Thursday, May 23, 2013

6 Reasons Why Gold Stocks Will Begin A Big Rally


1. Huge rallies begin from these conditions

Below is the NYSE Gold Miners Index which is tracked by the GDX ETF. Look at the RSI. Not only did it reach a multi-decade low but it has remained oversold far longer than during the comparable periods. In the four previous periods, the market rebounded suddenly and strongly in percentage terms. Meanwhile, the bullish percent index, a breath indicator is more oversold than in 2008. We plot the indicator with a 10-week moving average that shows it as far more oversold than in 2008. While this indicator does not go back that far, odds are it is likely at a 13-year low.

Wednesday, May 22, 2013

Gold: New Resistance Found At 1,382

By Mingze Wu  

USD enjoyed gains yesterday after 2 Fed officials, James Bullard and William Dudley, lent support to current QE purchase program, with Bullard saying that the Fed should continue its current program, and Dudley going one up and suggest that the Fed may adjust pace of asset purchases higher depending on the economic outlook. US stock rallied higher as the 2 aforementioned Fed members held voting rights, unlike the 2 Fed members John Williams and Charles Plossers who were rather vocal recently on their unhappiness over the QE program and want it to be shut down sooner rather than later.

Gold prices traded sharply lower during US trading session, showing once again that the yellow metal is driven by USD strength and not on QE inflation risks. This is a long known fact, but perhaps it is a timely reminder especially given that Ben Bernanke will be speaking later this evening (morning US hours) with regards to QE in Congress. Should Ben Bernanke maintain his dovishness tonight, it is likely that stocks will continue to rise, pulling USD along with it hence making Gold lower. However, if Ben choose to be hawkish (unlikely), there remains an outside chance that USD would still strengthen due to expected lower liquidity in the future, which would again drive Gold lower. This makes tonight’s event leaning favorably for Gold bears.

Hourly Chart


Monday, May 20, 2013

Gold and Silver Prices Outlook for May 20-24

Gold and silver continued to trade down during last week. Their sharp fall coincided with the depreciation of leading “risk related currencies” such as Euro and Aussie dollar against the USD. Moreover, the ongoing rally of U.S equity markets is also contributing the decline in demand for bullion as an investment.  Last week, U.S retail sales edged up by 0.1% during April. On the other hand, Philly Fed index fell in May; housing starts sharply fell by 16.5% in April; jobless claims sharply increased by 32k to reach 360k; the PPI fell again by 0.7% during last month.  

Will gold and silver continue to trade down this forthcoming week?  

Sunday, May 19, 2013

Gold Survey: Weaker Gold Prices Expected Next Week

A stronger dollar and continued strong equities are expected to weigh on gold prices next week, with a majority of participants in the Kitco News Gold Survey forecasting weaker prices.

In the Kitco News Gold Survey, out of 36 participants, 28 responded this week. Of those 28 participants, nine see prices up, while 17 see prices down and two see prices moving sideways or are neutral. Market participants include bullion dealers, investment banks, futures traders, money managers and technical-chart analysts.

Bull Market Ended?

Has the Silver and Gold Price Bull Market Ended?

Silver and GOLD PRICES were humiliated again today. Silver dipped 30.4 cents to 2233.9c. Gold dove $22.20 to $1,364.90. No sign yet of turning round.

However, silver's lows yesterday and today ran about 2206c (different charts give different figures). That's enough to call it a double bottom with the 2200c low on 15 April, but not enough to say it won't drop lower. It will have to show that next week.

Saturday, May 18, 2013

Paper Gold, Metal Gold – When Worlds Diverge.

by Golem XIV 

The price of gold is going down. That is what the charts, newspapers and pundits are all saying. What I think they are deliberately not saying is that the value and desirability, as opposed to the price of gold, is going up and will go up further.

Make no sense?  Well I think it does if you remember there are two types of ‘gold’ for sale. One is metal, the other is paper. It is paper gold that is being dumped not the metal. The metal is being bought at a fair old rate. But because there is so much paper gold around and the major sellers and market makers in paper gold prefer metal and paper to be confused, even thought to be identical (their trade depends on this confusion), no one seems to be pointing out the very different dynamic happening in paper and  metal gold.

