Gold – Interesting and Sleepy

Gold – Interesting and Sleepy

Commentary for Tuesday, October 22, 2019 – Gold closed down $0.70 today at $1481.70 and then moved up $6.00 in the aftermarket. Again, it seems quiet in the precious metals market but there are undercurrents. But there is not much fresh news out there to “push” safe haven demand.

The 30 day pricing chart remains “middle of the ground” in that this past month gold broke down at $1530.00 falling dramatically looking at $1470.00 in late September. Still the route was stopped and it bounced nicely higher but not convincingly, if you know what I mean.

Yes the price of gold firmed but it lacked substance above $1500.00 and has since traded off bouncing higher at $1480.00 on what I think is simply a small round of short covering.

This is an old story in that while the fear factor is moving lower – Trump and Chinese seem to be getting along better and Wall Street stocks remain firm the dollar trending lower supports the price of gold but is not creating any buzz. It’s actually surprising that given this past month the Dollar Index has lost nearly 2 points and gold has still not found its footing.

I think speculative short paper senses an opportunity here but just can’t muster the courage of its convictions. Why? It may be that international stress, while diminished is still bothersome. The British for example just can’t seem to manage Brexit even though they have been banging away at this solvable problem for 3 years and the English want out of the EU.

It’s also worth noting that some of our trading partners think Trump is a loose cannon which obviously helps the gold trade. And even with this boring back and forth trading range the technical outlook for gold favors the bulls – up $250.00 this past year. 

There is a number of bigger bullion players which claim higher prices, perhaps even record highs will be seen next year. Still the notion that gold has turned flat around $1500.00 since last July takes the bubbles out of the champagne.

I’m happy gold seems to be holding its ground – but think fresh bullish news is needed to push higher. If over time the bulls cannot reinvigorate themselves gold pricing will continue to wonder – not too hot and not too cold, but still interesting. 

Finally watch possible interest rate changes. But this too remains tricky – some insiders think the FOMC will lower rates in late October or middle December – a modest ¼ point. Whether this is already factored into today’s price of gold remains to be seen – if it is and they decide to leave rates unchanged it could introduce more turbulence.     

This from Zaner (Chicago) – “Global markets started out with a mildly positive tone but have taken a negative shift coming into this morning’s action. Canada’s Parliamentary election has resulted in the ruling Liberal Party holding onto enough seats to have a ruling minority government. China’s Vice Foreign Minister said that as long as the US and China respect each other, there is no problem could that can’t be resolved. Asian shares generally finished in positive territory and were led by gains in the South Korean Kospi and Shanghai Composite indices. A September reading for UK public sector net borrowing came in slightly below forecasts. The UK government is expected to bring their current Brexit deal to a first vote in the UK Parliament later today. European shares were posting mixed results with the UK FTSE-100 posting a mild gain while the French CAC-40 and Italian MIB indices were showing modest early losses. The North American session will start out with a weekly private survey of same-store sales, followed by August Canadian retail sales that are expected to hold steady with July’s 0.4% reading. September existing homes sales are forecast to have a modest downtick from August’s 5.49 million annualized rate. The Richmond Fed’s October manufacturing index is expected to hold steady with September’s -9 reading. The Bank of Canada’s quarterly Business Outlook Survey will be released during mid-morning Canadian trading hours.

Gold and silver appear to be on a fulcrum, as some renewed optimism on trade is offering pressure but the upcoming Brexit vote(s) in Parliament is adding a level support. President Trump said China has indicated that negotiations over an initial trade deal are advancing, raising expectations the nations’ leaders could sign an agreement at a meeting next month in Chile. This followed comments yesterday from China Vice-Premier Liu expressed similar optimism. There are two crucial votes today in Parliament, one about accepting the Brexit agreement and the other regarding the timeline, and it would appear that gold could fall off sharply if the votes succeed and rally if the votes fail, especially since the deadline for the exit is only nine days away. ETFs were buyers of gold yesterday, and holdings have reached the highest level in 12 months. This is in contrast to managed money traders, who have liquidated some of their positons in recent weeks, and at least one commentator remarked that this is a recipe for volatility. Recent Fed commentary has been mixed about whether a rate cut is necessary, but the Fed Funds were giving an 87% chance of a 25 basis-point cut at the October 29-30 meeting yesterday. The IMF is estimating that the trade war between China and the US will reduce global growth to 3% in 2019, the slowest pace in a decade. Factors like potential rate cuts lurk in the background, but we expect the Brexit vote to be the most consequential event today.

