Buy Gold In Canada
Gold and oil have a significant relationship with the Forex market. Often, these two products are used as a leading indicator in making trading decisions Forex market.
Gold
Why is that gold has a negative or inverse relationship to the dollar if the U.S. is the second largest producer of gold (not placed Australia in 2006)?
The answer is simple (or maybe not) …
The obvious reason for this inverse relationship is that gold is always a price against the dollar, a strong dollar, of course, buy more ounces of gold (and a weak dollar can buy less gold ounces).
But there is another less obvious reason for this inverse relationship: for decades, during periods of uncertainty investors tend to migrate away from its capital from USD to gold as a safe haven.
Ok, to see some figures: The USD has fallen to record lows against some currencies, including: EUR, CHF and CAD, while gold (XAUUSD) has reached record highs.
Seniors who have a direct positive relationship or gold are the Canadian dollar and Australian dollar.
AUD – Australia's third largest gold producer in the world and as a result, the coefficient of correlation of AUD and the price of gold is about 80%. So the AUD always benefits from rising gold prices and also decreases when gold prices fall.
CAD – Canada is the third largest exporter global commodity. This makes the ADC and Gold move in the same direction, although the correlation coefficient is not as big as the AUD and gold.
What would be the case of euros or other currencies in which there is no relationship (at least not a clear one)?
Other majors will directly related to gold, because both (commanders and gold) are priced in U.S. dollars.
Oil prices
Generally speaking an increase in the price of oil results in increased transportation costs, utilities and heating costs and the cost virtually all of finished products (especially oil-dependent economies like the U.S., China, India and other developed countries).
The case for an indirect link between oil and the U.S. dollar:
U.S. represents only 5% of the world's population but consumes 25% of the fossil fuel-based energy in the world.
U.S. imports about 75% of its oil, but owns only 2 percent of reserves world.
Because of this dependence on oil and foreign suppliers, the rise in the price or supply disruptions will negatively affect the U.S. economy (Hence the USD) in a greater degree than any other nation.
Canada is one of the few developed countries that are net exporters energy (oil for example). Canada has the largest oil reserves in the world (behind only Saudi Arabia). For this reason, Canadian dollar has a strong positive correlation with oil prices.
Where is the game of oil?
According to his prediction, global oil production peak was sometime around the second half between 2000 and 2010 (now?). At this point the barrel Oil is pretty close to U.S. $ 100, but what can happen to whether this prediction is correct? Is likely to continue for a few hundred more …
Brain distribution 4 – Recently, a few presidents of major oil producing countries have announced their concern about the weak dollar U.S. and declared that they would change the price of oil in Euros instead of U.S. dollars. What do you think it can happen to the USD if the price of barrels of oil in Euros instead of U.S. dollars?
by a.anies
[http://www.trade-4x.blogspot.com]
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