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Last Updated : 03 February 2012 at 20:50 IST
'Next target for Gold at $ 1,800/oz, for Silver at $37/oz'
By Richard Russell
The great GOP debate continues with Gingrich finally dropping behind the Mitt.
Meanwhile, the stock market is caught in the puzzle of will Europe emerge whole from its current troubles, or will the Eurozone fall apart like a deflating balloon? That plus the following question: Does the US face another four years of a socialist president who seeks to solve all problems by either taxing " the rich" or throwing trillions of man-made dollars at the screw-up in question?
The poor man in the street is facing questions and doubts. Will he be at the same job a year from now? And if he gets a pink slip will he be able to find another job?
If the year 2012 has a title, the title should be " uncertainty."
Nobody's asking, " What happens if there's a recession in the next year?" Or " What if unemployment is 9% or more at presidential election time?" If either of the above occur, the GOP could run a donkey, and it would be our next president. Obama must have a good economy to win.
What about gold? Remember gold? Don't worry about the yellow metal. Over the last week Gold has broken out above a bearish trendline and the direction is now UP. The next task -- for gold to trade in the 1800s.
Below, Silver in a down-sloping rectangle. A hugely important upside breakout would arrive if silver could hit $37/oz.
Source: DowTheoryLetters
Gold retreats towards $1,750/oz after U.S. data
* U.S. non-farm payrolls data beat expectations
* Prospect of further U.S. monetary easing recedes
* Gold, platinum come off highest since mid-November (Updates prices)
By Jan Harvey
LONDON, Feb 3 (Reuters) - Gold prices fell more than 1 percent on Friday, surrendering gains that earlier took them to 11-week highs, after better-than-expected U.S. payrolls data lifted the dollar and called into question the prospect of further U.S. quantitative easing.
Expectations that U.S. monetary policy will remain ultra-loose have boosted investors' appetite for bullion this year, lifting prices 11 percent since end-December.
Spot gold was at $1,736.75 an ounce at 1500 GMT, down 1.3 percent, after having earlier peaked at $1,762.90. U.S. gold futures for February delivery were down $18.50 an ounce at $1,740.80.
Data from the Labor Department showed the U.S. economy in January created jobs at the fastest pace in nine months, adding 243,000 positions, and the unemployment rate dropped to a near three-year low of 8.3 percent.
" I think people are asking some questions now with regards to the Fed's view about low interest rates into 2014," said Ole Hansen, vice president at Saxo Bank. " If job creation carries on at this pace, that could be revised, thereby removing some of the support for gold."
The tone of the report was further strengthened by revisions to November and December payrolls data, which showed 60,000 more jobs were created than previously reported.
The dollar rose to session highs against the euro after the payrolls report, while equity markets also rallied. Among other commodities, oil prices extended gains to rise more than $1 a barrel amid expectations for firm demand from the United States.
" Today's release is a very positive report and will soothe some of the deeper concerns at the Fed," said Camilla Sutton, chief currency strategist at Scotia Capital. " I think increasingly (QE3) is being pushed to the background."
FED PLEDGE
A U.S. Federal Reserve pledge last month to keep interest rates at rock-bottom levels and hints of another round of monetary easing, which would keep the dollar weak and the opportunity cost of holding bullion low, boosted gold.
Fed Chairman Ben Bernanke on Thursday defended the bank's policies against charges from Republican lawmakers they risked sparking inflation, saying the economy still needs plenty of support.
" Yesterday's reaffirmation from the U.S. Fed (chairman) that he is committed to keep rates low ... (gave) gold the necessary boost to hold gains and also break key resistance," Richcomm Global Services senior analyst Pradeep Unni said.
Among other precious metals, silver was down 1.6 percent at $33.72 an ounce. Its ratio to gold, the number of silver ounces needed to buy an ounce of gold, eased back to 51.3 from a high of 57.4 hit in December.
