-- Posted Thursday, 1 August 2013 | | Disqus
| Close | Gain/Loss |
Gold | $1310.30 | -$12.50 |
Silver | $19.66 | -$0.16 |
XAU | 96.11 | -2.67% |
HUI | 240.62 | -3.27% |
GDM | 722.15 | -3.01% |
JSE Gold | 1278.85 | +24.52 |
USD | 82.37 | 0.71 |
Euro | 132.05 | -0.97 |
Yen | 100.48 | -1.70 |
Oil | $107.89 | +$2.86 |
10-Year | 2.723% | +0.130 |
T-Bond | 132.3125 | -1.75 |
Dow | 15628.02 | +0.83% |
Nasdaq | 3675.74 | +1.36% |
S&P | 1706.87 | +1.25% |
The Metals:
Gold climbed $5.50 to $1328.30 at about 8:30AM EST, but it then fell to as low as $1308.22 by midday and ended with a loss of 0.94%. Silver slipped to $19.55 in Asia before it climbed to $19.973 in London, but it then fell back off in New York and ended with a loss of 0.81%.
Euro gold fell to about €992, platinum rose $3 to $1437.50, and copper climbed 4 cents to about $3.16.
Gold and silver equities fell over 2% by midday and remained near that level for the rest of the day.
The Economy:
Report | For | Reading | Expected | Previous |
Initial Claims | 7/27 | 326K | 345K | 345K |
ISM Index | July | 55.4 | 51.5 | 50.9 |
Construction Spending | June | -0.6% | 0.2% | 1.3% |
Tomorrow brings July’s jobs data, Personal Income and Spending, and Factory Orders.
The Markets:
Charts Courtesy of http://finance.yahoo.com/
Oil rose along with the U.S. dollar index on stronger than expected economic data that sent treasuries lower.
The Dow, Nasdaq, and S&P climbed higher on strong economic data combined with continuing stimulus programs around the world.
Among the big names making news in the market today were Procter & Gamble, MetLife, Four Seasons, Sturm Ruger, J.C. Penney, Avon, GM, Toyota, Ford, and Chrysler.
The Commentary:
“Talk about a stark contrast from one day to the next! Yesterday we were all sifting through the inner parts of the FOMC statement and noting the dovish tone and the more downbeat assessment of the US economy from the Fed. Today the ISM (Institute for Supply Management) number for the month of July hit the wires and boy howdy was it a shocker.
Activity for US manufactures took a big leap upward to 55.4 from June's 50.9 reading! That was the best reading since June 2011.
If that was not enough, the employment component of the data jumped to 54.4 from 48.7. That, coming on the heels of today's jobless claims number, which came in at 326,000 versus an expected 345,000 got the attention of traders in a big hurry. With that, stocks were off to the races, bonds plummeted and the Dollar soared against all of the majors.
Guess what, gold barely moved! I find that rather remarkable considering the fact that we had a HUGE MOVE UP in the Dollar based on talk that the TAPERING was back on. Normally, with tapering talk back on, a surging Dollar, rising interest rates, etc. gold could have been expected to get knocked for a loop. It is holding steady as I type these comments and is oscillating on both sides of the unchanged level.
The metal had a strong move overnight as yesterday's dovish FOMC put the kibosh on the gold bears and had them second guessing whether or not they should aggressively sell in the face of such a dovish statement. However, it did run out of buyers up near $1330 and then retreated back down towards $1308 where once again, just like it has been doing of late, buyers showed up in a big way.
So here we are back near the bottom of the price range again and that means one thing from a technical aspect - the support zone I noted on yesterday's chart is intact but it MUST HOLD to prevent a drop to $1300. If that gives way, gold will move towards $1280.
Can you notice how the bears are selling up against that downtrending 50 day moving average? Can you also see how stubborn this overhead level of chart resistance is?
What is weighing on gold today, in spite of its strength, is the fact that the miners are moving lower once again. This is making some longs nervous because the shares seem to have gone back to leading bullion whether it is higher or lower of late.
Let me comment here also a bit further on the backwardation thing - I mentioned that I would keep us posted if the delivery month contract, August, were to move to a premium over the next month contract, which for all practical purposes is the October. Currently, as of this hour, the BIDS for August are running about $0.40 premium to the bids for October and are actually on a par with the December. They are also a mere $1.00 discount to the February 2014 gold contract. NOW, we have the beginnings of a true backwardation structure on the futures board that we have not previously had. It is not completely there yet but for today, it certainly is moving that way.
