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AGE Gold Commentary is our regular report analyzing trends in precious metals and rare coins. We monitor domestic and international markets and extrapolate from our 30 years in metals to place current events into a hard asset perspective. View archives.

10/23/2003: Gold regains upward momentum on dollar weakness


Greetings from American Gold Exchange. In this brief issue of Gold Market Commentary:

Gold regains upward momentum on dollar weakness
Platinum defies gravity, Silver over $5.00, Palladium over $200
St. Louis Coin Show update –strong demand, few coins!

Gold regains upward momentum on dollar weakness

Resuming their dominant trends for 2003, gold has regained its upward momentum this week and the dollar is again losing ground to most major currencies. This return to normalcy comes after a temporary strengthening of the dollar and a strong correction in the gold price earlier this month, which caused it to channel between $370 and $375. On Tuesday gold surged $7.50 to close at $381.50; on Wednesday it gained another $5.10, closing at $386.60.

Gold appears to be readying itself to test the psychologically important $400 level and the more significant $417 resistance level, where it stalled in the 1990s. Weakness in the stock market and the dollar, along with increased inflationary pressures and new fears of higher interest rates, are combining to stimulate physical demand among investors. These factors should drive the gold price even higher in the near future.

While gold is likely to test $400 before year’s end and move substantially higher in the longer term, up to $500 in the next 12 to 24 months, we should expect strong resistance at $415 to $417 in the next two to four months. Please have a little patience if gold channels just under the $400 mark, and prepare for a wild ride when it pierces $417!

The relative strength or weakness of the U.S. dollar remains the key that will unlock the door to a much higher gold price. With record budget deficits, equivocal signs of economic recovery, and only tepid signals that the Bush Administration is interested in protecting the dollar, this door could swing wide open at any time. We’ll keep you posted!

We continue to recommend buying gold aggressively under $375, as we’ve been advising all year.

Platinum defies gravity, Silver over $5.00, Palladium over $200

Platinum has risen from $710 to $745 in the past couple of weeks. One of our trusted allies believes it could reach high as $850, but we’re skeptical of platinum's ability to go much higher and do not recommend buying into the current up-trend. Platinum is very expensive relative to gold and palladium, and could fall sharply at any time. We believe the eventual downside risk for platinum is two to three times greater than its upside promise at this point.

Silver has surged back over $5.00 to $5.15 and looks promising again after weakening in sympathy to gold over past few weeks. Palladium is currently trading at $202, and looks like the precious metal most likely to double in price in the next 18 to 36 months.

St. Louis Coin Show update – strong demand, few coins!

We’ve just returned from the St. Louis Coin Show where, as expected, demand for quality U.S. classic coins remained very strong while supplies continue to dwindle. Prices for many U.S. gold coins are now about 10% higher, on average, than just a few months ago. We still believe the biggest gains are ahead of us, but this market is beginning to move in earnest, as we warned you it would. If you’re interested in capitalizing on one of the best bull markets in classic coins since 1988 and 1989, following the 1987 Dow crash of 25% in a single day, do not delay!

Please have a look at our newly-updated selection of outstanding, hand-picked classic U.S. gold coins , fresh from the St. Louis Coin Show.

For specific physical gold recommendations, please call our account managers, Matt Warden and Tom Simonian, toll-free at 1-800-613-9323.

As always, thanks for your time!


Dana Samuelson, President
Dr. Bill Musgrave, Vice President


Metal Ask      Change
Gold $1,939.93           $17.41
Silver $26.53           $0.92
Platinum $988.20           $40.35
Palladium $2,223.59           $20.21
In US Dollars