December palladium has been consolidating since last week’s rally to new all-time highs, and the market appears well-positioned to make another breakout. Despite being technically overbought, there is no indicator of a top. Furthermore, some analysts and industry specialists expect tight supplies to continue through 2020. Look for support at $1,712.70 with resistance at $1,750 and the next round-number target up at $1,800. We would expect platinum to take its lead from gold today, and the Brexit vote could be consequential. Look for support in January platinum at $880 and $875.60 with resistance at $906.90.

The safe-haven impulse has been waning over the past week or so, but a failure in Brexit could spark some buying in gold today. On the other hand, the positive trade news is becoming a pressure point for the metals. Look for resistance in December gold at $1,503 and $1,508 with support at $1,480.60 and $1,478. Look for support in December silver at $17.18, with resistance at $17.895.”

Silver closed down $0.09 at $17.44.

Platinum closed up $3.80 at $892.30 and palladium closed up $3.20 at $1729.90.

We believe our four flat screens downstairs with live independent pricing are unique in the United States. The walk-in cash trade can see in an instant the current prices of all bullion products and a daily graph illustrates the range of the markets on any given day.

Yes – you can visit the store with cash and walk away with your product. Or you can bring product to the store and walk away with cash. We will also wire funds into your account that same day for a small fee ($25.00) if you are in a hurry.

In addition to our freshly ground coffee we offer complimentary cold bottled water, Cokes and Snapple. We also provide fresh fruit in a transparent attempt to disguise our regular junk food habits as we sneak down the block for the best donuts in the world (Randy’s). 

Like us on Facebook and follow us on Twitter @CNI_golddealer – have some fun.

We appreciate your friendship and business. Blessings and thanks for reading.           

Disclaimer – The content in this newsletter and on the GoldDealer.com website is provided for informational purposes only and our employees are not registered financial advisors. The precious metals and rare coin market is random and highly volatile so it may not be suitable for some individuals. We suggest before deciding on a course of action that you talk with an independent financial professional. While due care has been exercised in development and dissemination of our web site, the Almost Famous Gold Newsletter, or other promotional material, there is no guarantee of correctness so this corporation and its employees shall be held harmless in all cases. GoldDealer.com (California Numismatic Investments, Inc.) and its employees do not render legal, tax, or investment advice.

Posted on

Gold Moves Modestly Higher

Gold Moves Modestly Higher

Commentary for Wednesday, October 16, 2019 – Gold closed up $10.40 at $1488.00. It traded firm today as stocks moved lower on worries over the US/China problems and weak retail sales. The dollar is also weaker – the Dollar Index has lost a full point this past week which is always a plus for the price of gold.

But I think this week will be another round of shadow boxing – what does the FOMC have in mind and where are we when it comes to the USA/China trade talks. Both of these larger than life questions will push the price of gold and influence the technical picture.

The 30 day gold price picture still looks turbulent but manageable at something between $1470.00 and $1530.00. I actually like the notion that gold is beginning to settle and perhaps even lower prices still make the future tea leaves look good.

Keep an eye on the 1 year price picture. Since last October gold has moved up in a nice step pattern – $1200.00 through $1300.00 (with consolidation) through $1400.00 and finally stepping up to $1500.00, again with consolidation.

This pattern should be encouraging to the bulls considering that the primary forces which pushed gold higher are still unresolved and the Fed is having troubles figuring out whether two rate hikes this year will do the trick or we will need another shot in the arm in December.

Lower interest rates are good for gold prices, and our interest rates are still sky high relative to the negative rates prevalent in Europe today. For the US to remain competitive the Fed will be pushed into an even more liberal monetary policy – another quarter point cut might just be the beginning as funny as that may seem. This single fact will encourage the bulls.

