Gold prices soared by US$15.80 to US$1,066.90 per oz
WTI crude oil declined another $0.40 to $34.55 per barrel.
Gold to WTI Crude Ratio finished at a new 27-year high of 30.88.
Will Crude Oil prices ever bottom?
excellent chance that Gold to WTI Crude Ratio will rise in early 2016 back to all-time high of 35.39 that was set 42 1/2 years ago in June of 1973.
Based on the current gold price of $1,066.90 per oz, this would value WTI Crude Oil at $30.15 per barrel.
short-term breakout for gold to $1,223 per oz is very possible
will send the Gold to WTI Crude Ratio to record high of 35.39 simply by WTI Crude Oil remaining flat at its current price.
WTI Crude now trading at -59.88% below 5-year average of $86.11 per barrel.
Only once before in history has WTI Crude Oil traded further below its 5-year average.
On March 31, 1986, WTI Crude Oil declined to a 13-year low of $10.25 per barrel, which was -66.27% below its 5-year average at the time of $30.39 per barrel.
If WTI Crude Oil once again bottoms at a price that is -66.27% below its current 5-year average of $86.11 per barrel, it would equal a WTI Crude Oil price of $29.04 per barrel.
Based on the above estimates, NIA (National Inflation Association) predicts that WTI Crude Oil will bottom in the short-term between US$29.04 and US$30.15 per barrel.
My comments : What this means is that oil prices still have room to go down. What they are saying is 'sell oil assets and buy gold'. Gold prices are moving up already and may continue to move up (I can hear the money boys laughing already - you just cannot predict the actual gold price movements.)
But here is more bad news for the oil prices (and good news for gold prices) :
Us Lifts 40-year-old Ban On Oil Export
United States on Saturday lifted a 40-year-old ban on export of oil
sending signal to world that US is global energy superpower
crude exports comes economic growth, enhanced energy security for allies
"Business leaders representing every sector of the US economy applaud
it's good for Americans, it's good for the oil industry, it's good for the world
-- BERNAMA
My comments : The US has lifted a 40 year ban on oil exports. This will cause oil prices to weaken even more. This is really great news for the whole world.
Even for Malaysia. It may mean less revenue for Petronas and the gomen but cost of input factors in the larger economy will decrease. This will make more sense if we are a larger manufacturing economy. Meantime manufacturers should benefit. Alhamdulillah. We need jobs.
p.s. IQ 3.85 faham ke? Perkasa boleh faham ke? Prime moron will definitely not understand. - http://syedsoutsidethebox.blogspot.com/
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