-- Posted Tuesday, 26 March 2013 | | Disqus

STATS

London Gold AM Fix $1,597.25, -5.00 LME Copper Stocks 566,325 tons +975 tons

Gold Stocks 9.279 million ounces -111,055, Silver Stocks 164.647 million ounces +542,337

Hong Kong Shares were able to throw off early weakness to finish minimally higher, as earnings from the property sector countervailed weakness in mainland shares, which in turn were off initially because of fears of new share issuance ahead. European shares were higher to start today, as quarter end window dressing might have lifted some shares overnight, but the Cyprus situation still appears to be discouraging some investors. In fact, the re-opening of banks in Cyprus and the potential backlash from Russia to the recent "deal" should leave some credit market anxiety in place for most of this week. However, the US economic report slate really picks up pace today with Durable goods, Home prices, Consumer Confidence, Richmond Fed Business activity and New home sales all scheduled for release. There will also be a speech from the Fed's Fisher, a 2 Year note auction and some private weekly chain store sales data out early today. Expectations call for gains in Durables, and Home prices with somm minor weakness seen in Consumer Confidence and new Home sales figures.

GOLD

At least initially April gold is showing some weakness as anxiety off the Cyprus situation continues to wane. Not surprisingly, gold is seeing some spillover weakness from bearish analyst views released overnight, as one forecast cut its gold price outlook slightly and another suggested that the near term trend in gold prices was probably set to point downward. Apparently gold wasn't cheered by news of ongoing gold reserve builds by both Russia and Turkey, perhaps because Canada and Mexico saw their gold reserves decline in the month of February. Indian gold demand overnight was reported to be slack again but that might have been largely the result of ongoing Dollar strength against the rupee. An issue that might be considered bearish toward gold prices, is news that an Italian opinion poll has suggested that the Italian government "use" its 2,000 tons of gold reserves to offset public debt, but the survey supposedly wanted the Italian government to maintain its ownership of gold, which would seem to imply the mere use and not the sale of gold to lower public debt. The big question for the gold trade today will be the markets reaction to US data, as positive data recently has weighed on gold prices. Expectations suggest that initial US data could be positive, with weaker data released later on. However, ideas that the US currency is set to remain strong, could simply keep gold and other physical commodity markets under pressure. Comex Gold Stocks were 9.279 million ounces down 111,055 ounces.

SILVER

Like gold, silver also saw somewhat bearish analyst views on silver prices overnight, with one source cutting its silver price forecast slightly and another suggesting that silver temporarily lacks a definitive fundamental focus. While the most recent COT positioning report put the Non-reportable and Non-Commercial net long position at only 25,000 contracts, it could take a number well below 15,000 net long to suggest that silver has removed a large number of safe haven longs. In other words, for silver to bottom, the market might have to get away from its flight to safety status and in turn shift back into a classic physical commodity market that is capable of tracking the ebb and flow of the global economy. In looking at the charts in silver, it is clear that the market has been coiling tightly, as if it is waiting for a key decision. The bull camp might suggest that the sideways coiling pattern suggests that the definitive downtrend pattern that has been in place since last October's highs, might have run its course. Comex Silver Stocks were 164.647 million ounces up 542,337 ounces. Comex Silver Stocks are now at the highest levels since 08/15/1997.

PLATINUM

Apparently the platinum trade was unmoved by the news of impending mine closures of South African Amplats facilities, as July platinum overnight took out the prior session's lows. Apparently Amplats will end a "consultation period" on March 31st on a plan to cut as many as 14,000 jobs and that plan could also idle several mine shafts. The unions have suggested they will strike and effectively close other mine shafts, if the restructuring plan is implemented, but Amplats has tried to sooth the transition with an $86 million development fund. Unfortunately, the non-commercial and Non-reportable net long position in platinum remains somewhat lofty at 40,000 contracts as of March 19th and the market might not be technically leveled until that positioning falls down to a net long closer to 30,000 contracts. Critical support and a possible pivot point is seen just below the current market at $1,573 and then not until the $1,567 level. We see the trend pointing down until the July platinum contract manages a recovery back above $1,591.

COPPER

The copper market was barely higher this morning, but that might have been the result of a partially oversold condition yesterday afternoon. The bull camp could suggest that the magnitude of the daily build in LME copper stocks was limited overnight and they could also suggest that recent scheduled data has been generally supportive of copper prices. However, Asian copper prices overnight were soft and the market was also confronted with news that Chinese copper scrap importers were reducing near term orders. Some of the reduction in Chinese scrap copper import orders might have been the result of customs changes but the trade also hasn't been overly impressed with recent Chinese demand developments. In fact, fears of property curbs in China seemed to undermine sentiment toward copper overnight and therefore the Chinese copper demand outlook remains suspect. In looking ahead, the copper trade might see some support from the early US scheduled data flows today, but residual strength in the Dollar might serve to limit the upside in copper in the near term. With a minor 975 ton gain in daily LME copper stocks overnight the copper market has now seen 29 straight days of builds in exchange stocks.

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-- Posted Tuesday, 26 March 2013 | Digg This Article | Source: GoldSeek.com

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