECaroline%20Garcia%20(France)%E2%80%AF%0D%3Cbr%3EMagda%20Linette%20(Poland)%E2%80%AF%0D%3Cbr%3ESorana%20C%C3%AErstea%20(Romania)%E2%80%AF%0D%3Cbr%3EAnastasia%20Potapova%E2%80%AF%0D%3Cbr%3EAnhelina%20Kalinina%20(Ukraine)%E2%80%AF%E2%80%AF%0D%3Cbr%3EJasmine%20Paolini%20(Italy)%E2%80%AF%0D%3Cbr%3EEmma%20Navarro%20(USA)%E2%80%AF%0D%3Cbr%3ELesia%20Tsurenko%20(Ukraine)%0D%3Cbr%3ENaomi%20Osaka%20(Japan)%20-%20wildcard%0D%3Cbr%3EEmma%20Raducanu%20(Great%20Britain)%20-%20wildcard%3Cbr%3EAlexandra%20Eala%20(Philippines)%20-%20wildcard%3C%2Fp%3E%0A
UAE currency: the story behind the money in your pockets
SPEC%20SHEET%3A%20APPLE%20M3%20MACBOOK%20AIR%20(13%22)
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The specs
Price, base / as tested Dh1,100,000 (est)
Engine 5.2-litre V10
Gearbox seven-speed dual clutch
Power 630bhp @ 8,000rpm
Torque 600Nm @ 6,500rpm
Fuel economy, combined 15.7L / 100km (est)
The specs: Rolls-Royce Cullinan
Price, base: Dh1 million (estimate)
Engine: 6.75-litre twin-turbo V12
Transmission: Eight-speed automatic
Power: 563hp @ 5,000rpm
Torque: 850Nm @ 1,600rpm
Fuel economy, combined: 15L / 100km
The nine articles of the 50-Year Charter
1. Dubai silk road
2. A geo-economic map for Dubai
3. First virtual commercial city
4. A central education file for every citizen
5. A doctor to every citizen
6. Free economic and creative zones in universities
7. Self-sufficiency in Dubai homes
8. Co-operative companies in various sectors
9: Annual growth in philanthropy
Specs
Engine: Duel electric motors
Power: 659hp
Torque: 1075Nm
On sale: Available for pre-order now
Price: On request
Killing of Qassem Suleimani
ABU%20DHABI'S%20KEY%20TOURISM%20GOALS%3A%20BY%20THE%20NUMBERS
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