Silver Market Morning: September-18-2015

September 18, 2015

Gold Today –New York closed with the gold price at $1,131.30 up $11.60 from $1,119.70. Gold then rose in Asia and London to see the LBMA gold price set at $1,136.00. In the euro this was €992.49 up €1.33. This morning the dollar index started the day at 94.11 a full 1.15 points lower from yesterday’s 95.26. Ahead of New York’s opening gold was trading at $1,139.10 and in the euro at €997.94.

Silver Today – The silver price closed at $15.11 up 20 cents on yesterday in New York. Ahead of New York’s opening silver was trading at $15.31.

Gold _{(very short-term)} The gold price is soon to have a strong move either way, in New York.

Silver _{(very short-term)}The silver price is soon to have a strong move either way, in New York.

Price Drivers

Yesterday’s rise was not the strong move we are waiting for as it is within the trading range we expected to see for the gold price. Overhead resistance is at $1,140.

While the rate hike discussion gave relief to the emerging world and confirmed that the U.S. consumer still needs to get to a financially robust position, it gave gold investors a great deal of insight into the direction of gold and silver. We expect the U.S. equity market and the bond market to rally, but to fall back subsequently.

Janet Yellen made clear U.S. concerns over the global economy and, as we said earlier in the week, its impact on the U.S. economy. But gold is not subject to local phenomenon, it is international in its value. If it is to rise in the dollar then it will rise in all currencies as most currencies will continue to try to fall against the dollar. When we saw the G-20 agreement not to indulge in competitive devaluations we knew that, as followed the last agreement not to do so, it was a signal for such devaluations to accelerate. What we expect to see now is not simply competitive devaluations but to see justification for such as a means of ‘defense’.

The impact will be seen from the emerging world, on the dollar exchange rate. While the dollar is still only in the mid-way of a bull market, its potential rise is not wanted by the Fed or the Treasury. To us this is sufficient to know that they will arrest this bull market in the dollar. As we see today the dollar is now falling and the ‘carry trade’ comfortable with holding their positions as they are now. With U.S. investors seeing gold as moving the opposite way of the dollar, this is gold positive. With the gold ETFs in the U.S. still to react fully to the Fed statement we saw no dealings in the SPDR gold ETF but did see a 0.60 of a tonnes sale in the Gold Trust yesterday. This again leaves the holdings of the SPDR gold ETF at 678.183 tonnes and 159.30 tonnes in the Gold Trust. [More on this in our newsletter - Subscribe www.goldForecaster.com [See a site where protection is offered for gold owners: www.Stockbridgemgmt.com ]