Gold
Most currencies fell against gold yesterday and again today as
the euro and dollar are under slight pressure this morning. Both
gold and silver look set to finish the week slightly lower in
dollars and most currencies (except the euro) which is a bearish
short term omen. Especially as the end of the year approaches and
there could be some year-end book balancing and profit
taking.
Gold is currently trading at $1,391.19/oz, €1,049.56/oz and
£878.35/oz.
!["click](http://www.ibtimes.com/"http://www.goldcore.com/images/mu/goldcore_bloomberg_chart1_10-12-10_small.png")
Most bond markets recovered yesterday and saw yields fall
slightly, except for those of Spain and Japan. Credit default
swaps, the cost of insuring against sovereign debt default,
widened in Ireland, Italy, Spain and Portugal. There is a
continuing state of denial regarding the Eurozone sovereign debt
crisis and the real and growing risk of contagion and of Eurozone
members leaving the monetary union (see Euro Gold Chart and News
below).
The dollar may come under pressure today as the US trade and
federal budget balance data will remind market participants of
the precarious US fiscal position. The consumer confidence number
may also give guidance. The Chinese trade data showed a huge
surplus of $22.9 billion showing again how undervalued the yuan
is against the dollar.
!["click](http://www.ibtimes.com/"http://www.goldcore.com/images/mu/goldcore_bloomberg_chart2_10-12-10_small.png")
The fundamental supply and demand picture for gold remains
positive with anaemic supply and significant investment and
monetary demand from a wide range of sources including retail
investors, hedge funds, high net worths, pension funds and
central banks. This demand is more than capable of compensating
for the fall in jewellery demand.
Technically, gold is looking particularly well in euros. After
gains early in 2010, gold consolidated between €900/oz and
€1050/oz since May. The 100 day moving average has risen to
€975/oz and this or the recent level of support at €950/oz are
likely to provide support if there is a pullback. However, given
that there is an existential threat to the very survival of the
euro, any pullback will likely be shallow and brief. Far more
likely is a challenge of the €1,100/oz level in the coming
weeks.
!["click](http://www.ibtimes.com/"http://www.goldcore.com/images/mu/goldcore_bloomberg_chart3_10-12-10_small.png")
Similarly, sterling had been in a range and consolidated
between £740/oz and £875/oz since last March. Gold recently broke
above the range and rose to a new nominal high of £905/oz. The
100 day moving average is at £827/oz and this is now support.
Resistance is at the recent nominal high of £905/oz and a close
above this level could see us challenge £950/oz in short
order.
Silver
Silver is currently trading $28.83/oz, €21.75 /oz and
£18.20/oz.
Platinum Group Metals
Platinum is currently trading at $1,678.50/oz, palladium at
$740.00/oz and rhodium at $2,225/oz.
News
(
AP
) -- GOLD REBOUND: Gold ticked higher as investors were in a
buying mood after prices slipped for two days. The precious metal
settled at $1,392.80 an ounce Thursday.
(Bloomberg) -- Gold, which reached a record this week, may
advance as investors seek an alternative to currencies, a survey
found. Nine of 16 traders, investors and analysts surveyed by
Bloomberg (including GoldCore), or 56 percent, said the metal
will rise next week. Four predicted lower prices and three were
neutral. Gold futures for February delivery were down 1.5 percent
for this week at $1,384.80 an ounce at 11:30 a.m. yesterday on
the Comex in New York. Futures reached a record $1,432.50 on Dec.
7.
(Bloomberg) -- The 5-ounce America the Beautiful silver coins
will go on sale tomorrow, the U.S. Mint said. Authorized
purchasers may charge consumers no more than 10 percent above the
price at which they bought the coins from the Mint, the agency
said today in a memo to dealers. The agency had delayed the sale
for four days to investigate consumer complaints over price
premiums. Only 33,000 coins are available in each of the five
designs, and authorized dealers may sell only one coin to each
household, the agency said. Silver futures in New York, up 71
percent this year, touched a 30-year high of $30.75 an ounce on
Dec. 7.
(Bloomberg) -- Silver fabrication demand in China may account
for 20 percent of global fabrication demand this year, New
York-based research company CPM Group said in a statement.
China's total silver demand has climbed almost 3.5 times in the
past decade, from 40.8 million ounces in 2000 to 139.2 million
ounces last year, CPM said in the statement e-mailed yesterday.
"CPM's work indicates that silver use is roughly twice as large
as had been suggested by commentators in the western market," CPM
said.