Of course there are always “negatives” – even with gold settling there are some traders who feel this pricing action suggests a “coiling” as the moving averages get closer together. This technical term is used in trading to suggest a large move is in the making but it does not suggest direction.

In other words we could be getting ready for a large move either up or down. So this adds to the already common feeling that some are waiting for the next shoe to fall. This type of tension is typical when pricing patterns become tight for too long a period. And because gold is not charging higher it moves off the front page and momentum players get bored.

Higher current prices are both a blessing and a curse and the Asian trade remains price sensitive. India’s demand for physical gold in this year’s festival season is being questioned but I think this is premature. The Asian trade is not “out” they are just cautious because like everyone else they can’t figure out whether gold is “tired” and moving lower or just resting and will soon be ready to push this still classic bullish leg even higher.  

This from Zaner (Chicago) – “Global equity markets overnight were once again mixed with the number of markets lower slightly higher than the number of markets trading higher. There continues to be some hope of progress on the exit situation with negotiators working aggressively to avoid a harsh exit. While the US/Chinese trade talks are expected to continue with Deputy level discussions, one has to wonder if US legislation efforts by the US House of Representatives taking a hard line on China with respect to democracy protests in Hong Kong will derail trade talks. In fact China has already threatened retaliation over the US Hong Kong Bill and that could enter into the trade discussions. Overnight economic news included Italian industrial orders which came in softer than expected, Italian industrial sales which contracted off expectations for a slight gain and declining UK retail price index readings for September. It should also be noted that producer prices in the UK declined on a month over month basis while UK consumer price index readings managed a small 0.1% gain relative to expectations for a gain of 0.2%. Other price related information from Europe overnight included Italian consumer prices which contracted by a very significant 0.6% and euro zone consumer price index readings which matched expectations at 0.2%. The North American session will start out with a weekly private survey of mortgage applications, followed by September retail sales which are expected to see a minimal downtick from August’s 0.4% reading. September Canadian CPI is forecast to have a modest uptick from August’s 1.9% year-over-year. August business inventories are expected to have a modest downtick from July’s 0.4% reading. The October NAHB housing market index is forecast to hold steady with September’s 68 reading. The latest FOMC Beige Book and the August Treasury International Capital (TIC) report will be released during afternoon US trading hours. Chicago Fed President Evans will speak during morning US trading hours while Fed Governor Brainard will speak during the afternoon. Earnings announcements will include Bank of America, Abbott Labs, U.S. Bancorp and PNC Financial Services before the Wall Street opening while IBM and Netflix report after the close.

While the gold and silver markets yesterday showed some strength, both markets ultimately faltered and fell back in a fashion that leaves the charts in favor of the bears today. However the gold market is drafting some minimal support from rising US/Chinese political tensions following US House of Representatives measures designed to foster the democracy movement in Hong Kong. In fact the Chinese have indicated they will retaliate for the US meddling and that could serve to derail trade talks and thereby rekindle economic uncertainty. However it should be noted that gold prices in Hong Kong closed lower today. Holding back the gold market this morning are reports of sluggish Indian gold consumption last month, as that leads to fears that the strong demand season will not see noted buying. In fact reports suggest third quarter Indian imports were likely the worst third quarter since 2016 and that is even more bearish to prices when one considers the domestic discount expanded in September. We also see the wave of overnight price index readings from the UK and Europe as negative to gold and silver as base prices continue to be extremely week. Yet another negative for the gold market came from the Fed’s Daly who indicated that the Fed’s two rate cuts this year should be enough to maintain the economy as that dampens hope for 3rd rate cut this year. However traders should still be on the lookout for the release of the Fed’s Beige book later today and also on the watch for the Treasury International Capital flows report as those reports could figure into Fed decisions ahead. Clearly a better than expected kickoff to the US corporate earnings cycle has fostered macroeconomic optimism and that in turn has undermined sentiment toward gold and silver. It is also likely that ongoing optimism toward some type of improvement in the Brexit situation will continue to add to the downward bias in precious metals as the deadline is causing furious efforts to work out a deal. In another notable negative for gold and silver overnight ETF’s reduced holdings and broke the recent pattern of sequential inflows. Gold funds reduced holdings by 83,012 ounces while silver holdings were reduced by 2 million ounces. Lastly with burdensome net spec and fund long positions in both gold and silver, a violation of last week’s low at $1,478 in December gold and at $17.30 in December silver, it is likely that weak chart action could ignite another wave of stop loss selling. However the dollar did break out to the downside overnight but it appears that gold and silver will need very significant declines in the dollar just to provide a minor amount of support for prices.

The unrelenting climb in palladium continues with another fresh record high this morning which once again lifted prices above the even number $1,700 price level. Apparently demand expectations for advanced vehicles continues to outweigh the ebb and flow of overall global economic views, with the palladium market seemingly willing to accept the “best case” scenario with respect to the global economy and to the US/Chinese trade situation. While open interest continues to rise, palladium open interest still remains below the high level seen earlier in the year which suggests more buying fuel might remain on the sidelines. Uptrend channel support in December palladium today is seen at $1,683.45 with classic technical counts targeting $1,734. Once again the platinum market failed to benefit from the latest round of new highs in palladium with prices forging six day lows and drifting back down toward the middle of the last three weeks trading range this morning. Clearly the market is uninterested in the ongoing pattern of record platinum ETF holdings (a new record was posted again yesterday) perhaps because the PGM complex as a whole hasn’t had much experience with derivative holdings. Initial support in January platinum is seen down at $881.50.

Despite seeing initial gains in gold we think the path of least resistance is pointing down with economic sentiment narrowly hanging on to the risk on vibe. In fact, it would appear as if the gold trade is unconcerned with the lack of a formal US/Chinese trade deal, and with favorable US corporate earnings flow it appears as if economic sentiment has also improved. Therefore unless corporate earnings show some disappointment, US retail sales are surprisingly weak or US Congressional meddling in Hong Kong sparks a breakdown in trade relations, the bear camp holds an edge. We see very thin support in December gold down at $1,478 with a likely downside target of $1,472 in the event that earnings continue to come in positive and equities continue to mount modest gains. We see initial support in December silver at $17.30 and then again down at $17.24 in the event of more equity market gains.”

This from Kitco’s Jim Wyckoff – LBMA delegates see gold prices pushing past $1,650 an ounce next year – “Optimism within the precious metals industry remains strong as delegates at this year’s London Bullion Market Association Precious Metals Conference see even higher prices by this time next year.

As this year conference in Shenzhen, China wrapped up, attendees were asked where they see prices by this time next year. According to the unofficial poll, the delegates see gold prices rising to $1,658 an ounce, up nearly 11% from current prices.

As bullish as the participants were on the yellow metal, they are even more optimistic on silver. The attendees see nearly a three-fold rally in silver compared to gold.

The delegates see silver prices rising to $23 an ounce, representing a gain of 32%. With these forecasts, the gold/silver ratio is expected to fall to 72. December silver futures last traded at $17.405 an ounce, up 0.15% on the day.

Platinum is expected to continue to play catching up next year with the price forecasted to rise to $1,182, up 34% from current prices. Palladium’s hot streak is not expected to end any time soon as attendees see the metal pushing to $1,924 by next years, up 10% from its already record prices.

Although delegates are bullish on precious metals across the board, the analysts during a panel discussion said that prices might need a pause after the summer’s rally. The LBMA forecast has gained a bit more attention lately as last year’s forecast has proven to be fairly accurate.

Last year the conference poll said that attendees saw gold prices rising to $1,532 an ounce. The bullish outlook came at a time when gold prices were struggling to hold support above $1,200 an ounce. Earlier this summer, expectations of looser monetary policy and rising recession fears helped to gold prices rally more than 20% for the year, which prices hitting a six-year high above $1,560 an ounce. According to reports this is only the second time in the last 10-years that gold has seen a 20% rally. Although prices are off their highs, the gold market is still holding on to a 16% gain for the year.”

Silver closed up $0.04 at $17.35.

Platinum closed up $2.10 at $886.50 and palladium closed up $38.40 at $1736.40.

This is our usual ETF information – Gold Exchange Traded Funds: Total as of (10/8/2019) was 77,545,645. That number this week (10/16/2019) was 77,827,295 ounces so we gained 281,650 ounces of gold.

The all-time record high for all gold ETF’s was 85,108,867 ounces in 2013. The record high for Gold ETF’s in 2019 was 77,924,071 and the record low for 2019 was 67,430,173

Silver Exchange Traded Funds: Total as of (10/8/2019) was 715,500,555. That number this week (10/16/2019) was 713,112,557 ounces so we dropped 2,387,998 ounces of silver.

Platinum Exchange Traded Funds: Total as of (10/8/2019) was 3,109,929. That number this week (10/16/2019) was 3,127,408 ounces so we gained 17,479 ounces of platinum.

Palladium Exchange Traded Funds: Total as of (10/8/2019) was 656,327. That number this week (10/16/2019) was 666,338 ounces so we gained 10,011 ounces of palladium.

We believe our four flat screens downstairs with live independent pricing are unique in the United States. The walk-in cash trade can see in an instant the current prices of all bullion products and a daily graph illustrates the range of the markets on any given day.

Yes – you can visit the store with cash and walk away with your product. Or you can bring product to the store and walk away with cash. We will also wire funds into your account that same day for a small fee ($25.00) if you are in a hurry.

In addition to our freshly ground coffee we offer complimentary cold bottled water, Cokes and Snapple. We also provide fresh fruit in a transparent attempt to disguise our regular junk food habits as we sneak down the block for the best donuts in the world (Randy’s). 

Like us on Facebook and follow us on Twitter @CNI_golddealer – have some fun.

We appreciate your friendship and business. Blessings and thanks for reading.           

Disclaimer – The content in this newsletter and on the GoldDealer.com website is provided for informational purposes only and our employees are not registered financial advisors. The precious metals and rare coin market is random and highly volatile so it may not be suitable for some individuals. We suggest before deciding on a course of action that you talk with an independent financial professional. While due care has been exercised in development and dissemination of our web site, the Almost Famous Gold Newsletter, or other promotional material, there is no guarantee of correctness so this corporation and its employees shall be held harmless in all cases. GoldDealer.com (California Numismatic Investments, Inc.) and its employees do not render legal, tax, or investment advice.

Gold Turns Defensive

Gold Turns Defensive

Commentary for Friday, October 11, 2019 – Gold closed down $12.10 today at $1482.70. So it continues to settle as rumors of a Trump trade deal push stocks dramatically higher and gold lower.

Interestingly the dollar is also lower as the Fed plans to purchase Treasury bills at $60 billion per month – a move already talked about and another step into even looser monetary policy.

This is another great example of how “fluid” and in my opinion how precarious our current method of financing has become. With this latest T-Bill purchase the Fed will reverse the idea that it wants to shrink its balance sheet in a declared effort of not wanting to introduce “imbalance” in the financial system. 

And this latest move along another interest rate reduction by year end should sound at least a small alarm that the Fed is once again scrambling to hold its Rude Goldberg together.

Still Wall Street loves cheap money and the cheaper the better as Europe is also struggling with similar problems and yet in many cases lacks the infrastructure so their debt problems are more dangerous. It would seem that everyone has thrown fiscal conservatism out the window for now but longer term planners will appreciate that always raising the stakes is not planning.  

All of this last minute fiscal manipulation should come as no surprise. But it caught gold off-guard when it was already left-footed. Our shiny friend was already dealing with a technical price issue which began in early August.

Gold, which enjoyed a generally higher market with solid buzz turned flat – price momentum stalled and it became clear that it was having trouble making higher highs.

The problem with this scenario is that really no one can tell whether such a pattern represents the end of the party or suggests that gold was tired and needed time to consolidate – perhaps with more than one round of profit taking.

This uncertainty remains in place throughout the entire precious metal complex.

I do not believe gold or silver will suddenly fall out of bed over what Trump claims especially when dealing with the Chinese. They will never give him two fives for a ten – he wants real protection for our intellectual property and China will not deliver nor be bulled in the process.

So for now expect further settling and look for that important bargain hunting – most likely next week. This settling was expected and everyone further expects cheaper prices to reinvigorate the world appetite for physical gold. So stay tuned, as they say.

Keep in mind we will be closed this coming Monday for Columbus Day – commodity markets and the USPS will also be closed.       

This from Zaner (Chicago) – “Global equity markets overnight were higher off the hope of actual progress in US/Chinese trade talks, but also from fresh optimism on the prospect of forward movement on a Brexit deal. Overnight economic news included harmonized consumer prices in Germany which contracted slightly, unchanged inflation in Spain and a slight contraction in Japanese M2 money supply. The North American session will start out with a September reading on the Canadian jobs sector, with their unemployment rate expected to hold steady at 5.7% with a modest increase in their net employment. The September import price index and September export price index are both forecast to come in roughly in-line with their August year-over-year readings. A private survey of October consumer sentiment is expected to show a modest downtick from the previous 93.2 reading. Minneapolis Fed President Kashkari will speak during morning US trading hours while Boston Fed President Rosengren and Dallas Fed President Kaplan will speak during the afternoon. Earnings announcements will include Infosys and Fastenal before the Wall Street opening.

While the gold market has been bailed out early this morning by further weakness in the dollar and by the Iranian tanker attack, it would appear as if the prevailing environment will favor the bear camp today. In fact, with the top Chinese negotiator scheduled to meet with President Trump at the White House later today and equities showing noted early risk on action, early gains in gold and silver should dissipate. Certainly the tanker attack in the Middle East leaves a residual amount of safe haven support for metals prices in place but failure to hold the $1,500 level in December gold into the close today could result in a late wave of selling. In fact the most recent net spec and fund long in the gold market was still lofty at 337,429 contracts and therefore the violation of consolidation low support levels could produce knock on stop loss selling. Furthermore ETF gold holdings appeared to break their string of inflows with a Reuters measure of holdings noting a drop in gold holdings of 67,022 ounces yesterday. On the other hand, iShares silver holdings jumped by 1.44 million ounces overnight. Clearly the gold market was not in a position this week to benefit from news of reduced production as one of China’s biggest gold miners announced yesterday it would miss production targets for gold, but that production was still expected to make a year-over-year gain. The gold market obviously failed yesterday because of the swing in sentiment in favor of expectations of some trade progress this week and that in turn has lowered safe haven interest for gold, silver, Bonds and the Dollar. Unless the talks end without a small deal, the bear camp looks to have the edge.

Obviously platinum and palladium are continuing to benefit from ongoing positive trade headline flow, as prices leapt higher yesterday and managed the gains in the face of noted weakness in gold and silver. Clearly the markets were lifted as a result of the trade news as prices early yesterday showed no initial reaction to news that South Africa PGM output in August declined by 12.5% relative to year ago levels. However given improvement in both supply and demand fundamentals this week, and given fresh upside breakout action on the charts again this morning some technical systems have offered the next upside target at $1,739 in Palladium. The $1,739 objective is derived by measuring the width of the last month’s consolidation range and projecting that range on to the breakout price. While it is a little surprising to see the platinum market follow palladium higher, it should be noted that platinum forged its own consolidation breakout which projects prices up to $932.

As we indicated earlier in the week, we suggested those remaining long gold and silver should have sought out put protection for a temporary wash. However we suspect the wash in prices will continue for another trading session, as hope for a small deal looks to extend with a meeting between the highest-ranking trade negotiator and President Trump later today. We still see critical support remaining at $1,492.10 in gold and then again down at $1,490 but the euphoria of a deal could result in a temporary spike down to $1,480. In the silver market, we see important support down at $17.30 and a projected possible spike low on a euphoria event today down to $17.24.”

Silver closed down $0.06 at $17.46.

Platinum closed down $7.60 at $895.50 and palladium closed down $5.80 at $1671.50. 

Gold Turns Defensive

This is our usual ETF information – Gold Exchange Traded Funds: Total as of (10/2/2019) was 77,168,557. That number this week (10/8/2019) was 77,545,645 ounces so we gained 377,088 ounces of gold.

The all-time record high for all gold ETF’s was 85,108,867 ounces in 2013. The record high for Gold ETF’s in 2019 was 77,545,645 and the record low for 2019 was 67,430,173

Silver Exchange Traded Funds: Total as of (10/2/2019) was 715,495,377. That number this week (10/8/2019) was 715,500,555 ounces so we gained 5,178 ounces of silver.

