-- Posted Tuesday, 25 September 2012 | | Disqus
| Close | Gain/Loss |
Gold | $1761.40 | -$3.10 |
Silver | $33.72 | -$0.24 |
XAU | 185.92 | -1.67% |
HUI | 501.11 | -1.55% |
GDM | 1438.86 | -1.56% |
JSE Gold | 2418.12 | -39.84 |
USD | 79.65 | +0.10 |
Euro | 129.11 | -0.20 |
Yen | 128.58 | +0.09 |
Oil | $91.37 | -$0.56 |
10-Year | 1.682% | -0.036 |
T-Bond | 148.375 | +0.78125 |
Dow | 13457.55 | -0.75% |
Nasdaq | 3117.73 | -1.36% |
S&P | 1441.59 | -1.05% |
The Metals:
Gold climbed $10.25 to $1774.75 by a little after 10AM EST, but it then fell back off midday and ended near its late session low of $1758.90 with a loss of 0.18%. Silver rose to as high as $34.47 in early New York trade before it also fell back off midday and ended with a loss of 0.71%.
Euro gold remained at about €1365, platinum gained $9.70 to $1626.50, and copper rose slightly to about $3.75.
Gold and silver equities saw over 1% gains at the open, but they then turned lower in early afternoon trade and ended with over 1.5% losses.
The Economy:
Report | For | Reading | Expected | Previous |
Case-Shiller 20-city Index | July | 1.2% | 0.8% | 0.5% |
Consumer Confidence | Sep | 70.3 | 63.0 | 61.3 |
FHFA Housing Price Index | July | 0.2% | - | 0.7% |
Tomorrow at 10AM EST brings New Home Sales for August expected at 380,000.
The Markets:
Charts Courtesy of http://finance.yahoo.com/
Oil erased early gains and closed with a modest loss after Federal Reserve Bank of Philadelphia President Charles Plosser said new bond buying announced by the Fed this month probably won’t boost growth or hiring and may jeopardize the central bank’s credibility.
The U.S. dollar index ended higher in mixed trade on Plosser’s comments.
Treasuries extended higher after today’s $35 billion 2-year note auction sold at a high yield of 0.273% with a bid to cover of 3.6.
The Dow, Nasdaq, and S&P turned lower after Plosser’s discouraging comments.
Among the big names making news in the market today were Michael Kors, RIM, Morgan Stanley, Staples, Apple, Tesla, and Google.
The Commentary:
“Gold is trading firmly today as risk appetite is back on after a bit of a hiccup yesterday. Many investors/traders are growing a bit more sanguine about the impact of any QE program and are still concerned about slowing global economic growth in spite of Central Bank actions to stimulate borrowing and spending. That is leading to more two-sided trade in gold, and in silver I might add, as traders sort out clues to see which direction the economy might be taking.
Frankly, I think it is pathetic that we have reached a point in our nation's history that the actions of the Fed have so discombobulated common sense. No one knows whether to call "Good", "Bad" or "Bad", "Good", as far as any impact on the direction of the stock market. In other words, we really have reached a point where many traders do not know what to do with either good or bad news. If the news were to become too "good", traders are concerned that the Central Banks might not keep the liquidity spigots open as long as initial expectations. If the news were to become too "bad", traders would take comfort in the cornucopia of easy money but then how exactly is such "bad" news conducive to solid economic growth?
I personally have reached a point where I believe the US financial markets have become utterly useless when it comes to actually being an efficient allocator of precious investment capital. The signals are too distorted by Central Bank activity. Call me a purist but I believe that there should have been no QE whatsoever whether it was QE1, QE2 or QE3 as I do not believe the system would have crashed without it.
Yes, the large banks would have taken a huge blow and might have possibly failed but so what? There are many banks in this nation that are rock solid, with conservative and well-performing loan portfolios. All that would have happened is that the poor performing loans would have been either written off or sold for a fraction of their face value to some of these good banks.
I will be the first to admit that the blow to the economy would have been very severe, but I also believe we would already perhaps be entering the healing period instead of just making the current addiction even worse.
What we have now instead is an enormous money printing scheme that has heretofore a somewhat dubious record of achieving any lasting or permanent success. If you want proof, take a look at the Japanese economy and its stock market index I might add. The Land of the Rising Sun has never recovered from its failed experiment of propping up bad banks with its own version of QE.
