While on vacation in the middle of the eastern Oregon checking in now and then to see spot prices. I was not too shocked to return to the same thing that took place last week. Gold is moving quickly, oil is the main initiator here, as I wrote last week, that TPTB would not let it get lower than $75. Thursday it was $74.42 if the prices remained low it could cause a major problem for the Keystone pipeline and make it financially undo-able, the break even price for the new Canadian oil production is around $85, already up and running producers can do it for much less but this affects all the new projects.
Is it really a surprise when it came down to the release of this passing, that we see oil rising. The Democrats are now standing behind the approval for the Keystone XL pipeline. All we have to do is sit back and wait for the president to sign it, since he is in Asia he will get to it sometime in the next week. Even though Congress might try to take the responsibility away from Obama, he is the only one who can approve it because it crosses international borders. The question every broker and oil executive is wondering, will he pass it? Legislation's like this in the past have been vetoed and frowned upon by the White house administration. The pipeline is a major concern for the environmentalists that the Canadian extraction could worsen global climate changes and threaten the U.S. waterways. On the other side, this is huge for the U.S. to become energy independent, creating mass amounts of job growth that can lead to a strong U.S. economy and we are in extremely different circumstances than when this bill was pushed in 2008.
We know that gold tends to follow oil in the market and the indicators to make calls happen fast. With the rise of the Euro and the dollar longer than it should have been we have to add in all the factors that sway PMs for instance we have the Swiss Gold Initiative coming and traders on high alert waiting the vote, but many already assume it will be a no. The physical gold moves the market way less than the digital kind. Let us add GOFO Gold Forward Offered Rate, kind of a way to swap gold in return for USD a lease to own dollar rate. However, there is not an interest like on a lease with a borrower and lender where the lender gains it is more of a swap because the lender is the one paying a rate of interest. It is not the spot price of gold; it is a subtraction of LIBOR corresponding values. These swaps are made from one up to 12-month periods. Shorting mass amounts of gold drives up the lease demand and that GOFO then is lower. There are no supply problems for contract and the idea of leasing metals appeals to many especially when they see the contracts lower than spot price like we have. A negative GOFO shows that demand for the swap is high; this could be for lack of inventory by COMEX or the futures offered by the SGE. These indicators with the GOFO could be that big changes in the PMs could be on the horizon, even if the demand is just so traders can short gold the GOFO has shown the bottom price before could it again?
Bought Nov. 14
SLV April 17, 2015 calls strike $15.50
paid $1.23
Hello and welcome to our FX blog. If you are wanting active management of your funds without having to pay high commissions and be able to access your capital any time without penalties, you have come to the right place. With our assistance, we can set up your account to be hedged across 8 different currencies, instead of it all based in one potentially volatile currency.
Membership
Are you well diversified? Is your savings all in USD or spread across multiple types of assets, but still based in USD? If it is, you are still not what we consider ultimately hedged, as in hedged into other nations currencies which are backed by their allocations, production, resources and politics. We believe the best way to be hedged to to be spread across the 8 most respected western currencies. Those being the Australian dollar, Canadian dollar, Swiss franc, Euro dollar, Great British pound, Japanese yen, New Zealand dollar and United States dollar. Rotating among these with a slight edge producing a gain above equilibrium.
This strategy uses the same free floating cash approach as all large banks, but with the tactical advantage of intermittent currency exposure utilizing a probable edge.
Think of this system as exactly the same as holding cash in a bank account, but with the ability to use leverage, letting trades sit until hitting either a Target, Stop or direction reversed. This strategy is extremely diversified and as such, is not subject to over weighted moves due to all your cash being held in a single currency bank account.
The goal of the system is to minimize the volatility associated with a traditional cash bank account. Substituting single currency volatility and buying power decay, with account stability and growth.
There is no obligation and you can cancel the program at anytime.