Friday, May 17, 2013

Gold And Silver ~ Weekly Recap for May 13-17

weekly precious metals chart   May 13-17 2013

Despite the less than impressive financial news regarding the progress of the U.S economy that came out during last week the equity market continued to rally, while gold and silver prices declined. Last week, the U.S retail sales inched up by 0.1% during April. On the other hand, Philly Fed index decline in May; housing starts sharply fell by 16.5% in April; jobless claims sharply increased by 32k to reach 360k; the PPI fell again by 0.7% during last month.  In the currencies markets, during the previous week, the Euro and Aussie dollar tumbled down against the USD by 1.15% and 2.94%, respectively. Their sharp fall might have partly contributed to the plunge in precious metals prices.

Here is a short recap of the developments in precious metals prices between May 13th and May 17th:

Precious Metals Recap:  
table weekly gold and silver  prices   May 13-17 2013

Gold price tumbled down during last week by 5%; moreover, during the week, the average weekly price reached $1,401.32 /t. oz which was 3.96% below last week’s average rate of $1,459.14 /t. oz. Gold ended the week at $1,364.7 /t. oz.

Silver, much like gold, sharply fell during last week by 5.5%; further, the average weekly rate decreased by 3.76% to reach $22.94/t oz compared to last week’s average $23.83/t oz.

During last week, the average daily percent changes of gold reached -1.019%; silver had an average daily change of -1.118%.

The chart below presents the changes of precious metals, as their rates are normalized to 100 as of May 10th. Gold and silver prices sharply declined during last week.

weekly precious metals chart  May 13-17 2013 percent change

The second chart presents the daily percent shifts of bullion prices (or in other words the changes around the trend). Silver and gold declined during the week. Precious metals prices daily percent changes ranged between 0.16% gain and 3.05% drop.


Thursday, May 16, 2013

Gold Retail Sales In India Swell 15%

Gold sales are expected to have crossed 25 tonne in volume terms in India on Akshaya Tritiya this year, as compared to 17 tonne last year.

MUMBAI (Mineweb) 

Akshaya Tritiya, the biggest gold buying festival in India, triggered a mad rush for the precious metal on May 13. Jewellers in Mumbai reported a double-digit jump in sales over last year, with customers showing a strong preference for heavy, thick-set ornaments, gold bars and coins.  

Initial estimates from the industry have pegged sales at around 4 tonne in the island city of Mumbai alone, while in Kolakata, gold weighing about 500 kilo was sold in 3 hours flat on the auspicious day.

Across Mumbai, though jewellery stores were closed all of last week, opposing the Local Body Tax to be imposed in the city, most of the stores opened up early on Monday, decked with marigold flowers and twinkling lights.

Sunday, May 12, 2013

US Dollar Strength, Economic Data May Influence Gold

Gold price direction next week is likely to be influence by the strength of the U.S. dollar, along with U.S. economic data on manufacturing, retail sales and inflation.

June gold futures fell Friday, settling at $1,436.60 an ounce on the Comex division of the New York Mercantile Exchange, down 1.89% on the week. July silver slipped Friday, settling at $23.658 an ounce, down 1.48% on the week.

In the Kitco News Gold Survey, out of 36 participants, 25 responded this week. Of those 25 participants, eight see prices up, while 11 see prices down and six see prices moving sideways or are neutral. Market participants include bullion dealers, investment banks, futures traders, money managers and technical-chart analysts.

Friday, May 10, 2013

Gold Futures Sink As U.S. Dollar Soars

BNP cuts gold view, but says $1,600 will be reached again

MADRID (MarketWatch) — Gold futures fell sharply on Friday, as the U.S. dollar extended its rally against the Japanese yen.

BNP Paribas cut its gold price view, but said the metal will be trading back above $1,600 an ounce in six months.