Silver was the best performing of the major precious metals last month, rising more than 20 percent. Silver coin sales under the U.S. Mint's American Eagle programme totalled 6.107 million ounces in January, their highest in a year.
Spot platinum was down 0.6 percent at $1,617.24 an ounce, while spot palladium was down 0.1 percent at $704.75 an ounce. Platinum earlier hit its highest since Nov. 16 at $1,632.50.
Platinum prices are up 15.9 percent this year, supported by concerns over output of the metal from major producer South Africa. Natixis said it expects output growth to slow from its estimate of a 6 percent increase in 2011.
" South African producers are suffering from high costs due to lower ore concentration, leading to deeper drilling, and an increase in energy costs," it said.
" For 2012 we expect output to grow by around 3 percent to 206 tonnes as investment in South Africa and Zimbabwe become operational." (Editing by Keiron Henderson and Jane Baird)
By Ryan SchwimmerFebruary 3, 2012UNEMPLOYMENT DIPS IRAN ADDS TO TENSION WITH U.S. U.S. stock futures added to early morning gains after the release of the latest unemployment figures. Analysts had estimated that 121,000 jobs were added in January, but the report showed 243,000 new jobs, plus adjusted figures for November and December showing a combined 60,000 additional new jobs. The unemployment rate fell to 8.3%, and most are seeing this as a good sign for economic recovery in the country. Gold and Silver dipped slightly on the news, but the dip may be limited, as the dollar also fell after the report’s release.
Mark Mobius, executive chairman of Templeton Emerging Markets Group, said he is now bullish on the eurozone thanks to Eastern European countries such as Austria and Romania. He said that investors are beginning to realize that the EU and the euro are here to stay. “Reforms are taking place now in Europe the effects will kick in next year, and then you’re going to see a much stronger regional community,” Mobius said.
Iran’s supreme leader Ayatollah Ali Khamenei warned those who are enforcing an oil embargo against Iran. Khamenei said, “Sanctions will not have any impact on our determination to continue our nuclear course. … In response to threats of oil embargo and war, we have our own threats to impose at the right time.” The comments are expected to continue driving up oil prices, and Gold traditionally has had a positive correlation with oil. Geopolitical tension is one of the major driving factors for the Gold price, as well.
At 8 a.m. (CST), the APMEX precious metals spot prices were:
- Gold - $1,755.80 – Down $2.10.
- Silver - $34.22 – Down $0.03.
Silver Market Update
Published : February 01st, 2012
503 words - Reading time : 1 - 2 minutes An important reversal has now completed in silver and it is in the early stages of what promises to be a powerful uptrend that should take it comfortably to new highs.
On its 7-month chart we can see how just over a week ago it broke out from its small Head-and-Shoulders bottom, an event which we had anticipated, havingoberved it stealthily breaking out from its bullish Falling Wedge downtrend simply by trading sideways for a number of days, which observation was put to good use by us piling into silver bull ETFs just ahead of the H& S breakout. This past week, emboldened by gold's important breakout and robust action in PM stocks, silver has followed up by advancing through the resistance level shown, although given that it is now becoming substantially overbought short-term, as shown by its RSI indicator, it would not be surprising to see it drop back temporarily beneath this resistance again. Overall, however, the picture has become strongly positive, so it may do no more than pause briefly before continuing still higher.
The long-term charts for silver are much more chaotic than those for gold, where we have very well defined inner and outer trend channels since the 2008 lows, which gold has adhered to with an almost religious zeal. The best channel fit we can find for silver is shown on the 5-year chart below - if anyone knows of a better one, drop me a line - I'll be interested to see it. If this channel is correct, or close to correct, and common sense dictates that it is, then the prospects for silver are very good here, as it is likely to advance towards either of the upper channel return lines shown on the chart, which would certainly result in handsome gains from the current price, and such an advance would be congruent with the bullish outlook for gold set out in the parallel Gold Market update.
The fundamental reasons for the suddenly rosy outlook for Precious Metals, and commodities generally, are set out briefly in the Gold Market update, and for ease of reference, the relevant paragraph is repeated below...
