Gold Seeker Closing Report: Gold and Silver End Modestly Lower

The Metals:

Gold fell $21.40 to $1716.50 by a little after 4AM EST before it climbed back higher in London and New York, but it still ended with a loss of 0.53%.Silver slipped to as low as $33.051 before it also climbed back higher, but it still ended with a loss of 1.18%.

Euro gold rose to about €1317, platinum lost $7.10 to $1609.50, and copper fell 5 cents to about $3.83.

Gold and silver equities fell over 2% in the first hour of trade before they rebounded in late morning action, but they still ended with about 1% losses.

Spring Festival sparks a 'gold rush' in China ChinaDaily

China gold sales up 57.6% during first week of Dragon Year BullionStreet

The Economy:

Texas factory activity picked up in January, Dallas Fed says Dallas News

Robert Shiller: A Housing Bottom? What Are They Thinking? Yahoo

Construction Rises as Architects Show U.S. Nonresidential Bounce Bloomberg

Plosser Says Fed May Need to Raise Rates Bloomberg

Tomorrow brings the Employment Cost Index, the Case-Shiller 20-city Index, Chicago PMI, and Consumer Confidence.

The Markets:

Charts Courtesy of http://finance.yahoo.com/

Oil fell and the U.S. dollar index rose as the euro dropped on disappointment over the lack of a deal for Greece over the weekend.

Treasuries rose as the Dow, Nasdaq, and S&P fell on renewed worries about European debt, but the major indices cut into most of their early losses by the close.

“European leaders struggled to reconcile austerity with growth on Monday at a summit due to approve a permanent rescue fund for the euro zone and put finishing touches to a German-driven pact for stricter budget discipline.

Officially, the half-day summit was meant to focus mainly on ways to revive growth and create jobs at a time when governments across Europe are having to cut public spending and raise taxes to tackle mountains of debt.

But disputes over the limits of austerity, and about Greece's unresolved debt restructuring negotiations with private bondholders, may sour efforts to send a more optimistic message that Europe is getting on top of its debt crisis.”

Among the big names making news in the market today were Facebook, MF Global, ABB and Thomas & Betts, and TonenGeneral and Exxon Japan Refining.

The Commentary:

“Gold is coming under a bit of selling pressure in New York after opening higher in Asia alongside of silver last evening. Both markets then saw selling originating in the form of both profit taking and new short positions (from top pickers) after traders' attentions turned back to the sovereign debt woes in Euroland, particularly Greece.

Also there was a bit of news that China was not going to be in a hurry to loosen the monetary strings as quickly as some were anticipating.

Either way, it led to a reversal of the recent risk trades in favor of the safe havens once again with the bonds getting a strong bid (they are now over a full point higher) so much so that the yield on the Ten Year Note is currently 1.84%. You have to understand that a great deal of these FOMC shenanigans have but one true purpose beyond the obvious ploy to keep the stock market propped up during an election year and that is to ATTEMPT TO PUSH BORROWING COSTS FOR THE US GOVERNMENT LOWER.

The fiscal condition of the US is so abysmal that rising longer term interest rates will send the deficit soaring even higher due to the escalation of servicing its gargantuan debt load. While this government-sanctioned mugging of savers and retirees continues, the US gets to borrow its trillions at extremely low rates, rates which otherwise would force a much larger chunk of its revenue to go towards paying higher borrowing costs.

It seems to me that the Gold market is seeing through all of this mess as it saw good buying below $1720 this morning. Bulls are reluctant to push it higher in today's trading session and are not chasing it but they do seem willing to step in down at these slightly lower levels. With some of the momentum indicators in overbought territory, some have decided to book a few profits out of the nice rally and see what their next move will be.

Any reversal higher in equities later in the session or a continuation of the recent Euro rally will see a rather swift bout of short covering occur in gold. We'll have to see whether or not we get that. In the meanwhile, the bears have the advantage for today's session as selling is being seen across nearly the entirety of the commodity complex with energy, grains and metals all lower.”- Dan Norcini, More at http://www.traderdannorcini.blogspot.com/

GATA Posts:

Spring festival sparks a gold rush in China

Lehrman calls on Republicans to unite on 'sound dollar' platform

Mike Kosares: Survivalist George Soros

Alasdair Macleod: FEDging the figures

The Statistics:

Activity from: 1/27/2012

Global Gold ETF Holdings

[WGC Sponsored ETF’s]

Note: Change in Total Tonnes from yesterday’s data: SPDR added 9.977 tonnes.

COMEX Gold Trust (IAU) Total Tonnes in Trust: 174.03: No change from yesterday’s data.

Silver Trust (SLV) Total Tonnes in Trust: 9,510.70: No change from yesterday’s data.

The Miners:

SEMAFO’s (SMF.TO) 2012 outlook, Gold Resource’s (GORO) 2011 results and 2012 outlook, and Keegan’s (KGN) new CEO were among big stories in the gold and silver mining industry making headlines today.

WINNERS

LOSERS

Winners & Losers tracks NYSE and AMEX listed gold and silver mining stocks that trade over $1.

Please see Yahoo’s Mining/Metals News Wire for all of today’s mining news.

- Chris Mullen, Gold Seeker Report

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• http://www.capitalupdates.com
• http://www.goldseek.com
• http://www.silverseek.com
• http://www.goldreview.com

©Gold Seeker 2012

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