• Gold: 1,570.86 -0.86
  • Silver: 18.07 -0.03
  • Euro: 1.102 -0.001
  • USDX: 97.884 0.197
  • Oil: 54.35 -1.3

Silver Market Morning

Julian D. W. Phillips
Friday, October 31st

Gold Today – The gold price closed at $1,198.70 down $12.50 on Thursday. Asia and London took down to $1,174. The euro is weaker this morning at $1.2560 on the day. The Fix was set $1,173.25 down $32.50 and in the euro at €933.447 down €24.638, while the euro stood weaker at $1.2569. The volumes of gold traded were two sellers selling 58,000 ounces and one buyer buying 38,000 ounces before the pro-rata process kicked in. Ahead of New York’s opening, gold was trading at $1,774.1 and in the euro at €933.64.


Silver Today – The silver price closed in New York at $16.49 down 58 cents. Ahead of New York’s opening it was trading at $16.15.


Gold (very short-term) Gold is likely to look for a bottom, in New York, today.


Silver (very short-term) Silver is likely wait for gold to find a bottom, in New York, today.


Price Drivers

In New York there were sellers of 1.196 tonnes of gold from the SPDR gold ETF once again and a sale of o.36 from the Gold Trust on Thursday. The holdings of the SPDR gold ETF were at 741.201 tonnes and in the Gold Trust at 161.33 tonnes today.


Traders and speculators have driven the gold price down by nearly $60 from above support at $1,180. This is clearly an attempt to hurt the Technical picture hoping to trigger protective stops to make it go lower. Will Asian demand rush to get hold of these bargain prices. Next week could decide gold’s next direction.


It is questionable that developed world markets can drive the prices much lower on the small volumes they see pass over their counters. As a buying opportunity for Asian demand these levels are very inviting.


Turning to the gold miners themselves these prices are going below their break-even points. Where possible these miners will turn to their higher grade reserves to keep profitable, but for others such prices are ‘tolling a bell’ if they continue. There are some miners out there that remain profitable at even lower levels. Investors should be looking for these.


Remarkably, Alan Greenspan recently said recently, “that gold is a good place to put money these days given its value as a currency outside of the policies conducted by governments”. This was not a short-term statement but clearly looked forward.


While the euro is still falling [$1.2566] its pace of fall has slowed considerably. As of now it is trying to recover some ground and gold has stopped falling for now. Higher inflation [of o.4% for September] in the E.U., is being taken as good news. But this distracts from some key fundamentals for gold that we should not forget. First gold and the euro have no common denominators except the traders move gold in the opposite direction to the dollar. Secondly with the world east of Greece taking what looks to be close to 90% of the world’s gold supply, the gold price is not reflecting this. Thus demand/supply factors are not being factored into the gold price, implying an ineffective pricing system at best. [Get the bigger picture - Subscribe to www.GoldForecaster.com & www.SilverForecaster.comto protect against confiscation and penalties -see www.Stockbridgemgmt.com ]


Silver– Silver prices dropped heavily alongside gold and will still follow gold, wherever it goes. www.SilverForecaster.com


Kind Regards,


Julian D.W. Phillips for the Gold & Silver Forecasters


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