Silver Market Morning: May 02 2017 - Gold is consolidating!

Many may think the gold price reflects demand and supply of physical gold. It doesn’t. It primarily reflects marginal supply and demand, speculative activity and the assumptions of the main dealers as to where the market is going. The physical demand and supply of gold is mainly directly contracted between physical buyers and sellers, with the contract price, primarily the London pm price setting, but for a growing number of market professionals the Shanghai gold Fix is being used by both parties to the contract. In other words the trading in physical gold, in the case of around 95%+ of such buyers and sellers, does not influence the gold price.