Overnight international gold prices have fall very significant – similar to the events of 2009, which is down to its lowest point after a few months before reaching the highest point. The difference is only in the cause of the ups and downs of the price, and time of occurrence of each of the extreme points of him. UPS and downs of prices in the year 2008/2009 was a factor in the crisis in America whereas the fall in the price of this time its main cause is the crisis in the Euro Zone.

The pattern of the influence of the Euro and the Dollar against gold prices this world can be seen on the graphs below. Because the price of gold is calculated by the US Dollar and the price of gold has a reverse relationship – inverse relationship – against the US Dollar which is represented by the US Dollar Index. We can see in the graph below, the grey area represents the US Dollar Index surged very significant past few days.

The chart above also shows that the Euro-one has the relationship upside down with the US Dollar with gold, or in other words, the Euro has a relationship that is in line with the gold price in US Dollar. When the Euro exchange rate, the price of gold fell-fell.

The question is whether the fall of the Euro that makes people flocked to move funds into the US Dollar is going to last long so that the Euro and gold are both will continue to slump?. That possibility remains, at least two factors under which would be the cause.

• When the conditions of the Euro Zone is getting worse and not saved, then breakout into safe haven while the US Dollar will steadily grew. The US Dollar is becoming increasingly expensive and means the price of gold is getting down.

• When the Euro Zone did not undergo deterioration that is fundamentally more – no matter the price of gold could stay off by panic selling as it did in the last few days.

If these two factors led to the price of gold goes down in the near future, thus if there is a factor that will push it up?. Of course there is also, although the possibility of a bit is the long term.

The Euro Zone is a United States major trading partners, therefore, in calculating the strength of the US Dollar or was later mirrored by U.s. Dollar-weighted Index of the Euro is the most massive that 57.6% followed by Yen Japan that only 13.6% and currencies of other countries are less influence.

When the crisis in the Euro Zone is sustainable, United will surely hit the resin also, among others, through exports to the country’s main trade partner countries will decline and the fall in market risk in financial markets due to mutual dependencies between financial with one another. So the US Dollar is only temporary by Euro crisis benefited.

Then how are we supposed to be addressing the fall of the gold price, especially for those of you who are just starting to buy gold or Dinar at the time the highest price that the last few months?.

First keep in mind is the Euro crisis is not unique, the US Dollar-pun (and various other paper currencies) may be subjected to the same crisis – even the US Dollar is also being experienced it, simply because the comparison is the Euro which is worse – U.s. Dollar seems to be improving.

When the bad face of the US Dollar is no longer covered by the ugliness of the Euro, Dollar-will perform like the Euro. Because the Dollar has a inverse relationship with gold, that’s when gold prices will recover as its peak a couple of months ago.

Both been disturbed in world gold prices-trigger by the purchasing power of US Dollar fluctuations, it should be demonstrated to us all – that there is no safe from risk investment.

That is why, through this kind of writing and also the writings of earlier, we would emphasize the signings of society compared to the effort to sell gold or Dinar itself, prior to the charity.

Third, the crisis reminds us of the importance of building the economic power of real sector to meet the minimum basic needs such as food, clothing and the Board. Not easy to do, but the other — any investment anyway also proved no easy task, so it should still continue to try and attempted.

Other articles you need to read;

• 3 factors will dominate soon driving the gold price fluctuations.
• Does the Euro exchange rate down drastically affect on the fall in gold prices?
• The Easiest Way to Understand and Manage The Investment Risk
• Which one is your investment choice, investment in shares or gold for the best?
• Where are the trends in gold prices towards the end of 2011?

This entry was posted on Thursday, December 15th, 2011 at 2:08 am and is filed under Gold Dinar. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.