June gold futures GCM3 -2.83%  fell nearly $40, or 2.7%, to $1,428.70 an ounce on the Comex division of the New York Mercantile Exchange.

Monday, May 6, 2013

Gold and Silver Prices Outlook for May 2013

Gold and silver prices tumbled down during April.  The minutes of the FOMC meeting may have been the trigger for the sharpest fall in the prices of bullion in a single day in recent decades. The rise in volatility of gold and silver prices in recent weeks may have been the main reason for the CME to raise on April 15th its margins on gold and silver by 19% and 18.5%, respectively. This decision may have been the key factor in pulling down the prices of gold and silver on April 15th. This tactic of raising margins was done in past including in 2011 when gold and silver sharply increased. 


The decision back then pulled down the prices of gold and silver as was the case on April 15th. Other contributing factors may have been the negative report of Goldman Sachs about gold, and the slowdown in growth in China – among the leading countries in importing gold and silver. Even the ongoing rise in the U.S money base, partly due to the FOMC’s QE3 program, doesn’t seem to help rally gold and silver prices. Will gold and silver continue to dwindle during May? Let’s analyze the precious metals market for April and provide a short outlook for gold and silver for May.

Sunday, May 5, 2013

Gold and Silver Prices Outlook for May 6 -10

Gold and silver slightly rose during last week. Their rally coincided with the recovery of other commodities such as oil and leading “risk related currencies” such as Euro and Aussie dollar against the USD.  Last week, the FOMC and ECB decided on any changes to their respective monetary policy. The ECB decided to cut its interest rate by 0.25pp to 0.5%. The FOMC kept its policy unchanged including its $85 billion a month asset purchase program. 

Nonetheless, the speculation around the next move of the Fed may have pulled bullion rates into different directions. The recent non-farm payroll report didn’t seem to stir up much bullion market despite its better than expected gain in employment. 

Will gold and silver continue to recover this upcoming week?  

Friday, May 3, 2013

Chinese Mothers Beat Wall Street To Force Gold Price Rebound

Attempts by Wall Street funds to drive down bullion value through short selling thwarted by Asian mothers swooping in to buy for weddings.

Enoch Yiu and Daniel Ren in Shanghai

Gold prices are rising again as Asian mothers take advantage of the recent weakness in the price to buy jewellery. 

Chinese mothers have beaten Wall Street hedge fund managers in forcing a turnaround in the price of gold after it dropped last month.

Taking advantage of the steepest drop in three decades, they have shored up prices by splashing out on gold for their daughters' weddings in the past couple of weeks, foiling the plan of finance gurus who have been short selling the precious metal in the hope of pushing it lower.

Thursday, May 2, 2013

Gold Bull Run Seen Over as Bear Drop Frays Faithful

Gold’s longest winning streak in at least nine decades is poised to end as diminishing trust in the metal’s ability to preserve value spurred a majority of analysts to predict the first annual retreat since 2000.

Prices will close the year at $1,550 an ounce, 7.5 percent less than at the end of 2012 and the biggest drop since 1997, according to the median of 38 estimates compiled by Bloomberg. Investors are selling bullion held through exchange-traded products at the fastest pace on record, hedge funds accumulated their second-biggest bearish bet ever and futures had their biggest two-day drop in 33 years last month.

Gold futures spike to session highs after Draghi, ECB rate cut

Gold futures rose sharply on Thursday, hitting the highest level of the session as the European Central Bank cut interest rates to a record low in May.

Prices also remained supported after the Federal Reserve re-affirmed its commitment to leave interest rates unchanged near zero and continue buying USD85 billion in debt each month on Wednesday.

Gold can benefit from such an environment of easy money because of expectations that ample liquidity would put a damper on the value of paper currencies.

Silver and Gold Prices Both Fulfilled Yesterday's Suspicions by Dropping Today

Silver and GOLD PRICES both fulfilled yesterday's suspicions by dropping today. Gold slumped $25.90 to $1,446.30 while the SILVER PRICE backslid 83.9 cents to 2330.5c.

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