Now whether or not this translates to a higher price is uncertain. So far, as mentioned above, even with the August contract moving out to a slight premium to the October, gold is failing at overhead chart resistance. It has not broken down technically but it also has not broken out to the upside either.
I have written repeatedly here that PRICE ACTION is the ultimate arbiter of whether or not a development is bullish or bearish. Gold thus needs to prove itself.
Let me give you an example using corn... just today the BASIS for cash corn in Cedar Rapids, Iowa is a whopping + $1.20. That is huge! It means that old crop corn in that location is fetching $1.20 more than the nearby September futures contract which is currently trading at $4.87 as I type this. Cash buyers of corn at that particular elevator are therefore willing to pay, as of today, $6.07 for a bushel of corn when all they have to do is to wait a month and they could get it for $4.87! Someone must need it quite badly.
However, here is the point, while the basis is positive the corn chart is awful....
the price is sinking lower, the basis is positive. In other words, a FUTURES TRADER who moved to buy corn based SOLELY on the positive basis, would have ended up losing a huge amount of money, not to mention the fact of lost profit potentials from using the price action to dictate a short position instead.
I understand that corn is not the same as gold mainly because we have TWO different crop years we are discussing right now and are trading off of in the futures markets, but the main point that I am trying to make, AS A TRADER, is that PRICE ACTION DICTATES whether or not any event has significance to market participants. Never forget this concept if you are to be successful TRADING.
The delivery process for the second day in August gold futures was relatively quiet compared to the large issues from Deutchse yesterday. Again, Morgan was a large stopper with the house taking the bulks of the sales while ABN AMRO was the large issuer. Not much to take away from this right now. We'll keep an eye on it as the delivery process unfolds.”- Dan Norcini, More at http://www.traderdannorcini.blogspot.com/
GATA Posts:
Dennis Gartman is 'willing to give GATA its due'
On 'Keiser Report,' bullion trader Maguire describes run on the London gold banks
The Statistics:
As of close of business: 7//2013
Gold Warehouse Stocks: | 7,023,288.121 | +31,858.19 |
Silver Warehouse Stocks: | 164,680,793.225 | -30,126.09 |
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) AND Mexico Stock Exchange (BMV) | SPDR® Gold Shares | 927.355 | 29,815,390 | US$39,190m |
London Stock Exchange (LSE) AND NYSE Euronext Paris AND Borsa Italiana AND Frankfurter Wertpapierbörse (Deutsche Börse - Xetra) | Gold Bullion Securities | 138.13 | 4,441,056 | US$5,823m |
London Stock Exchange (LSE) AND NYSE Euronext Paris AND Borsa Italiana AND Frankfurter Wertpapierbörse (Deutsche Börse - Xetra) AND NYSE Euronext Amsterdam | ETFS Physical Gold | 152.66 | 4,908,200 | US$8,004m |
Australian Stock Exchange (ASX) | Gold Bullion Securities | 11.16 | 358,789 | US$470m |
Johannesburg Securities Exchange (JSE) | New Gold Debentures | 42.66 | 1,371,440 | US$1,824m |
Note: No change in Total Tonnes from yesterday’s data.
COMEX Gold Trust (IAU) Total Tonnes in Trust: 178.85: No change from yesterday’s data.
Silver Trust (SLV) Total Tonnes in Trust: 10,419.04: No change from yesterday’s data.
The Miners:
Barrick’s (ABX) second quarter results, Exeter’s (XRA) unusual trading activity, Randgold’s (GOLD) future in Mali, AngloGold’s (AU) new, low-cost mine commissioning, SEMAFO’s (SMF.TO) drill results, and Paramount’s (PZG) drill results were among the big stories in the gold and silver mining industry making headlines today.
WINNERS
1. Turquoise | TRQ +10.67% $4.46 |
2. Solitario | XPL +10.31% $1.04 |
3. Seabridge | SA +9.85% $12.27 |
LOSERS
1. Yamana | AUY -7.90% $9.67 |
2. Allied Nevada | ANV -5.85% $6.28 |
3. Buenaventura | BVN-5.73% $13.48 |
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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-- Posted Thursday, 1 August 2013 | Digg This Article
| Source: GoldSeek.com
Gold Seeker Closing Report: Gold and Silver Fall Almost 1%
