• Gold: 1,201.29 -0.02
  • Silver: 16.43 -0.06
  • Euro: 1.239 -0.000
  • USDX: 88.279 0.638
  • Oil: 76.66 0.38

January 9: Gold and Silver End Barely Lower

Chris Mullen
|
Wednesday, January 9th
 

Close

Gain/Loss

Gold

$1657.40

-$0.80

Silver

$30.33

-$0.02

XAU

159.84

-0.44%

HUI

422.35

-0.55%

GDM

1233.80

-0.55%

JSE Gold

2180.09

-0.47

USD

80.52

+0.19

Euro

130.63

-0.19

Yen

113.94

-0.88

Oil

$93.10

-$0.05

10-Year

1.852%

-0.019

T-Bond

145.50

+0.3125

Dow

13390.51

+0.46%

Nasdaq

3105.81

+0.45%

S&P

1461.02

+0.27%

 
 

The Metals:

 

Gold climbed $7.59 to $1665.79 in Asia before it fell back to as low as $1651.50 by about 1PM EST, but it then rallied back higher in the last few hours of trade and ended with a loss of just 0.05%. Silver rose to $30.57 in Asia before it slipped back to $30.05 by late morning in New York, but it also rallied back higher in afternoon trade and ended with a loss of just 0.07%.

 

Euro gold rose to about €1269, platinum gained $16.90 to $1593.90, and copper remained at about $3.67.

 

Gold and silver equities fell about 1% in the first hour of trade before they bounced back higher at times, but they still ended with modest losses on the day.

The Economy:

 

Obama Said to Name Jack Lew to Replace Geithner at Treasury Bloomberg

U.S. mortgage applications rebound in latest week: MBA Reuters

Tomorrow at 8:30AM EST brings Initial Jobless Claims for 1/05 expected at 364,000 and at 10AM is the Wholesale Inventories report for November expected at 0.2%.

 

The Markets:

 

Charts Courtesy of http://finance.yahoo.com/

 

Oil turned slightly lower after the Energy Information Administration reported that crude inventories rose 1.3 million barrels, gasoline inventories rose 7.4 million barrels, and distillates rose 6.8 million barrels.

 

The U.S. dollar index rose as the euro continued to fall ahead of tomorrow’s ECB meeting. The yen also resumed its fall on expectations for easy monetary policy from the Bank of Japan.

 

Treasuries pared early gains after today’s $21 billion 10-year note auction sold at a yield of 1.863% with a bid to cover of 2.83.

 

The Dow, Nasdaq, and S&P rose after Alcoa’s earnings report, released after the bell yesterday, raised expectations for other upcoming corporate results.

 

Among the big names making news in the market today were Dish, UBS, Blackstone, GM, Vodafone, AIG, Cigna, Morgan Stanley, Boeing, and Alcoa.

The Commentary:

 

Yesterday gold bounced off its support level; today it bounced off its resistance level, which is the 200 day moving average. As you can clearly see on the chart, that line is holding the market quite firmly for the time being.

Hedge funds are using this level against which to sell rallies while large physical offtake is providing the base of support from $1640 on down.

The market is stuck in a range for the time being with neither the bull nor the bear camp gaining a decided short term advantage for now, although the chart suggests that the bears have the intermediate term advantage.

Unless or until the bulls can take out the 200 day moving average and then get the price back above last week's high, the support level is going to be in danger if physical demand slacks off one iota. Once again it will be up to that side of the gold equation to try to put a firm bottom in this thing especially with speculators in a selling mood.

 

One of the things that is happening is that the recent price action has gotten the large investment banks, which issue regular analysis for their clients as to future price direction for many markets, have definitely changed their tune in regards to gold. Many of them are now lowering their previous price forecasts for this year. That in turn has led to money outflows from gold and from the gold ETF. As a matter of fact, bearish option bets in the gold ETF are now outnumbering bullish bets based on the put to call ratio.

 

That goes to prove that price action makes market commentary.

