Silver Market Morning

Gold Today –New York closed at $1,388.70 up $10.0 on Wednesday. China opens today. London opened at the same level as New York’s close. It then Fixed at $1,386.25 up $9.00 and in the euro at €1,039.713 up €2.5 while the euro was slightly stronger against the dollar at €1: $1.3333. Ahead of New York’s opening gold stood at $1,386.35 and in the euro at €1,041.04.

Silver Today – Silver closed at $21.73, up 8 cents in New York yesterday. Ahead of New York’s opening silver stood higher at $21.83.

Gold _{(very short-term)}

We expect gold to consolidate around current levels again, in New York today.

Silver _{(very short-term)}

We expect silver to consolidate at current levels again, in New York today.

Price Drivers

Gold & Silver – We see the gold price wanting to go higher at the moment as speculators wait for the impact of Chinese demand on the gold & silver prices. This may not hit London and New York until Monday. We do not see speculators trying to squash the gold price anytime soon. More likely they will see profits on the upside.

The U.S. based gold ETF the SPDR was down by 1.151 tonnes of gold on Wednesday to 1,540.577 tonnes. This allowed the gold and silver price to consolidate more. While Friday is usually the most active day of the week in gold and silver markets, it may well mark time until the orders arrive from China. The selling of gold from the SPDR gold ETF have dropped considerably and while it looks like the selling has abated one needs to see the current pattern of no heavy selling extend for at least a week, to be sure.

As expected the smuggling of gold into India has jumped and is jumping, particularly out of Dubai. [Subscribe to our newsletters at www.GoldForecaster.com and www.SilverForecaster.com] The Nikkei Index in Japan continues to tumble having fallen almost 6% today. But now fears that Q.E. will be ‘tapered’ off in the U.S. are causing this mercurial, brutal fall in equity markets outside of the U.S. as U.S. interest rates begin to rise. We see the Yen now back stronger at 94.18 up from 102 against the $1 after the Bank of Japan began its huge quantitative easing program.

Undoubtedly the ‘carry trade’ is unwinding pulling funds out of emerging markets and back to the States [ The fall of the South African Rand, while deeply affected by strikes in the mining industry, is also helped by capital leaving there to close leveraged positions in S.A. debt]. But it is not impacting the U.S dollar as it continues to sink against the euro now at €1: $1.3338 to the dollar. We see this volatile uncertainty in so many markets continuing.

Silver – Silver’s is again waiting for a clear direction from the gold price.

Regards,

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