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Gold Seeker Closing Report: Gold and Silver Fall Over 1%
By: Chris Mullen, Gold-Seeker.com

 -- Published: Monday, 27 January 2014 | Print  | Disqus 

 

Close

Gain/Loss

Gold

$1255.10

-$13.30

Silver

$19.63

-$0.28

XAU

89.58

-3.34%

HUI

212.87

-3.06%

GDM

637.36

-2.86%

JSE Gold

1270.10

-0.97

USD

80.48

+0.02

Euro

136.73

-0.07

Yen

97.45

-0.32

Oil

$95.72

-$0.92

10-Year

2.766%

+0.031

Bond

132.34375

-0.50

Dow

15837.88

-0.26%

Nasdaq

4083.60

-1.08%

S&P

1781.56

-0.49%

 
 

 

The Metals:

 

Gold dropped down to $1252.27 at about 2:30PM EST before it bounced back higher in the last hour and a half of trade, but it still ended with a loss of 1.05%.  Silver slipped to as low as $19.582 and ended with a loss of 1.41%.

 

Euro gold fell to about €918, platinum lost $16.30 to $1405.70, and copper fell slightly to about $3.27.

 

Gold and silver equities fell throughout most of trade and ended with about 3% losses.

 

The Economy:

 

Report

For

Reading

Expected

Previous

New Home Sales

Dec

414K

457K

445K

 

Tomorrow brings Durable Goods Orders, the Case-Shiller 20-city Index, and Consumer Confidence.

 

The Markets:

 

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

 

Oil fell on poor housing data that reduced demand expectations.

 

The U.S. dollar index edged higher as the yen fell after Japan posted a surprise increase in its trade deficit.

 

Treasuries fell ahead of Wednesday’s fed meeting.

 

The Dow, Nasdaq, and S&P traded mostly lower on worries about the fed and an economic slowdown in China.

 

Among the big names making news in the market today were Gilead, Google, Caterpillar, and Apple.

 

The Commentary:

 

Strong buying overnight in the early part of the Asian trading session took gold into a region of formidable chart resistance near the $1,280 level. At that point sellers entered sensing that the bulls were booking profits and prices needed a breather.

With the nervousness surrounding last week's emerging markets currency/credit crisis subsiding somewhat, gold ran out of reasons to keep moving vertical. If you notice, the Japanese Yen and Swiss Franc, the beneficiaries of last week's rush to safety plays, are weaker today. Also, the S&P 500 is trading higher while the US Dollar has managed to obtain a firm bid. With the VIX moving lower as well, it appears that for the moment, the market is less concerned about the emerging market issues that plagued it last week. How long this lasts is anyone's guess but for the immediate moment, gold is being sold and stocks are being bought once again.

If anything, last week's price action in response to the emerging markets reinforces in my mind the notion that gold MUST HAVE SOME SORT OF CONFIDENCE SHATTERING event(s) to push it into a sustained uptrend. The recent move up has consisted of a great deal of short covering and while there has indeed been some fresh buying, that has been largely outnumbered by speculative short covering.

As I have written many times here at this site, short covering rallies can be quite ferocious and oftentimes spectacular, but by their very nature, they tend to fizzle out as quickly as they start. Markets require the application of THRUST/FORCE to escape the downward pull of gravity and that necessitates SUSTAINED money flows (new buying ). If that new buying is lacking, gravity will win out and price will back down.

When it comes to gold that means any sort of credit/currency crisis must be one which escalates in the minds of traders/investors. Such escalation fans more fear and nervousness and that will drive money into gold. Given the current state of low inflationary expectations, it will take this sort of strong emotion to keep those flows active. At the first sign of stability or easing of tensions, gold will tend to surrender its gains with the more recent pattern of buying stocks/selling commodities coming to the ascendancy once again.

What this translates to when it comes to technical price action is selling at resistance zones. Gold thus far has managed to plow through several layers of overhead chart resistance and in the process turned the daily chart positive (the weekly remains decidedly bearish however). With traders looking for reasons to sell rallies, these resistance zones on the daily chart will take on more importance. Any hesitation by the bulls to extend the rally at these zones will bring in selling as very short term bulls bail out with any paper profits that they might have while longer term oriented bears look to re-enter on the short side.

It is always interesting to watch the battle lines being formed on the charts. Right now dips are being bought in gold based on the improving daily chart picture while rallies tend to stall - at least temporarily - at these resistance zones. Translating to numbers - resistance is the zone near $1280 with support being provided by the zone near $1260-$1258.

I am watching to see what gold does if equities start moving lower once again and particularly if the Dollar cannot hold any gains. I will provide an update later in the session as the direction towards the pit close becomes evident.- Dan Norcini, More at http://www.traderdannorcini.blogspot.com/

 

GATA Posts:

 

 

India to review gold restrictions by end of March

Mark Mahaffey: Day of the turtles

 

The Statistics:

Activity from: 1/24/2014

Gold Warehouse Stocks:

7,462,730.857

-546.55

Silver Warehouse Stocks:

178,983,843.523

+484,463.20

 

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

790.456

25,413,962

US$32,023m

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$5,611m

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$451m

Johannesburg Securities Exchange (JSE)

New Gold Debentures

41.88

1,346,506

US$1,674m

 

COMEX Gold Trust (IAU) Total Tonnes in Trust: 161.37.

 

Silver Trust (SLV) Total Tonnes in Trust: 10,029.22.

 

The Miners:

 

No “winners” today.

LOSERS

1.  Alexco

AXU -12.28% $1.50

2.  Richmont

RIC -12.00% $1.32

3.  Midway

MDW -9.65% $1.03

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

© Gold Seeker 2014

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.

 


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 -- Published: Monday, 27 January 2014 | E-Mail  | Print  | Source: GoldSeek.com

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