Silver Market Morning: Nov-21-2016 -- Gold and Silver bounce start to bounce off support!

Gold Today –New York closed at $1,208.30 Friday after the previous close of $1,218.40 London opened at $1,215 then rose in London’s morning to be in line with Shanghai.

- The $: € was a much weaker at $1.0626: €1 from $1.0597: €1 Friday.

- The Dollar index was a weaker at 101.11 from 101.25 Friday.

- The Yen was weaker at 110.84: $1 from Friday’s 110.67 against the dollar.

- The Yuan was much weaker at 6.8967: $1 from 6.8984: $1 Friday.

- The Pound Sterling was weaker at $1.2331: £1 from Friday’s $1.2389: £1.

Yuan Gold Fix

Please note that the Shanghai Fixes are for 1 gm of gold. From the Middle Eat eastward metric measurements are used against 0.9999 quality gold. [Please note that the 0.5% difference in price can be accounted for by the higher quality of Shanghai’s gold on which their gold price is based over London’s ‘good delivery’ standard of 0.995.]

Once again, allowing for the difference in the quality of gold priced in the different markets, Shanghai gold prices Fixed gold prices in the morning and the afternoon much higher that New York’s close in the ‘20s not below ‘10 pushing for pricing dominance once more. The dollar is lower and stable at the beginning of this week, but may well try to rise again. Once again it is the dollar’s strength that is making global market prices in currencies and precious metals alongside selling action in the gold ETFs.

LBMA price setting: The LBMA gold price setting was at $1,214.95 against Friday’s $1,206.10. The gold price in the euro was set higher at €1,143.59 against Friday’s €1,148.29.

Ahead of the opening of New York the gold price was trading at $1,214.65 and in the euro at €1,143.36. At the same time, the silver price was trading at $16.69.

Silver Today –Silver fell to $16.58 at New York’s close Friday from $16.95, Thursday.

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

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

Price Drivers

If the gold price can hold around current levels above $1,210 this week we could see volatility and prices move to the upside. This is despite the Fed Chair’s words indicating that a rate hike is likely in December.

As we see President elect Trump put right wingers in positions of power we say that we see these being gold & silver positive. We are apolitical so will not comment on policies! Our job is to assess the important factors, including currencies, that affect gold and silver prices in the short, medium and long term.

As the dust continues to swirl around the future we see U.S. gold investors, through their selling gold from the gold ETFs, discounting an expected future under Trump. From his statements during the election [and his appointments so far] he is telling us that he is going ahead with his election promises. This provided the gold and silver market in the U.S. with long term fundamental support. But we will have to see his actions before we see U.S. investors run back to gold for short term gains. Long term U.S. investors may well return much earlier to the gold and silver markets as globally, as fundamental conditions remain good for gold and silver demand and prices.

With the demand for gold from the Muslim community to get a boost in December from the exposure report on Shariah gold we may see a major new factors considerably increasing gold demand. If that happens, gold and silver demand east of Greece will jump significantly. With gold demand east of Greece reaching between 74% and 85% of global supplies at the moment, or more, pricing power will inevitably move to Shanghai with London in second place.

So gold is not down and out, simply on the back foot at present, but, we feel, not for long. [We will discuss this in depth in future issues of the Gold Forecaster for subscribers!] - Subscribe - GoldForecaster.com - To ensure you can benefit from the future higher gold prices we will see then, you need to hold it in a manner that makes sure it can’t be taken from you. Contact us at admin@stockbridgemgmt.com to buy physical gold in a way that we feel, removes the threat of it being confiscated. We’re the only storage company that offers that!

India The ongoing cash crunch in India has hit the economy far harder that thought, last week. Crops are not being planted, because there is not enough cash for wage paying. Over 80% of the country does not have banking facilities of any kind. Wherever wages are paid in cash, industries are grinding to a halt. You cannot extract over 80% of cash from an economy based on cash suddenly and expect the economic engine to continue unharmed. When it is likely to take far more that 50 days to rectify the cash shortage, do not expect the population to flip into cell-phone banking or to credit cards and checks. And yet that is what the Finance ministry is hoping will happen. They completely underestimated the impact of their actions and were ill-prepared for the actions.

All in all given the attitudes of the Indian population demand for gold to be held ‘out of sight’ [purchased the same way and from smugglers] demand will jump strongly. We believe that process is now well under way! We do not expect the government’s actions to succeed in halting the ‘black money system.

Gold ETFs – There were sales of 5.338 tonnes of gold from the SPDR gold ETF and sales of 1.20 of a tonnes from the Gold Trust Friday, leaving their respective holdings at 915.288 tonnes and 207.72 tonnes.

Since January 4^th this year, 321.999 tonnes of gold has been added to the SPDR gold ETF and to the Gold Trust.

Silver –Silver continues to be volatile to the downside and will now wait for gold to bounce strongly, before silver investors get back into the market. We continue to see the dollar’s rise as the main influence on both gold and silver right now.

Regards,

Julian D.W. Phillips

GoldForecaster.com | SilverForecaster.com | StockBridge Management Alliance [Gold Storage geared to avoid its confiscation]

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