Silver Market Morning

Gold Today – Gold closed in New York at $1,572.50 down $6.50 on yesterday. In Asia and London it traded slightly higher at $1,575 ahead of the Fix in London which was set at $1,572.50 down nearly $5 and in the euro at €1,205.258 down nearly €7, while the euro was at €1: $1.3047 cents. Ahead of New York’s opening it traded at $1,574.90 and in the euro at €1,206.31.

Silver Today – Silver closed at $27.23 in New York yesterday. Ahead of New York’s opening silver stood at $27.40.

Gold _{(very short-term)}

Gold will consolidate around present levels, in New York today.

Silver _{(very short-term)}

Silver will consolidate around present levels, in New York today.

Price Drivers

Gold & Silver – A tiny amount of shares [o.oo3 of a tonne] was bought into the SPDR gold ETF yesterday, which had a neutral effect on the gold price, which struggled to break through the $1,580 level, which it must do to confirm change of direction of the gold and silver prices.

Asian demand overnight was good, which is why the gold price rose ahead of London’s opening, only to be pulled back slightly ahead of the Fix. [Subscribe to our newsletters at www.GoldForecaster.com and www.SilverForecaster.com]

With respect to George Soros’ opinion that gold has been disappointing as the ultimate safe haven, there appears to be a misconception as to what this means. India has the right concept regarding this aspect of gold. Indian investors have been buying gold non-stop for many decades when the price was low and when the price was high, since the day gold was $35 an ounce. To them it is financial security, money and a ‘safe haven’. In developed markets where traders and speculators focus on short-term profit and where currencies move against the price of gold too, short-term it may well disappoint, on a trading basis. It is a ‘safe haven’ when the long-term protection against extreme times is considered. Cypriot deposit holders wish they had held gold. Zimbabweans, Argentineans and the Japanese today can see how gold did and is acting as a safe-haven for them.

With the Eurozone clambering through a recession and some parts through a depression with government bonds and banks facing extreme times gold is a ‘safe-haven’.

So we should not confuse a ‘safe-haven’ with a price that rises constantly. On that definition all investments are disappointing at some time or another.

If we look forward into the dark clouds that are being seen in the currency world longer-term gold will be the ultimate ‘safe haven’. That’s precisely why central banks are buying it!

Silver – Silver bounced off long-term support less than gold, but should match gold’s performance in the ‘shunt effect’ we expect now.

Regards,

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