trading strategis

trading strategies

Past and Present Analysis of Gold Price

With the abolishment of Bretton Woods Gold Standard between 1971 and 73 , since then , the price of Gold in the international market started to rise from 35 to 100 . Ten years later , another significant rise of gold price happened tripling its original price from 100 to 300 (Smith 2003 : 1 . There are some instances that the rise of the prices of gold is associated with the performance of the dollar currency as well as oil prices . It is said that during the invasion

of Iraq to Kuwait in 1990 due to political tension , oil prices increased from 10 to 27 along side with the price of gold which also increased by 5 since it reacted in the inflationary pressures imposed by the oil price hike

Back in the 1980 , there was an oil price shocked happened in the market that caused major inflationary dilemmas to various countries around the globe . Thinking rationally , those gold mining firms would incur higher operational costs from extracting gold from the grounds , in for their profit not to be affected by the oil price increase , they would pass it to the gold buyers and so with the rest of the story (Saville 2006 : 1

With regards to the relationship of gold prices to dollar currency during the early 1980 's just like what really happen in the financial market , as the dollar currency weakens prices of gold increases since it could also carry value . Before , gold serve as a standard of monetary unit in most of the countries across that globe until such time that it could no longer combat various financial problems locally and internationally that gives the countries , especially US , to come up with another monetary standard that would have the capacity to address various financial problems and this is the start of the advent of Dollar Standard in the financial market . Well , setting aside the issue on Dollar Standard , this clearly shows that gold could also serve as a monetary carrier . This only means that gold has the same characteristics with money in terms of being used in exchanging goods and services

In for us to fully understand the nature of gold industry in the market , we also have to visit the current situation of gold market for us to be able to compare its performance

According to Business Week , the current price of gold in the market has already reached above 700 per ounce as of September 6 of this year Those investors who bought gold prior to the increase in the prices were now glad about the situation since they could earn premiums ' from currently selling their gold in the market . It is not only those gold investors ' who benefited in the said gold price increase . Mining industries were also enjoying the good performance of the prices of gold . Indices of various gold mining firms gained from a minimum of 4 This period is being treated by most of...