Gold Prices and the Silver Factor

Gold Prices and the Silver Factor - The Historical Gold-Silver Ratio

A Leap In Silver

reasons gold price to increase

Interestingly enough though, silver has appeared to become stronger in the market against gold in the last 30 years. I don't mean to say that silver is stronger than gold, only that the ratio has begun to close the gap a bit.

Many believe that gold is falling since silver is becoming increasingly stronger but this is untrue. The reality is that both metals are increasing in value yet what makes silver prices appear to be stronger, is that they are increasing at a higher rate than gold. Recently, silver increased 300% to $16.19 per ounce from 2001 when it was only selling for $4.05 per ounce. Gold also performed well in the same eight years increasing 219%.

The reality is that there is less silver available above and below ground. This fact should make you run towards silver because the price is no where near the supply ratio.

Gold remains strong in perceived value - but it should be noted that silver is unpredictable in today's market. The yellow metal is still viewed as a metal with monetary value while silver is both industrial and monetary. Historically, gold has been stronger than silver, but with the increasing momentum and demand, silver could be quite prosperous for investors.Article Source: http://EzineArticles.com/2190392

Gold Price Forecast 

2010 Seasonal Trends the Yellow Metal ( total rise of 37%):

Q1: highest price was 1136, lowest price was 1044 -correction season (down 8% from 1136)

Q2: new peak achieved at 1255.49 (21 June 2010) - a rally season - (up 11% from 1044)

Q3: July saw a correction; price was down to 1156 - correction - (down 8% from 1255.49)

August & Sept saw another rally - new peak at 1320.6 (27 Sept 2010) - (up 14% from 1156)

Q4: New historical peak achieved at 1431.33 (6 Dec 2010) - a rally season (up 24% from 1156)

1b.) Fundamentals Support for Gold Price's rally in 2010:

Increased in investment and physical demands were supporting gold price to rise over the whole of 2010. Commodities prices rose as a result of increasing demands mainly from emerging countries, and also caused by increasing speculative demands from the markets. Other commodities such as aluminum, palladium, also surged in 2010.

Article Source: http://EzineArticles.com/5739635

What Causes Gold Price Inflation

These factors can be complex system that can be very confusing even though they look simple on the surface. Here we discuss various factors that cause gold price inflation. The gold and prices also fluctuates due to many reasons like currency inflation, dynamics which causes increase in demand and the role of central banks. By knowing these factors you can gain knowledge of when it is appropriate to sell your gold jewelry.

Currency inflation is also one of the major causes for the fluctuations in gold prices. Inflation occurs when there is increase in the price of goods. For example, when a consumer finds out the prices of the commodities have increased after visiting a grocery shop then we say it is inflation. But actually speaking inflation is increase in money supply. This is how the gold rates move high along with the countries currency and results in gold price inflation. As gold cannot be arbitrarily produced, it is used as an exchange unit of value. As the currency declines per unit value then the gold rate increases.Article Source: http://EzineArticles.com/5515984
reasons gold price to increase