Forum Archive Index - April 2004

["Baa Baa" <baa_baa@hotmail.com>]

Gold in USD has dropped. In Kiwi$ it has perked up slightly because the 
forex effect hasn't dropped the Kiwi against the USD quite as much as Gold 
has dropped in USD 
http://fx.sauder.ubc.ca/cgi/fxplot?b=XAU&c=NZD&rd=91&fd=1&fm=1&fy=2003&ld=31&lm=12&ly=2004&y=daily&q=volume&f=png&a=lin&m=0&x=
 
Gold in AUS$ has actually perked up too 
http://fx.sauder.ubc.ca/cgi/fxplot?b=XAU&c=AUD&rd=91&fd=1&fm=1&fy=2003&ld=31&lm=12&ly=2004&y=daily&q=volume&f=png&a=lin&m=0&x=

This is important to note imo for two reasons;

1. Physical metal buyers in AUS or NZ aren't seeing a drop in local priced 
Gold, so it's not neccessarily a better time to buy as there is no weakness 
to speak of. The best time to buy is always a strengthening USD -and- a 
strengthening local currency, which of course only happens when locally 
there is some event which resets the forex ratios, like interest rate 
movements for example. The reverse is true for selling strength, i.e. a 
weakening USD and a weakening local currency = local priced Gold shoots 
upwards.

2. The AUS gold mining stocks weaken in sympathy with the USD Gold price, 
not the AUS Gold price, so I agree, buy that stock weakness if you can. Some 
people may not realise that the minies pay expenses in $AUS, but sell Gold 
in $USD, so while expenses stay flat, revenue falls = stock price falls.

Nice to see a timely post about the metals stocks.
Best to you
BAA


>From: "Lazy Haggis" <lazyhaggis@hotmail.com>
>Reply-To: sharechat@sharechat.co.nz
>To: sharechat@sharechat.co.nz
>Subject: [sharechat] Weak Gold - Great Time To Buy
>Date: Wed, 14 Apr 2004 20:28:09 +0000
>
>Gold has been a bit weaker over the past couple of days. This is quite 
>normal, not unexpected, and offers a great time to buy Aussie gold shares. 
>The price of gold may drop further, but don't count on it. Remember buy 
>into weakness, and sell into strength. With the fall in OZ and NZ dollar 
>rates compared to the US, the fall in gold price is meaningless. However, 
>the sympathy fall in OZ gold stocks is not meaningless, it represents a 
>great buying opportunity.
>
>Currently the gold price is undergoing a wedge reconciliation top, which 
>probably has several weeks to run yet.  This is similar to the wedge top 
>which ran from Feb'03 to Aug'03.  There are many good upcoming Aussie 
>juniors and producers, we all have our favourites, but at prevailing prices 
>the following offer good entry prices (as of today) with plenty of upside 
>over the coming year.
>
>AVO, BRW, CRS, GBG, GTM, OXR, PNA, RNG, RSN, SED, SRI
>
>Enjoy the day,
>Lazy Haggis
>The Mumbo Jumbo Filter
>
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