Gold Seeker Closing Report: Gold and Silver Rise With Oil

The Metals:

Gold climbed $11.50 to $1677.40 in London before it fell back to $1666.30 by a little after 9AM EST, but it then rallied to a new session high of $1681.40 by late morning in New York and ended with a gain of 0.73%.Silver surged to $32.772 in London before it fell back to $31.899, but it then bounced back higher and ended with a gain of 0.65%.

Euro gold fell to about €1287, platinum gained $28.20 to $1559.00, and copper gained 5 cents to about $3.79.

Gold and silver equities rose about 1.5% in the first half hour of trade and remained near that level for the rest of the day.

The Economy:

Bernanke near inflation target prize, but jobs a concern Reuters

Obama Paying Bush Interest Limits Debt Debate Bloomberg

Tomorrow at 9PM EST brings the State of the Union speech.

The Markets:

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

Oil rose after the EU agreed to ban imports of Iranian crude.

EU bans Iranian oil, Tehran responds with threats Reuters

EU imposes ban on Iranian crude-oil imports MarketWatch

U.S. oil production to surge on shale output: EIA Reuters

The U.S. dollar index and treasuries fell as the euro rose on optimism over a debt deal for Greece.

Greek bondholders have made their best offer MarketWatch

The Dow, Nasdaq, and S&P traded mixed on apprehension about this week’s FOMC meeting.

Among the big names making news in the market today were Chesapeake, Toyota, Apache, RIM, Halliburton, and JPMorgan.

The Commentary:

“One look at this tells you all you need to know about whether or not silver is going to perform. If risk is in and hedge fund money flows are coming into the commodity complex in general, it will move higher. When it does, silver goes right along with it.

When risk is out and money flows OUT of the commodity complex, silver sinks like a lead brick.

Notice that chart pattern is almost identical between the two.

You will note on this chart that since Silver peaked near $50 back in April of last year, gold had generally been outperforming it for the remainder of the year. I am of the opinion that this was due to the anticipation of the end of QE2 in June of last year. Traders began preparing for the loss of the liquidity being supplied from that front. When you couple this with the fact that European sovereign debt woes began to gain ascendancy in the minds of traders worldwide, it is easy to see why gold held up better than silver. DEFLATION was back in; INFLATION was out.

If, and this is a big "IF", traders become convinced that deflationary forces have been left behind, then the environment in which the grey metal will outperform the yellow metal is created. In such a case, this ratio will begin trending LOWER as silver outperforms.

Every single bit of this is dependent on the attitude of traders towards risk, which is simply another way of saying whether they are leaning more towards improving global growth prospects and inflation rather than slowing global growth and deflation.

Stay tuned as the environment is still very volatile. For this week at least, the inflationary (risk trade) forces have won the battle.”- Dan Norcini, More at http://www.traderdannorcini.blogspot.com/

GATA Posts:

EU won't trade gold with Iran anymore; could it really still be money after all?

Gold to keep rising until real rates go positive, Sprott's Franklin tells MineWeb

'Gold can't be faked,' Mr. Zhang? Ever hear of the LBMA, JPMorganChase, and the Fed?

Gold-market rigging has many whistleblowers; they're just always ignored

Arensberg laments PSLV premium; new Gold Standard Institute letter is published

Fed would admit devaluation is policy, then keep underestimating it

The Statistics:

Activity from: 1/20/2012

Global Gold ETF Holdings

[WGC Sponsored ETF’s]

Note: No change in Total Tonnes from yesterday’s data.

COMEX Gold Trust (IAU) Total Tonnes in Trust: 174.03: +0.85 change from yesterday’s data.

Silver Trust (SLV) Total Tonnes in Trust: 9,516.75: No change from yesterday’s data.

The Miners:

Tanzanian Royalty’s (TRX) assay results, Banro’s (BAA) exploration results, IMPACT Silver’s (IPT.V) exploration review and outlook, Pan American’s (PAAS) acquisition of Minefinders (MFN), Paramount’s (PZG) drill results, SilverCrest’s (SVL.V) updated summary of its corporate mineral resources, Excellon’s (EXN.TO) production and exploration updates, and Alexco’s (AXU) production increase 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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Additional Resources for today’s Gold Seeker Report can be found:

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

©Gold Seeker 2012

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