Friday, January 13, 2006

Anglo Gold Sees Higher Gold Prices

By Eric Onstad

JOHANNESBURG (Reuters) - South Africa's AngloGold Ashanti is bullish enough about a strong gold price that it does not expect to resume most hedging for at least a couple of years, a top official said on Wednesday.

AngloGold, the world's second biggest gold producer, is the only major South African gold miner that has not rejected the practice of hedging -- selling bullion in advance to lock in current prices.

"We don't believe in this current market that there's any need to hedge again or add to our hedges," Marketing Director Kelvin Williams told Reuters in an interview.

Hedging is controversial and hotly opposed by certain investors who argue that gold firms should get direct exposure to the current gold price.

Williams said AngloGold still believes a certain amount of hedging is necessary to protect revenue flows against price declines so it can pay dividends and fund capital expenditure.

But prices should remain firm for the next few years, making hedging unnecessary, he said.

"Our view of the gold price is a sufficiently positive one for the immediate future and the near-term and the middle future that the need for capital expenditure and dividend payment should be adequately catered for by the spot price."

He said middle future could be taken to mean a couple of years.

The only exception might be for new mines, he added.

"If we were to look at a new project, where there was perhaps a high technical risk or geological risk or some other risk, we may wish to moderate the revenue risk by getting certainty about pricing," Williams said.

Gold surged to a 25-year peak this week after gaining 18 percent last year and another 5 percent in the past 10 days.

1/12 JOHANNESBURG (Reuters) - South African gold output fell 11.3 percent in volume terms while overall minerals production declined 3.4 percent in November compared with the same month in 2004, official data showed on Thursday. –END-

Saturday, January 07, 2006

Tail Wind For Gold and Silver - Part II

This Friday the USD broke below its 10 month long uptrend line. That is in addition to getting down below its 100 day moving average. The USD is looking awful. This will help gold and silver a lot. Or, is helping gold and silver a lot since they have recovered wonderfully and made new futures highs on Friday.

Another thing that could help gold and silver is a lot of "money" (USD) getting out of the US stock market and looking for a place to go, another bull market to go to. A lot, as in a US stock market crash in 2006. Take a look at these charts:


Some would call the shape of the prices in the last month + a flattening or broadening top. Check your Edwards and Magee (a classic technical analysis book) on this.

The shape of the prices could also be called a megaphone, where prices are taking turns going both up and down. The highs getting higher and the lows getting lower as time goes on. Confusion in the stock market. A dissapation of bullish energy.

Thursday, January 05, 2006

Tail Wind For Gold and Silver

Yesterday the USD Index broke decisively below the neckline of a head and shoulders topping pattern to the USD year long rally:

There are still a huge number of those that are short gold that still have to get out of their positions. That means huge buying still to be done. From Le Metropole Cafe on Wednesday, January 5:

"This is staggering. The gold open interest only rose 2277 contracts to 325,524 on a $14 up day. To put this in perspective, years ago the open interest went up 77,000 contracts over a period of weeks and all gold was allowed to go up by The Gold Cartel was $7.

This tells me GATA is right on the money about the shorts panicking in order to extricate themselves from their short positions. How are they doing? Not so good. By my calculations all they covered yesterday was around 40 tonnes, max. The total short position is above 10,000 tonnes. If only 10% of the minimum number of shorts plan to cover, it will take another 25 days like yesterday. 25 TRADING DAYS!"

Monday, January 02, 2006

Gold Rush 21 DVD To Be Available Soon

The Gold Rush 21 (an historic gold conference) DVD will include a 24 minute highlight film and 8 hours of presentations by the speakers at the Dawson City conference. The DVD premiere showing will be at Joe Martin’s gold conference in Vancouver on January 22.

In the mean time, there is a introduction/trailer requiring QuickTime at: