Precious Metals Overview

Gold futures gained for a second session on Thursday, hitting a three-week high as the euro gained after comments from the European Central Bank calmed investors worried about the currency union’s banking crisis. The most actively traded gold contract, for August delivery, rose $7, or 0.4%, to settle at $1,615.10 a troy ounce on the Comex division of the New York Mercantile Exchange, the highest settlement price since July 3. “Within our mandate, the ECB is willing to do whatever it takes to preserve the euro and, believe me, it will be enough,” ECB President Mario Draghi said at a conference in London. The euro advanced against the U.S. dollar after Mr. Draghi’s comments, reaching the highest point since July 10. Gold and the dollar tend to move inversely. Gold had settled at a two-week high on Wednesday, boosted by hopes that the Federal Reserve would ease monetary policy in an effort to prop up flagging U.S. economic growth. Such measures can raise the odds of inflation down the line, lifting demand for gold as a currency hedge. “We’ve got expectations that the Fed is going to do something or at least say something next week, and there’s talk that China is ready” to implement new easing steps, said Frank Lesh, a broker at FuturePath Trading. Adding the chance that the ECB may take new steps in the wake of Mr. Draghi’s comments, Mr. Lesh said that “you have the three central banks of the world’s largest economies maybe going to throw some more money at the problems.” Europe’s banking crisis has been a drag on gold prices this year, with worried investors generally seeking safety in the U.S. dollar at the expense of precious metals. “Gold has shown itself sensitive to monetary policy announcements this year and any indication of further easing would buoy gold prices, we believe,” said James Steel, an analyst with HSBC, in a note. Central banks in Russia and Kazakhstan both made large additions to their gold holdings in June, according to International Monetary Fund data. Russia’s central bank added 216,000 ounces of gold in June, while Kazakhstan bought for a seventh consecutive month, adding 50,000 ounces. Central banks in emerging economies have typically been buyers of gold in the last two years, bulking up their holdings of the precious metal in response to the debt crises in the U.S. and Europe, home to the world’s top two reserve currencies. Jamie Sokalsky, chief executive of top gold producer Barrick Gold Corp., said on Thursday that central bank buying, among other factors, has supported the gold price as mine output appeared to stagnate. “Certainly, the macroeconomic environment” is supportive, he said in an interview with The Wall Street Journal, citing “central banks buying gold, China and India being big purchasers of gold, against the backdrop of a likely flat supply from the mining industry and, perhaps, declining” output.
Great Southern Coins

DISCLAIMER: Trading precious metals could involve sizable risk. Sizable fluctuations in prices can and do occur frequently. In no event should the content of this website be construed as an express or implied promise, guarantee or implication by Great Southern Coins that you will profit or that losses can or will be limited in any manner whatsoever. Past results are no indication of future results. Information provided on this site is intended solely for informative purposes and is obtained from sources believed reliable.

Precious Metals Overview

Tuesday, July 24, 2012

Gold prices fell more than 1 percent on Monday as concerns over Spain’s financial health pushed the euro to two-year lows against the dollar, pressured stock markets and drove Spanish borrowing costs to euro-era highs. Investors grew more concerned on Monday that Spain may need a full bailout after a second region, Murcia, indicated it would need government help, likely following Valencia in tapping a government program to shore up its finances. Gold recovered from lows with the euro after the International Monetary Fund said it will start discussions with the Greek authorities on July 24 on how to bring Greece’s economic program back on track, but remains under heavy pressure from losses in the euro and stock markets. Spot gold was down 0.9 percent to $1,570.30 an ounce at 1347 GMT. Expectations for more euro weakness, and consequent dollar strength, is set to keep gold on the back foot. The euro slid to its weakest since June 2010 against the dollar and a near 12-year trough against the yen on concerns Spain will have to seek a full sovereign bailout, while European shares were down 2 percent after Spain’s financial outlook took a turn for the worse. “The dollar will stay strong with all these fears and the spike in bond yields we’re seeing, certainly for the time being,” Societe Generale analyst Robin Bhar said. “So gold will continue to underperform and we should see another test of the lows again over the slow summer period.” “I think gold will stay weak until the usual September to December period, when it does tend to do better,” he added. Other commodities also weakened, with crude oil falling as much as $4 a barrel, while copper slid to a three-week low. Spanish media reported that up to six regions may seek aid from the central government after Valencia asked for funds on Friday, sending yields on all Spanish government bonds sharply higher and 10-year debt to a euro-era high of over 7.5 percent. From a technical perspective, gold is set to find support around $1,559/1,560, according to analysts who study past price patterns to determine the future direction of trade. Prices have held within a $1,525-1,675 range for more than three months. Holdings of the world’s largest gold-backed exchange-traded fund, the SPDR Gold Trust dropped for a fourth consecutive week after a 2.4 ton outflow on Friday, down 15 tonnes, their biggest weekly decline since late December. Gold demand from major consumers India and China also remained weak, analysts said. “Our sales to India do not indicate any improvement as yet and neither does combined gold volumes on the Shanghai Gold Exchange, which have been 30 percent below average this month,” UBS said in a note. “Evidence of a significant response from physical buyers is needed first, before the investment community can be expected to follow suit.” US gold futures for August delivery were down $13.60 an ounce at $1,569.20. Silver was down 1.9 percent at $26.77 an ounce, while platinum was down 1.5 percent at $1,389.49 an ounce and palladium was down 1.4 percent at $563.25 an ounce. Trade data from China, a major market for industrial precious metals, showed a 23.6 percent year-on-year drop in silver imports in June, a 29.6 fall in palladium imports, and a 31.8 percent rise in platinum inflows. In the year to date, imports of all three metals are down. Concerns over supply did little to support platinum prices. The world’s biggest miner of the metal, Anglo American Platinum, said on Monday it is cutting its 2012 refined production target to 2.4-2.5 million ounces. Acting chief executive Bongani Nqwababa told a results presentation he would not “tolerate unprofitable ounces,” a signal the group could move to close loss-making shafts.
Great Southern Coins

DISCLAIMER: Trading precious metals could involve sizable risk. Sizable fluctuations in prices can and do occur frequently. In no event should the content of this website be construed as an express or implied promise, guarantee or implication by Great Southern Coins that you will profit or that losses can or will be limited in any manner whatsoever. Past results are no indication of future results. Information provided on this site is intended solely for informative purposes and is obtained from sources believed reliable.

Precious Metals Overview

Tuesday, July 6, 2012

Gold futures eased on Thursday as investors moved to the U.S. dollar after the announcement of interest-rate cuts from the European Central Bank. The most actively traded gold contract, for August delivery, fell $12.40, or 0.8%, to settle at $1,609.40 a troy ounce on the Comex division of the New York Mercantile Exchange. Gold had gained earlier this week in anticipation that world central banks would ease monetary policy in an effort to steady the financial system after global growth slowed. Some investors turn to precious metals as hedges against the inflation that can result from such policies. But there were few surprises from the European Central Bank in its rate cuts announced on Thursday, and gold sold off as traders flocked to the dollar. The move may stoke inflation down the line, said George Gero, vice president and precious metals strategist with RBC Capital Markets. But for now, it is “a signal of a snail’s-pace recovery” and unlikely to bring rising prices soon. “The [gold] market had priced” the ECB’s moves, said Frank McGhee, head precious metals dealer with Integrated Brokerage Services. “The interest-rate cut is weakening the euro. That re-creates the race of who can run their currency down the fastest.” With the Bank of England and China’s central bank also announcing monetary easing steps on Thursday, the U.S. dollar seemed to be losing that race. The ICE U.S. Dollar Index, which tracks the dollar against currencies of some major U.S. trading partners, jumped to the highest level since early June on Thursday as the easing steps elsewhere raised the prospect that those currencies would weaken. Gold can move inversely to the dollar, as a rise in the dollar makes dollar-denominated gold appear more expensive for buyers using other currencies. After dipping below the psychologically important $1,600 an ounce mark early in New York floor trading, gold futures pared their losses as the euro bounced from its lows against the dollar. Comex floor trading was closed on Wednesday for the U.S. Independence Day holiday.
Great Southern Coins

DISCLAIMER: Trading precious metals could involve sizable risk. Sizable fluctuations in prices can and do occur frequently. In no event should the content of this website be construed as an express or implied promise, guarantee or implication by Great Southern Coins that you will profit or that losses can or will be limited in any manner whatsoever. Past results are no indication of future results. Information provided on this site is intended solely for informative purposes and is obtained from sources believed reliable.

Precious Metals Overview

Tuesday, July 3, 2012

Gold futures eased Monday as investors weighed whether the European Union’s latest crisis-fighting plan would soon ease the pressure on the bloc’s banking system. Gold futures surged Friday along with the euro and other commodities, rising 3.5% after EU leaders announced plans to let the euro zone’s rescue fund directly recapitalize troubled banks and make the European Central Bank the region’s banking supervisor. But many commodities pulled back on Monday as investors second-guessed whether the steps would have an immediate effect on Europe’s rattled banking system. The euro fell against the U.S. dollar amid reports that the Netherlands and Finland plan to block pieces of the rescue package agreed to last week and data showed continued weakness in global economic activity. The most actively traded gold contract, for August delivery, fell $6.50, or 0.4%, to settle at $1,597.70 a troy ounce on the Comex division of the New York Mercantile Exchange. The euro was recently at $1.257, down from $1.266 late Friday in New York. Gold tends to suffer from a stronger U.S. dollar, as it makes the dollar-denominated futures appear more expensive for buyers using other currencies. Gold prices have typically retreated this year when traders were worried about a potential freeze in Europe’s financial system, choosing the flexibility of cash, and particularly the U.S. currency. Precious-metals markets are “waiting for a more comprehensive and strategic solution to the crisis,” analysts with Bank of America Merrill Lynch said in a note. “Such a move would likely be accompanied by loose monetary policy and higher inflation in northern Europe, which would benefit precious metals specifically.” Gold can benefit from easy-money policies, as investors seek to shield their wealth from the inflation that more liquidity in the financial system can bring. Much of gold’s weakness this year, analysts say, has come as a result of the Federal Reserve and European Central Bank refraining from taking new crisis-fighting steps. Precious metals were also under pressure on Monday from a slate of weak global economic data. A reading on manufacturing activity in the U.S. showed contraction in the sector for the first time since 2009. Similar readings in the euro-zone and China also showed industrial activity weakening. A “general economic slowdown in Europe and Asia is going to hurt gold sales,” said Sterling Smith, a commodity analyst with Citi’s Institutional Clients Group.
Great Southern Coins

DISCLAIMER: Trading precious metals could involve sizable risk. Sizable fluctuations in prices can and do occur frequently. In no event should the content of this website be construed as an express or implied promise, guarantee or implication by Great Southern Coins that you will profit or that losses can or will be limited in any manner whatsoever. Past results are no indication of future results. Information provided on this site is intended solely for informative purposes and is obtained from sources believed reliable.

Precious Metals Overview

Tuesday, June 26, 2012

Gold futures rallied Monday as investors adjusted their holdings ahead of gold options expiration Tuesday and on U.S. economic data pointing to weaker growth. The most actively traded contract, for August delivery, gained $21.50, or 1.4%, at $1,588.40 per troy ounce on the Comex division of the New York Mercantile Exchange. Gold’s rally benefited from investors looking to purchase long gold futures, or bets on higher prices, ahead of the Comex gold options expiration, said George Gero, senior vice president with RBC Capital Markets Global Futures. For many investors who had sold protective options around the psychologically important $1,600 level, these positions will turn into short July-delivery gold futures, or bets on lower gold prices, at the end of business Tuesday. These traders have rushed to purchase long gold futures in order to avoid large trading margin requirements by offsetting the short positions due to hit their account, Mr. Gero said. Investors are required to put down a deposit of $9,113, known as a trading margin, for each futures contract. “Most options traders do not want to put up that kind of margin money,” Mr. Gero said. Gold prices also caught a boost from data showing the Federal Reserve Bank of Chicago’s National Activity Index declined in May. The gauge of national economic activity fell to -0.45 last month from a revised 0.08 in April, indicating slowing growth. A negative reading for the activity index, a compendium of available and forecast economic data, points to below-trend growth. Gold prices have rallied on weaker U.S. economic data in recent weeks amid hopes that the Federal Reserve will pump more money into the economy. While the central bank disappointed investors last week, opting to restructure rather than expand its balance sheet, downbeat reports continue to stoke these hopes. “Our economists see this as the Fed buying time and weighing future options, and continue to expect further accommodation before year-end,” said Anne-Laure Tremblay, a precious metals analyst with BNP Paribas, in a note. Elsewhere, the amount of gold held as security by the Bank for International Settlements fell 7.5% to 19.6 billion worth of Special Drawing Rights for the financial year, the bank said in its annual report. About 9% of the SDR 215.4 billion in customer placements are currently held in gold, while the vast majority of customer placements are denominated in currencies, the BIS said.
Great Southern Coins

DISCLAIMER: Trading precious metals could involve sizable risk. Sizable fluctuations in prices can and do occur frequently. In no event should the content of this website be construed as an express or implied promise, guarantee or implication by Great Southern Coins that you will profit or that losses can or will be limited in any manner whatsoever. Past results are no indication of future results. Information provided on this site is intended solely for informative purposes and is obtained from sources believed reliable.

Precious Metals Overview

Tuesday, June 22, 2012

Gold prices fell sharply Thursday, settling at their lowest level since May as the U.S. dollar strengthened and a spate of macroeconomic data came in mostly negative. Manufacturing activity in the Philadelphia area contracted sharply, falling to its weakest level since August, and sales of existing homes fell 1.5% in May as there were fewer lower-priced homes available. Also, a report on weekly U.S. jobless claims pointed to a still ailing job market, and an initial survey by investment bank HSBC showed China’s manufacturing activity in June at its lowest level in seven months. Gold futures for August delivery dropped $50.30, or 3.1%, to $1,565.50 an ounce on the Comex division of the New York Mercantile Exchange. That was gold’s sharpest decrease since early April. “People are shedding risk assets“ and gold has been unable to consistently regain its status as a safe-haven asset, said Matt Zeman, head trader and strategist at Kingsview Financial in Chicago. “The longer trend now still remains lower (with) gold trading as any other risk asset out there.“ Open interest in gold has been lagging and recent rallies were mainly short-covering, said George Gero, a vice president with RBC Wealth Management, in emailed comments. Investors will have to brace for upcoming margin calls after the 50-dollar decline, and “longer term we need a few weeks of stable prices after all this volatility to look for a new trading range,” he added. Gold fell $7.40 in the previous session, when the Federal Reserve dashed hopes of more aggressive stimulus measures. A stronger dollar kept the pressure on gold and other commodities, with the ICE dollar index, which measures the greenback’s performance against a basket of six major currencies, reaching the day’s highs around the time gold closed. The index was recently up at 82.296 from 81.567 in late North American trading Wednesday. The Fed disappointed investors, adding to gold’s woes, Zeman said. After a two-day meeting ended Wednesday, the Federal Open Market Committee said it will extend a program to replace its purchases of shorter-term securities with longer-term bonds in a bid to lower interest rates at the far end of the yield curve. But the Fed gave a subdued economic outlook and didn’t suggest more monetary easing was in the offing.Other metals tracked gold lower, with July silver stumbling $1.55, or 5.5%, to $26.84 an ounce. Copper for the same month’s delivery retreated 9 cents, or 2.6%, to $3.30 per pound. July platinum declined $28.20 an ounce, or 1.9%, to $1,438.60 an ounce. Sister metal palladium, for September delivery, was off $10.95, or 1.8%, to $608.55 an ounce.Great Southern Coins

DISCLAIMER: Trading precious metals could involve sizable risk. Sizable fluctuations in prices can and do occur frequently. In no event should the content of this website be construed as an express or implied promise, guarantee or implication by Great Southern Coins that you will profit or that losses can or will be limited in any manner whatsoever. Past results are no indication of future results. Information provided on this site is intended solely for informative purposes and is obtained from sources believed reliable.

Precious Metals Overview

Tuesday, June 19, 2012

Gold was under pressure in Asian trading Monday, but pared some early losses, with the market now expecting the metal to take cues from a Federal Reserve meeting this week. Some traders attributed the initial dip in prices to profit-taking after news that a pro-bailout party in Greece will be forming the government, dispelled fears of an immediate Greek exit from the euro zone.  Spot gold was at $1,622.50 a troy ounce, down $4.20 from its previous close. Earlier in the session it fell to $1,607.15/oz, but quickly rebounded. “Prices could dip back towards $1,600/oz, but while the immediate cause for concern has abated, the broader crisis in the region persists, which should underpin investor appetite for hard assets,” ANZ analysts said in a note. “Elections in Greece happened on Sunday…we haven’t seen Europe and the U.S. trade as yet,” a trade official based in Perth said. He expects gold to take direction from the Federal Open Market Committee’s meeting June 19-20. Any announcement about monetary easing following a string of weak economic indicators in the U.S. could push gold higher, he said. When an earlier round of quantitative easing was announced in November 2010, it pushed gold to a record high as more money was pumped into the financial system. Some market participants said there will be disappointment if the Fed doesn’t announce any easing, but Stan Shamu of IG Markets said the Fed will likely make some comments on the post-election economic scenario in Greece. Gold’s price direction will now depend on “how dovish the comments are,” Shamu said. He noted that $1,600/oz remains a key psychological support. Silver mostly traded in a range after touching an intraday high of $29.02/oz.  Spot silver was at $28.63/oz, down 11 cents from its previous close. Spot platinum was the strongest performer in the complex, followed by palladium. Standard Bank analyst Leon Westgate said platinum prices may move higher, “perhaps touching $1,550/oz in the next few days.” Spot platinum rose 1.6% to $1,503/oz Monday, the highest in the session so far. “This would not be on the back of strong real demand, but rather on the back of short-covering,” Westgate said. Platinum may find additional support should gold manage to breach its resistance level of $1,630/oz, he added. Spot platinum was at $1,490.75/oz, up $10.75, while palladium was at $630.75/oz, up $5.75.—Great Southern Coins

DISCLAIMER: Trading precious metals could involve sizable risk. Sizable fluctuations in prices can and do occur frequently. In no event should the content of this website be construed as an express or implied promise, guarantee or implication by Great Southern Coins that you will profit or that losses can or will be limited in any manner whatsoever. Past results are no indication of future results. Information provided on this site is intended solely for informative purposes and is obtained from sources believed reliable.