In this modern age of market manipulation and meddling, politicians are not prepared to give the forces of capitalism free rein to do their necessary work of straightening out distortions, since that conflicts with their agenda. Thus, instead of letting European banks collapse, the Fed has decided to rescue them with " back door" QE dressed up as swaps etc - the reason is, as you might expect, not altruistic - if the European banks collapse, they will drag down the US banks, and as the US banks are the Fed's masters and the bosses of the entire system, that cannot be allowed to happen, whatever the cost elsewhere. That is why the markets are rallying again across a broad front and why the outlook for gold and silver, and commodities generally, is once again bright, for the European bailout means money creation - and inflation.
Last Updated : 03 February 2012 at 12:30 IST
Time to buy gold
it is on the way to $5,000 in the next 3 or 4 year
LONDON (Commodity Online): Global financial worries to push gold prices above $2,000 an ounce in 2012 and even higher in the next few years, said Schaeffer Collins Chief Executive George Schaeffer.Schaeffer also said major Gold mining companies should increase dividends to attract investors. Shareholders currently are not getting the kind of returns they should expect with the Gold price so high.
“Gold (company) shares are undervalued and the gold price is going higher because of all the financial uncertainties. You will see a continued shift of investors putting more of their portfolios into gold. Time to buy gold, it’s on its way to $5,000 in the next three or four years,” Schaeffer concluded.
Last Updated : 03 February 2012 at 11:05 IST
Gold: Chinese and Indian demand surging, 2012 Indian import exceed average
By Adrian Ash
The wholesale market Gold price slipped 0.5% from a new 8-week high in London Thursday morning, while global stock markets stalled after a 3-day rise and commodities also edged back.
The Euro fell from $1.32 on the forex market for the third time this week after chief finance minister Jean-Claude Juncker said new proposals for stemming the currency zone's debt crisis – agreed at a summit on Monday – were " largely insufficient" .
The gold price in Euros touched €43,900 per kilo, a level breached only five times during the surge to all-time record highs of summer last year.
Beijing meantime said China's full-year gold mining output in 2011 – all of which was bought domestically, since exports are banned – hit a record 361 tonnes, a rise of 5.9% on 2010.
China's 2011 gold imports may have reached 490 tonnes, perhaps twice the 2010 level, according to Credit Suisse.
So far in 2012, imports of Gold Bullion to India – the world's No.1 consumer – have been " significantly above average" reports UBS strategist Edel Tully, despite last month's doubling of import duties.
February 02, 2012 • 18:17:25 PSTBernanke is defending the Fed's financial repression of savers today. He also says there are no signs of higher inflation... Read More
February 02, 2012 • 18:00:10 PSTA compilation of the week 4/5, 2012 leading [unconventional] commentary - Week 4, January 2012 Read More
February 02, 2012 • 15:12:46 PST...commodities which saw significant divergence with Silver (best today) and Gold surging (up around 1.15% on the week)... Read More
February 02, 2012 • 17:55:37 PSTStop us when this sounds familiar: 'While we expect central banks globally to continue to provide liquidity, it is the ECB’s position... Read More
February 02, 2012 • 14:49:29 PSTReuters reported gold had its best January since 1980, due to U.S. dollar weaknesses & the Federal Reserve's statement that it would keep U.S. rates n... Read More
February 02, 2012 • 14:37:25 PSTMany commentators see the eventual promotion of the Chinese currency as the global reserve unit to replace the ever-declining dollar... Read More
By Peter LaTonaFebruary 2, 2012Gold & Silver Up Ahead of Jobs ReportWhile the stock market was relatively flat in anticipation of Friday’s government monthly employment report, gold and silver experienced solid gains on the day. Of course, rising gold and silver prices might have more to do with remarks by Federal Reserve Chairman Ben Bernanke. Testifying before Congress,Mr. Bernanke defended Fed policy against harsh criticism that recent Fed decisions risked igniting inflation. Mr. Bernanke defended these decisions as necessary in a still struggling economy. He further stated that our sluggish economy is vulnerable to shocks.
Chinese Premier Wen Jiabao has raised the prospect that China might be willing to provide assistanceto the euro – bailout efforts. Reportedly, he told German Chancellor Angela Merkel that China might be willing to consider funding the European Stability Mechanism through the International Monetary Fund. Premier Wen Jiabao said that China “investigating and evaluating ways, through the IMF, to be more deeply involved using the ESM and EFSF channels in solving the European debt issue.”
At 4PM the APMEX precious metal prices were:
- Gold price - $1,757.50 – up $9.50
- Silver price - $34.31 – up 43 cents
Gold headed for 5th winning week US data eyed
SINGAPORE, Feb 3 (Reuters) - Gold prices held steady
on Friday, on course for a fifth straight week of gains, as
investors await a key U.S. labour market report after upbeat
jobless claims data in the previous session helped send spot
gold to a two-month high.
FUNDAMENTALS
* Spot gold was little changed at $1,758.14 an ounce
by 0042 GMT, on course for a 1-percent gain from a week earlier.
It hit a two-month high of $1,760.96 on Thursday.
* U.S. gold edged up 0.1 percent to $1,761.60,
headed for a 1.5-percent weekly rise.
* Spot palladium hit a 4-1/2-month high of $713.50,
before easing to $710.05.
* The U.S. non-farm payrolls data, due at 1330 GMT, is
expected to show that U.S. employment growth probably slowed in
January as messengers hired during the busy holiday shopping
season were laid off, but the improving labor market trend
should remain intact.
* Data showed that new claims for unemployment benefits in
the United States fell more than expected last week, pointing to
further healing in the nation's battered jobs market.
* Talks between Greece and its international lenders dragged
on, with euro zone finance ministers aiming to agree on a second
financing package on Monday.
* SPDR Gold Trust, the world's largest gold-backed
exchange-traded fund, said its holdings rose nearly half a
percent to 1,277.135 tonnes by Feb 2 -- their highest since
Dec.20.
MARKET NEWS
* Investors largely took a wait-and-see approach on Thursday
as U.S. stocks ended little changed ahead of Friday's key
employment report, but tech shares rose after strong earnings
from chipmaker Qualcomm.
* Major global currencies marked time early in Asia on
Friday, as investors retreated to the sidelines ahead of a U.S.
jobs report that could reinforce the recent improvement in risk
sentiment, or unravel it.
DATA/EVENTS
0858 EZ Markit Services PMI Jan
1330 U.S. Non-farm payrolls Dec
1500 U.S. Factory orders Dec
2030 U.S. CFTC commitment of traders data Weekly
February 02, 2012 • 08:54:38 PSTGold and Silver since Bernanke speech began:Read More
February 02, 2012 • 08:40:30 PSTSilver is making its intention to pass the $50 level clear. Read More
By Ryan SchwimmerFebruary 2, 2012BERNANKE WARNS CONGRESS OF ‘SUDDEN FISCAL CRISIS' Precious metals prices gained this morning amid a speech by Federal Reserve Chairman Ben Bernanke.Bernanke warned Congress that unless fiscal policy is on a sustainable path, this country is at a risk of a sudden fiscal crisis. “Although historical experience and economic theory do not indicate the exact threshold at which the perceived risks associated with the U.S. public debt would increase markedly, we can be sure that, without corrective action, our fiscal trajectory will move the nation ever closer to that point,” Bernanke said.
Gold may also be benefiting from other factors. Commodity demand was boosted by the U.S. jobless claims report, which showed that claims fell last week. Scott Gardner, chief investment officer at Verdmont Capital SA, said, “When economic news comes in better than expected, it boosts commodities, including Gold, as deflationary concerns subside.” Gold demand in India is significantly above average, according to UBS. India has been the largest Gold consumer in the world in recent years. UBS added that new investors are coming into the Gold market for the first time in three months, thanks largely in part to the potential for quantitative easing. Edel Tully, a UBS analyst, said that such easing could give Gold “explosive ingredients” in 2012.
