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Gold Seeker Closing Report: Gold and Silver Fall Roughly 2%
By: Chris Mullen


-- Posted Monday, 14 May 2012 | | Disqus

 

Close

Gain/Loss

Gold

$1558.60

-$22.70

Silver

$28.23

-$0.68

XAU

147.22

-2.66%

HUI

390.74

-3.36%

GDM

1133.98

-3.39%

JSE Gold

2280.19

-78.17

USD

80.64

+0.36

Euro

128.36

-0.81

Yen

125.23

+0.11

Oil

$94.78

-$1.35

10-Year

1.788%

-0.053

T-Bond

146.09375

+0.96875

Dow

12695.35

-0.98%

Nasdaq

2902.58

-1.06%

S&P

1338.35

-1.11%

 
 

 

The Metals:

 

Gold fell to as low as $1556.81 in early New York trade before it bounced back higher at times, but it still ended with a loss of 1.44%.  Silver slipped to as low as $28.19 and ended with a loss of 2.35%.

 

Euro gold fell to about €1214, platinum lost $24.75 to $1435, and copper dropped 10 cents to about $3.53.

 

Gold and silver equities fell about 3% at the open before they rebounded to almost unchanged by midmorning, but they then fell back off into the close and ended near their lows of the day.

 

The Economy:

 

There were no major economic reports today.  Tomorrow at 8:30AM EST brings Retail Sales for April expected at 0.2%, CPI for April expected at 0.0%, and Empire Manufacturing for May expected at 8.4.  At 9AM is the Net Long-Term TIC Flows report for March, and at 10AM are Business Inventories for March expected at 0.3% and the NAHB Housing Market Index for May expected at 26.

 

The Markets:

 

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

 

Oil fell as the U.S. dollar index and treasuries rose on increased worries about Europe that sent the Dow, Nasdaq, and S&P lower.

 

Output falling, Euro zone heads for recession Reuters

Greece hits political stalemate, euro exit fears grow Reuters

Euro Officials Begin to Weigh Greek Exit as Euro Weakens Bloomberg

 

Among the big names making news in the market today were Ford, Avon, Yahoo, and JPMorgan.

 

The Commentary:

 

Gold has continued to see further selling in today's session with traders once again exiting "RISK" trades in favor of the "Growth Off" or RISK AVERSION trades. Long commodity positions, along with long equities, are getting liquidated with money flows heading towards US Treasuries in general. This can be seen in the CCI, the Continuous Commodity Index, which is moving lower while bonds move higher, taking interest rates down even further as the yield on the Ten Year is now down below the 1.80% level. Remember, there has not been a week yet during which this yield ENDED BELOW that critical level.

Gold's move down towards $1550 has in the past attracted very substantial Central Bank gold buying. Hopefully this will remain the case as the market is now pushing towards the lower band of an eight month long trading range. If speculative selling of the metal is not absorbed down here and the market were to break below $1520 and fall to recover quickly, it will more than likely drop below $1500.

My own thinking on this is that the markets are moving so quickly away from risk and out of basically everything except Treasuries or cash, that the Fed is going to have a major problem on their hands if they do not soon give some sort of signal that they are preparing to act to stem the deflationary decline. JP Morgan's $2 Billion credit derivatives-based loss has spooked the banking sector and that is the one sector that the monetary officials do not want to see going from bad to worse. Keep in mind that back in 2008, once Lehman went under with Bear Stearns following, it was the woes of the financial sector that pulled the rug out from under the entire US economy and the US equity markets. The Fed is well aware of this and I suspect will not want to wait too long before beginning to make some noise to keep the markets from becoming too roiled.

The bank shares might be the first thing to watch for some signs of further monetary accommodation as one can be assured that there are lots of phone calls and discussions underway even now. If they were to show some signs of bottoming, it might be a hint of things to come.

Meanwhile gold will need to get at least back above $1600 to give the bulls some breathing room. With the Commitment of Traders report showing the NET LONG position of the big hedge funds at a 42 month low, there remains plenty of room for them to come back into this market and juice it higher but they need some sort of signal to tell them to do so. Right now they are not getting it; if anything, some hedge funds are now moving to the short side of gold along as well as a host of various other commodity markets.

Incidentally, China is lowering their bank reserve ratio requirements, a sign that they are responding to slowing growth there as their export markets are impacted by the woes in the Eurozone and the anemic growth in the US. This is one of the signals that copper has been sending for a while now as it descends in price. Were copper to finally show some signs of a bottom, that would be constructive for silver which is testing chart support down near the $28 level once again.- Dan Norcini, More at http://www.traderdannorcini.blogspot.com/

 

GATA Posts:

 

 

German Parliament wants accounting of gold reserves; Bundesbank resisting

Pat Heller: U.S. govt. agency is specifically authorized to rig gold market

 

The Statistics:

As of close of business: 5/11/2012

Gold Warehouse Stocks:

11,004,108.994

-10,554,141

Silver Warehouse Stocks:

140,489,667.959

-92,315.39

 

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

awaited

awaited

US$awaited

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

Gold Bullion Securities

awaited

awaited

US$awaited

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

ETFS Physical Gold

awaited

awaited

US$awaited

Australian Stock Exchange (ASX)

Gold Bullion Securities

awaited

awaited

US$awaited

Johannesburg Securities Exchange (JSE)

New Gold Debentures

awaited

awaited

US$awaited

 Note: No change in Total Tonnes from yesterday’s data.

 

COMEX Gold Trust (IAU) Total Tonnes in Trust: 179.22: No change from yesterday’s data.

 

Silver Trust (SLV) Total Tonnes in Trust: 9,465.08: No change from yesterday’s data.

 

The Miners:

 

Seabridge’s (SA) updated National Instrument 43-101-compliant Preliminary Feasibility Study, Claude’s (CGR) first quarter results, Rubicon’s (RBY) drill results, and Silver Wheaton’s (SLW) first quarter results and dividend were among the big stories in the gold and silver mining industry making headlines today. 

LOSERS

1.  Extorre

XG -14.10% $2.68

2.  Mag Silver

MVG-11.26% $7.72

3.  McEwen

MUX-10.26% $2.71

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

 

- Would you like to receive the Free Daily Gold Seeker Report in your e-mail? Click here

Additional Resources for today’s Gold Seeker Report can be found:

© Gold Seeker 2012

Note: This article may be reproduced provided the article, in full, is used and mention to Gold-Seeker.com is given.

 

 

Disclosure: The owner, editor, writer and publisher and their associates are not responsible for errors or omissions.  The author of this report is not a registered financial advisor.  Readers should not view this material as offering investment related advice. Gold-Seeker.com has taken precautions to ensure accuracy of information provided. Information collected and presented are from what is perceived as reliable sources, but since the information source(s) are beyond Gold-Seeker.com’s control, no representation or guarantee is made that it is complete or accurate.  The reader accepts information on the condition that errors or omissions shall not be made the basis for any claim, demand or cause for action.  Past results are not necessarily indicative of future results.  Any statements non-factual in nature constitute only current opinions, which are subject to change.  Nothing contained herein constitutes a representation by the publisher, nor a solicitation for the purchase or sale of securities & therefore information, nor opinions expressed, shall be construed as a solicitation to buy or sell any stock, futures or options contract mentioned herein.  Investors are advised to obtain the advice of a qualified financial & investment advisor before entering any financial transaction.


-- Posted Monday, 14 May 2012 | Digg This Article | Source: GoldSeek.com

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