GOLD SUPPORTED BY WEAKER DOLLAR, STRONGER OIL PRICES

by Joe Battaglia | June 09, 2009

Gold and silver rebounded today with gold hitting a high of $964.50 on the August contract while silver hit $15.35 at the high. However, both have eased back off of those highs with gold trading up $5 and silver up $.23 in early trading. Given the fact that the dollar is down 81 basis points this morning, the rally in gold is less than one might have expected.

GFMS reported to Dow Jones Wire Service that they think rising Indian physical demand will result in a higher floor price for gold. In turn, "This could spark more speculative gold buying." As a consequence, what we are again seeing is another high-level consolidation to consolidate the recent gains and build a new base for another assault on the $1,000 level. Some analysts think this period of correction and consolidation will end within the next couple of weeks. At that point, they think gold will start the next major move upward.

In addition to the weaker dollar, gold is also supported by stronger oil prices. Oil is up $1.58 at $69.67 a barrel. High oil prices eventually translate into rising inflation. There remains an abundant supply of oil. Therefore, the question is why is oil so high?& Obviously, it is due to the weak dollar and the expectation that the dollar will continue to weaken.

The Wall Street Journal reports that as many as ten of the banks that received TARP funds will be repaying some or all of those funds in the next few weeks. One would have thought that would cause the Dow Industrials to rally strongly. However, the Dow can barely eek out a 14-point gain on the news. Similarly, the downgrading of Ireland's credit rating yesterday had little impact on the markets.

A gold close above $950 would provide more encouragement to the market and perhaps enable gold to consolidate at higher levels between $950 and $980. Many view the gold market at these levels as an bargain buying opportunity. From a technical point of view, gold is doing precisely what is supposed to do, working off an overbought condition. Therefore, investors should take advantage of this opportunity to acquire precious metal assets. Whether you are a first-time investor or whether you are attempting to increase your gold holdings to a more comfortable level, this is the time to act.

Call Goldline today at 1-877-341-2646 for assistance in getting started. In addition, you may wish to ask about Goldline's Price Guarantee Program, which provides a two-week window of opportunity to re-price your transaction in the event that the market should pull back further. This will provide comfort for many investors. Call Goldline at 1-877-341-2646 now to learn more about investing in gold. Many people are interested in putting gold and silver in their IRA accounts and 401(k) rollover accounts. Goldline can assist you in that process. They are also happy to provide you with free information on IRA accounts. Call Goldline at 1-877-341-2646.

Be sure you ask for the free information package. It contains excellent articles discussing the development of a new global currency to replace the dollar, articles that discuss the concerns that China and others have about the falling dollar, articles about formal devaluation of the dollar and of course a number of articles that discuss the precious metals markets and price forecasts over the coming years. Call Goldline now at 1-877-341-2646 to receive the free information package.

Investors should contact Goldline and ask them to explain the features, benefits and cost structure of the various gold and silver investments that are available to you. Select those that best meet your own personal and individual investing needs and objectives. Investors looking for low transaction costs may wish to consider bullion assets such as American Eagles, Swiss 20 Francs, Krugerrands, Canadian Maple Leafs, Silver Bags or Silver Bars. However, the Price Guarantee Program is not available with these assets.

If you would like to take advantage of the Price Guarantee Program, which provides you with a two-week window of opportunity in which to re-price your order in the event of a correction, you must select assets with some collectible value such as 20 Francs, Double Eagles and Silver Dollars. Call Goldline at 1-877-341-2646 for further information on the Price Guarantee Program.

To receive the free information package, including articles on the dollar, the economy and gold call Goldline at 1-877-341-2646. Goldline also provides several other helpful articles. There are a number of other independent third-party source articles that you will find extremely helpful and informative. You will also receive the Client Account Agreement, a company brochure and a Coin Facts Risk Disclosure booklet. Read these carefully before you make an investment. Call Goldline at 1-877-341-2646 now to receive your free information package.

†This material has been prepared for private use. Although the information in this commentary has been obtained from sources believed to be reliable, Goldline does not guarantee its accuracy and such information may be incomplete or condensed. The opinions expressed are subject to change without notice.

You should review Goldine's Account Agreement along with our risk disclosure booklet, Coin Facts for Investors and Collectors to Consider ®, prior to making your purchase. Goldline has a spread or price difference between our selling price, called the "ask", and our buy-back price, called the "bid". That spread varies depending on coin or bar you acquire. Spreads on 1 oz bullion coins, 90% silver dimes and quarters, and one ounce and larger bullion bars are 13%. All other coins have a spread of 28%. There is also a 1% liquidation fee when you sell your coins back to Goldline. The market must go up enough to overcome this spread before an actual profit is achieved. Precious metals and rare coins can increase or decrease in value. Past performance does not guarantee future results. Coins are a long-term, three- to five-year, preferably five- to ten-year investment. We believe precious metals are suitable for 5% to 20% of the average investment portfolio though others may recommend a different percentage.

To receive free information package on gold and precious metals investing, call Goldline at 1-877-376-2643.

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