At 9:44 a.m. (CST), the APMEX precious metals spot prices were:
- Gold - $1,757.20 – Up $9.20.
- Silver - $34.20 – Up $0.32.
Gold climbs towards 8-week high as stocks rise
* Gold holds near highest since Dec. 8
* U.S. jobs data helps risk appetite, lifting stocks
* Platinum prices near 2-1/2 month high (Updates prices, adds comment)
By Jan Harvey
LONDON, Feb 2 (Reuters) - Gold prices rose on Thursday, approaching their earlier eight-week peak above $1,750 an ounce, as a larger than expected fall in new U.S. claims for unemployment benefit lifted stock markets and helped pull the dollar off highs versus the euro.
The precious metal has risen nearly 12 percent this year, supported by the Federal Reserve's announcement that it would hold U.S. interest rates at rock bottom for an extended period. The move is set to keep the dollar under pressure and the opportunity cost of holding non-interest bearing bullion low.
Spot gold was up 0.2 percent at $1,747.00 an ounce at 1440 GMT, while U.S. gold futures for February delivery rose $1 an ounce to $1,750.50. Gold earlier peaked at $1,753.20, its highest since Dec. 8.
" Gold's fundamentals are strong and the recent rebound in risk appetite has encouraged investors to come back to the market or add to their existing positions," said Anne-Laure Tremblay, an analyst at BNP Paribas.
" Anecdotal evidence suggests that bar and coin demand remains high in the U.S. and Europe, with physical gold being bought as a safe haven," she added. " We expect gold to reach new highs in 2012, although episodes of extreme risk aversion may trigger corrections along the way."
Stock markets rose after data showed new claims for U.S. unemployment benefits fell last week, pointing to a further recovery in the battered jobs market.
European shares and the euro bounced around in choppy trading on Thursday as investors weighed concerns about efforts to reach a deal to bailout Greece with optimism over signs of fragile economic growth.
Worries over the euro zone debt crisis had driven gold sharply higher for much of last year even as they weighed on the euro. Towards the end of the year, however, the metal behaved more like a commodity, tracking equities lower as risk appetite retreated and suffering from strength in the dollar.
Underlying confidence in its ability to push higher in a low interest rate environment has allowed it to rise this year even in times when other assets are under pressure.
" While gold's 20-day rolling correlation with risk has jumped back into positive territory, the level continues to hover near the lower end of the range," said UBS in a note.
" Gold appears in the process of convincing investors that its stint as a hybrid between a safe haven and a risk asset is coming to an end. The next test would be if we get any negative surprises out of Europe."
PLATINUM HOLDS NEAR 2-1/2 MONTH HIGH
On the physical markets, demand by the world's biggest gold consumer, India, edged higher as strength in the rupee made the precious metal cheaper for local buyers. The wedding season is underway in India and will last until May.
The biggest global producer of gold, China, said its production of the metal rose to a record 360.95 tonnes last year. Its domestic demand far outstripped that figure, however.
Silver was up 0.1 percent at $33.73 an ounce. Spot platinum was up 0.4 percent at $1,618.49 an ounce, while spot palladium was up 0.4 percent at $696.75 an ounce.
Platinum has outperformed gold so far this year, rising nearly 16 percent since end December. As well as benefiting from rising appetite for commodities, the metal has taken support from expectations that South African production could be disrupted this year by mine stoppages.
Price-positive news also filtered through from the demand side of the market. Most platinum and palladium is consumed by the car industry for use in catalytic converters.
" Platinum and palladium benefited yesterday from better than expected vehicle sales figures in the United States," said Commerzbank in a note.
" On an annualised and seasonally adjusted basis 14.13 million vehicles were sold in January, almost 12 percent more than in the previous year." (Reporting by Jan Harvey editing by William Hardy)
