Tuesday, April 16, 2013

Gold crashes 10%


The big market mover has been gold, which dropped an incredible 10% over the last 3 trading days (and the most in 30 years of trading - lots of charts showing the spread to other markets).

This morning XAUUSD traded $1325, but has since staged a mini comeback to $1375.

The big question is why has gold dropped so sharply? The article offers the following theories:
  • withdrawal of QE due to expected US recovery?
  • expected forced sale of gold due to Cyprus (and soon after, other troubled EZ countries)?
  • unfulfilled expectations of hyperinflation from QE?
  • Gold is not an investment, and hence is a greater fool trade....and its finally collapsed?
  • manipulation by the Fed reserve, hedge funds, bullion banks and other players?

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