Silver Market Morning

Gold Today –New York closed at $1,191.70 down $1.20, yesterday. Asia saw it fall to $1,182 ahead of London’s opening with London then taking it down a dollar. The LBMA Gold price was set at $1,183.00 down $8.25 on yesterday. The euro equivalent stood at €1,041.92 down €20.19 while the dollar was weaker at $1.1351 down from $1.1211 against the euro. Ahead of New York’s opening, gold was trading slightly higher in London at $1,183.50 and in the euro at €1,042.46.

Silver Today – The silver price closed at $16.50 down 4 cents on yesterday’s level. Ahead of New York’s opening it was trading at $16.27.

Gold _{(very short-term)} The gold price should consolidate, in New York today.

Silver _{(very short-term)} The silver price should consolidate, in New York today.

Price Drivers

The dollar continues to slip today with the dollar index now at 94.07 against yesterday’s 94.81, and the dollar slipped to $1.1347 from yesterday’s $1.1233. There were no purchases or sales of gold into the SPDR gold E.T.F. but there were purchases into the Gold Trust of 0.56 of a tonne yesterday. The holdings of the SPDR gold ETF are still at 741.750 tonnes and at 166.14 tonnes in the Gold Trust. The dollar’s fall and the rise of the euro is now not only because of the news on the U.S. Trade deficit but on Janet Yellen’s statements too. Foreign Treasury holders understood that a sell-off in U.S. markets would affect them on the dollar front too. This may well remove hopes of higher levels in both bond and equity markets in the foreseeable future? Subscribe www.goldForecaster.com

We are starting to see the world’s markets synchronizing much more now than ever before. The statement from Janet Yellen, Chairlady of the Fed, that equity markets were high, set off alarm bells all over the world’s markets. She is aware that when prices of both bonds and equities are far ahead of prospective profits and being driven up by investors seeking yield and not prospects, they are vulnerable to a crash. Translated this means that markets are in ‘bubble’ territory. The subsequent sell off across the globe may well continue. Why did she make this statement? To us it is an attempt to pre-empt a major sell off once interest rates begin rising. The Fed’s greatest fear is that once they begin raising rates markets will overreact. So expect more of such statements.

This does not explain the $10 drop in gold in China or does it? Dealer’s lower prices if they expect be met by sellers because of Janet Yellen’s comments, across the world. This marking down of prices could change in a heartbeat, once any potential selling is completed. But we must be careful not to see too much in these small moves, because Chinese demand will remain unabated.

Attempts to drive gold and silver prices down continue but have been frustrated by Asian demand. This frustration is likely to continue as west battles east on this subject, but once a clear direction is determined we could see 2015 producing one of gold and silver’s most exciting years.

Silver– Silver prices have a strong foundation. Subscribe www.SilverForecaster.com

Regards,

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