 

Incidentally, this is one of the main proofs, let's call it exhibit A, that all traders/investors should make their investment decisions based on their own analysis of the technical price charts. These guys are always their most bullish when prices are soaring and their most bearish when prices are falling. In other words, they prophesy AFTER THE FACT. By learning how to properly read a price chart, you can be out well BEFORE they come out with their prognostications or IN before they switch to the other side and begin raising projections once again.

 

If you want to have another reason why gold is struggling some right now, as is silver, take a look at the following chart of the overall commodity sector. Notice that it too has failed to take out and remain above its 200 day moving average and is now sitting precariously right above a major support level.

 

While we wait for the inevitable inflationary consequences for all this Central Bank liquidity injection, for the time being, inflation scares are non-existent. Whether the monetary base is falling or the velocity of money still remains low, it is difficult to make a CURRENT CASE for inflation as long as this key index is so weak on the chart.

 

While interest rates on the Ten Year had recently risen to over 1.95%, they have now fallen back towards 1.85%. We will have to keep an eye on that key indicator or potential inflation concerns, as well as the long bond which has popped lately and recovered somewhat from its beginning-of-the-year selling avalanche. I mentioned previously and want to reiterate - the monetary masters will not tolerate rising interest rates and will do what it takes to prevent that.- Dan Norcini, More at http://www.traderdannorcini.blogspot.com/

 

The Statistics:

As of close of business: 1/08/2013

Gold Warehouse Stocks:

10,944,254.267

-30,896.15

Silver Warehouse Stocks:

150,307,020.769

+725,028.21

 

Global Gold ETF Holdings

[WGC Sponsored ETF’s]

 

Product name

Total Tonnes

Total Ounces

Total Value

New York Stock Exchange Arca (NYSE Arca) AND Singapore Exchange (SGX) AND Tokyo Stock Exchange (TSE) AND Hong Kong Stock Exchange (HKEx)

SPDR® Gold Shares

1339.837

43,077,093

US$71,324m

London Stock Exchange (LSE) AND NYSE Euronext Paris AND Borsa Italiana AND Frankfurter Wertpapierbörse (Deutsche Börse - Xetra)

Gold Bullion Securities

139.03

4,469,828

US$7,404m

London Stock Exchange (LSE) AND NYSE Euronext Paris AND Borsa Italiana AND Frankfurter Wertpapierbörse (Deutsche Börse - Xetra) AND NYSE Euronext Amsterdam

ETFS Physical Gold

159.01

5,112,260

US$8,336m

Australian Stock Exchange (ASX)

Gold Bullion Securities

11.16

358,789

US$594m

Johannesburg Securities Exchange (JSE)

New Gold Debentures

42.45

1,364,715

US$2,214m

Note: Change in Total Tonnes from yesterday’s data: SPDR subtracted 0.903 tonnes.

 

COMEX Gold Trust (IAU) Total Tonnes in Trust: 219.04: +0.31 change from yesterday’s data.

 

Silver Trust (SLV) Total Tonnes in Trust: 10,112.22: No change from yesterday’s data.

 

The Miners:

 

Brigus Gold’s (BRD) drill results, Richmont’s (RIC) mining permit, Nevsun’s (NSU) production results, McEwen’s (MUX) commercial production, Eldorado’s (EGO) operating results and guidance, Exeter’s (XRA) water drilling, Pretivm’s (PVG) project update and ramp advance, Silver Bear’s (SBR.TO) license extension, Apogee’s (APE.V) successful community meeting, and First Majestic’s (AG) fourth quarter production were among the big stories in the gold and silver mining industry making headlines today.

 

WINNERS

1. Richmont

RIC +6.95% $3.23

2. Banro

BAA+5.00% $2.94

3. ITH

THM+3.77% $2.20

LOSERS

1. Almaden

AAU-3.54% $3.00

2. Rubicon

RBY-3.13% $2.48

3. Vista Gold

VGZ-3.01% $2.58

Winners & Losers tracks NYSE and AMEX listed gold and silver mining stocks that trade over $1.

Please see Yahoo’s Mining/Metals News Wire for all of today’s mining news.

 

- Chris Mullen, Gold Seeker Report

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© Gold Seeker 2013

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