NEW YORK (TheStreet ) -- Gold prices have risen more than 10% in 2010, recently setting a new high of $1,249 an ounce. A flailing euro and imploding debt fears in Greece, Spain and Portugal triggered gold's recent surge, but eurozone issues don't tell the whole story. More on Metals and Mining Final Glance: Silver CompaniesFinal Glance: Gold CompaniesMassey Mining Tragedy: Financial Impacts Market Activity ETFS Phys Gold Shares| SGOL UPJ.P. Morgan Chase & Co.| JPM DOWNSPDR Gold| GLD UP Gold prices pushed through the key psychological resistance area of $1,200 an ounce on May 6 when Greece riots and violence dominated the news. Since then, the gold ETF, SPDR Gold Shares(GLD) has added 31 tons, totaling a record 1,220 tons while the stock hit a new 52-week high of $122.24. Gold prices are volatile. Gold fell over $50 last week, but was now surging over $15 to $1,193 an ounce and is looking to retest the $1,200 level. Investors sell gold for cash when equities plummet, and bargain-hunters buy up gold at "discount" prices resulting in a strong tug-of-war for prices. Aside from eurozone sovereign debt issues, there are five other fundamental factors that contribute to gold's double digit price moves. 5. Price Manipulation
Price manipulation is the most controversial theory that has circulated among gold bugs for 20 years. Conspiracy theorists think that gold prices have been illegally suppressed over the last two decades by central banks and governments. GATA or Gold Anti-Trust Action Committee is the biggest complainant. Central banks reportedly have 32,000 tons gold with the International Monetary Fund accounting for 2,800 tons. Under the Washington Agreement on Gold, its members can sell a maximum of 400 tons a year, thereby restricting the amount of gold in the open market place. GATA argues that central banks in actuality have less than 15,000 tons of gold, and that the missing gold has been secretly sold or leased into the market to prevent gold prices from rising to their actual value, which should be between $3,000 to $5,000 an ounce. More on http://www.thestreet.com/story/10760375/1/top-5-reasons-gold-prices-move.html
OGC Price at posting:
$2.96 Sentiment: Buy Disclosure: Held