As I have said before and will say again, the problems ailing the US economy or those of the Euro Zone or elsewhere, cannot be plastered over with bond buying programs and other government-type stimulus measures. These issues require STRUCTURAL REFORMS and among the number one reform is an end to the madness of spending money that you do not have. Spendthrift political leaders, in their desire to effectively buy votes for re-election, will spend their respective nations into the toilet before they do the right thing for their nation's long term prosperity and economic security. Hey, but why bother with that when you can spend the future savings of the children and grandchildren of this generation? They do not vote so who gives a damn about what we are bequeathing to them!
Back to gold however - while it is up today I am concerned that it looks to be stalling out up here. With the general public (small specs) holding the largest net long position on record there is a risk of downside stop hunting occurring if the short term oriented longs decide to start cashing in their chips. So far gold is merely flat lining along the next "STEP" on the chart. As you can see, it has worked sideways along these steps gathering energy before it then takes a sharp leg higher where it repeats the process. As long as support down at the most recent step holds, it will be okay as attempts to reach the sell stops will be thwarted by solid dip buying. However, if the dip buyers ease off for any reason, these stops will be vulnerable as a large number of small speculators are holding long positions entered into above the $1780 level. Those are underwater already so they remain liable to getting forced out if the market were to break below the $1755 - $7150 level.
I would expect any stop related selloff to generate some buying interest however especially down towards $1735 - $1725, the region labeled as "Secondary Support" on the chart.
The trend in gold is up until proven otherwise but that does not mean we cannot or will not experience temporary price retracements in the short term. That is a far, far cry from a trend reversal. Keep in mind that my perspective is that of a trader, not a longer term oriented investor. Unless you are very nimble and fleet of foot, leave the short term trading swings to the professionals. Acquire the physical metals on dips in price and then let nature take its course. By nature of course, I mean the feckless political leaders and Central Bankers of the West.
Incidentally, news out today shows that there has been some decent buying of gold by Central Banks, among them S. Korea and Paraguay. John Brimelow's excellent Gold Jottings details the tonnage involved. It does show that various Central Banks around the world are providing a solid demand base for the actual physical metal. This is a source of fundamental support that continues to exist underneath the gold market. Remember it was this type of buying earlier this year that thwarted the hedge fund shorts from breaking down the gold price when gold was flirting with the $1550- $1525 level. This buying was able to absorb a huge amount of the supply hitting the market.”- Dan Norcini, More at http://www.traderdannorcini.blogspot.com/
GATA Posts:
Ted Butler urges JPMorganChase to try transparency in silver
GATA Chairman Murphy interviewed by Sprott Money's Neil Lome
The Statistics:
As of close of business: 9/24/2012
Gold Warehouse Stocks: | 10,896,892.139 | -142,394.705 |
Silver Warehouse Stocks: | 140,900,288.564 | +916,875.529 |
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 | 1326.808 | 42,658,193 | US$75,546m |
London Stock Exchange (LSE) AND NYSE Euronext Paris AND Borsa Italiana AND Frankfurter Wertpapierbörse (Deutsche Börse - Xetra) | Gold Bullion Securities | 135.61 | 4,359,962 | US$7,720m |
London Stock Exchange (LSE) AND NYSE Euronext Paris AND Borsa Italiana AND Frankfurter Wertpapierbörse (Deutsche Börse - Xetra) AND NYSE Euronext Amsterdam | ETFS Physical Gold | 153.91 | 4,948,492 | US$8,069m |
Australian Stock Exchange (ASX) | Gold Bullion Securities | 11.16 | 358,789 | US$633m |
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 added 9.046 tonnes.
COMEX Gold Trust (IAU) Total Tonnes in Trust: 199.51: No change from yesterday’s data.
Silver Trust (SLV) Total Tonnes in Trust: 10,015.99: +75.33 change from yesterday’s data.
The Miners:
Gold Fields’ (GFI) strike, Paramount’s (PZG) drilling, Banro’s (BAA) foundation, Vista Gold’s (VGZ) drill results, and Hecla’s (HL) presentation were among the big stories in the gold and silver mining industry making headlines today.
WINNERS
1. DRDGOLD | DRD +4.23% $6.40 |
2. Rubicon | RBY +1.91% $3.74 |
3. Eurasian | EMXX+1.78% $2.29 |
LOSERS
1. Mines MGMT | MGN -6.75% $1.52 |
2. Harmony | HMY -6.43% $8.44 |
3. Golden Minerals | AUMN -6.30% $5.06 |
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 2012
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-- Posted Tuesday, 25 September 2012 | Digg This Article
| Source: GoldSeek.com
Gold Seeker Closing Report: Gold and Silver End Slightly Lower
