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Asian Metals Market Update: Gold Recycling in India is Growing

There will be good physical demand of gold and silver if they rise today. Indians were buying very less gold last week. If gold prices rise Indians will buy lots of gold. Summer season in Europe and USA will officially come to an end on 7th September. Traders have started taking positions for (a) September end (b) US presidential elections (c) Christmas and New Year. Only sharp rise in US dollar Index can cause a selloff in gold and silver. Japanese yen will be very volatile till a new successor to prime minister is not announced.

Technically gold and silver are bullish at the moment. It will not be a one way trade. Day traders will have to be choosy in making their calls to buy or sell. Do not let your heart rule over technical and momentum this week.

Lastly US ten year bond yields between 2nd September and 4th September needs a close watch. A very sharp rise in US ten year bond yields can cause a quick sell off in gold and silver.

India’s jewelry sector will be a big change. There will be a complete makeup in the next two years. A lot of small shops and tiny shops will face closure. Continued rise in gold prices, inability to adapt to new design changes and every changing new laws enforced on jewelers are some of the reasons. The efforts by various gold associations (sarafa bazar associations) are not sufficient or too late to prevent closure tiny jewelery shops and small shops. I do not see a significant fall in Indian gold demand over the coming months and years. Indian gold imports can fall as gold recycling is shaping up in a big way. Gold recycled in India is getting accepted by banks and financial institutions. I will start a weekly series in this issue soon. (every Monday at www.goldseek.com).

US jobs numbers are even more market moving than ever, after the shift in stance by the Federal Reserve last week. US jobs will play a greater role future interest rate decision of the Federal Reserve.

COMEX GOLD DECEMBER 2020 – current price $1978.40

  • Gold needs to trade over $1950-$1955 zone to rise to $2024 and $2074.
  • Sellers will be there only if gold trades below $1968 and crash below $1948.
  • This is the view till tomorrow only.

COMEX COPPER DECEMBER 2020 – current price $304.40

  • Trend is bullish.  Copper can rise to $314.00 (by Wednesday) as long as it trades over $297.00.
  • Copper will crash or move into a short term bearish phase only if it trades below $297.00.
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