Silver Market Morning

Gold Today –New York closed at $1,205.00 up $13.60 before Asia held it there. The euro recovered nearly a cent at $1.2336. In London’s the gold Fixing was set at $1,206.50 up $11.25 and in the euro, barely changed, at €975.75 up €0.275 while the euro was stronger at $1.2365 over 1 cent higher. Ahead of New York’s opening gold was trading in London at $1,205.90 and in the euro at €975.92.

Silver Today – The silver price closed at $16.41 up 12 cents, in New York. Ahead of New York’s opening it was trading at $16.43.

Gold _{(very short-term)} The gold price will consolidate in New York with a stronger bias, today.

Silver _{(very short-term)} The silver price will consolidate with a stronger bias in New York today.

Price Drivers

There were sales of 1.793 tonnes of gold from the SPDR gold ETF and sales of 0.42 tonnes from the Gold Trust on Monday. The holdings of the SPDR gold ETF are at 719.121 and at 162.37 tonnes in the Gold Trust. [Subscribe to www.GoldForecaster.com & www.SilverForecaster.com]

The oil price continues to fall and $60 is the next downward hurdle. Precious metals are now reflecting the much bigger picture of the world economy. There is also a noticeable drop in people’s confidence in governments since 2007. Outside of the U.S. this creates more uncertainty, instability but also a darkening picture in the future in the developed world, in particular, which is seeing its wealth move eastward along side of its gold sales.

Precious metals have always done well in such environments. We have always felt that gold had a very good long-term future, despite seeing lower prices that have now come to pass, but if gold continues to hold current levels it points to a short-term positive outlook as well.

We do note that in the U.S. there is a financial ‘comfort zone’ where low interest rates and a positive equity market combined with a moderate economic recovery continues to halt demand for precious metals there. But sales of gold from there have fallen to a trickle and are expected to stay there. This is not because of a neutral attitude to gold, but to gold held for short to medium profit gains have been sold out, leaving global gold supplies short of demand. We expect Asian demand for gold to continue to rise steadily.

What gold and silver investors should now note is the propensity of gold and silver to ignore both the oil price and the euro to dollar exchange rate. The Technical picture on gold is positive now. This is a departure from recent past behavior and a positive indication of the future.

But on the gold front another government is thought to be calling for the repatriation of its gold, Belgium. Note well, that all but Venezuela, among the nations that have called for the repatriation of their gold, belong to the developed world and more specifically the Eurozone!

Silver– The silver price will not be affected by its fundamentals. www.SilverForecaster.com

Kind Regards,

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