Platinum Exchange Traded Funds: Total as of (10/2/2019) was 3,102,634. That number this week (10/8/2019) was 3,109,929 ounces so we gained 7,295 ounces of platinum.

Palladium Exchange Traded Funds: Total as of (10/2/2019) was 627,587. That number this week (10/8/2019) was 656,327 ounces so we dropped 28,740 ounces of palladium.

We believe our four flat screens downstairs with live independent pricing are unique in the United States. The walk-in cash trade can see in an instant the current prices of all bullion products and a daily graph illustrates the range of the markets on any given day.

Yes – you can visit the store with cash and walk away with your product. Or you can bring product to the store and walk away with cash. We will also wire funds into your account that same day for a small fee ($25.00) if you are in a hurry.

In addition to our freshly ground coffee we offer complimentary cold bottled water, Cokes and Snapple. We also provide fresh fruit in a transparent attempt to disguise our regular junk food habits as we sneak down the block for the best donuts in the world (Randy’s). 

Like us on Facebook and follow us on Twitter @CNI_golddealer – have some fun.

We appreciate your friendship and business. Blessings and thanks for reading.           

Disclaimer – The content in this newsletter and on the GoldDealer.com website is provided for informational purposes only and our employees are not registered financial advisors. The precious metals and rare coin market is random and highly volatile so it may not be suitable for some individuals. We suggest before deciding on a course of action that you talk with an independent financial professional. While due care has been exercised in development and dissemination of our web site, the Almost Famous Gold Newsletter, or other promotional material, there is no guarantee of correctness so this corporation and its employees shall be held harmless in all cases. GoldDealer.com (California Numismatic Investments, Inc.) and its employees do not render legal, tax, or investment advice.

Posted on

Gold Stays in the Fight

Gold Stays in the Fight

Commentary for Wednesday, October 9, 2019 – Gold closed up $8.90 today at $1506.10. Gold, again seems like it is just feeling around for something more substantial and again there is not much buzz in the physical world.

Quiet is a good word here with some suspicion as to why gold keeps fighting hard to hold that psychologically important $1500.00 level. Personally I would feel better if this market simply broke down and redefined a short-term but reliable trading range – most paper traders are most likely thinking something between $1470.00 and $1500.00.

So dramatically higher prices on the short-term is out the window for now as gold has been stuck on either side of $1500.00 for a month as rumors about trade deals, impeachment, lower interest rates and mild Asian physical markets push gold prices higher, lower and back to unchanged. But one thing is sure, this back and forth play has taken away the short term sizzle but the probability of lower interest rates and other international factors keeps everyone’s attention.

The most likely “big mover” one way or the other will be dollar strength relative to the next FOMC interest rate move – likely to be seen on 30th of October. The CME FedWatch Tool suggests there is an 80% chance of lower interest rates (perhaps another ¼ point) which makes sense now that the governors have admitted publically that our economy is slowing. But this is now common information meaning this coming interest rate cut is already baked into the cake. So gold will likely continue to drift unless come December they decide to cut another ¼ point – generally lower interest rates will force the dollar lower and gold bulls will become revitalized.

It’s interesting that the gold bulls even with all this back and forth price indecision have not given up the ghost – even though typical paper traders will be looking for lower prices, simply because after a long term of indecision a breakdown is typical, if anything is typical these days.

I think the reason we have not seen lower prices sooner than later is because there are developing scenarios which are fun to talk about but paper traders are still nervous. They do not want to bet the farm on the “short” trade because the financial and political picture remains blurry.

The big thing physical gold has going for itself is that today’s financial world remains a very large crap shoot which should keep everyone’s attention nicely.

Considering common sense questions like whether poor 2019 physical demand will be replaced with a robust 2020 market (a real possibility) or whether out of control world spending already guarantees much higher prices in the near future just keeps things interesting.      

This from Zaner (Chicago) – “Global equity markets overnight were mostly higher with a couple markets in Asia off slightly. There are rumors this morning that China might be open to a partial deal “despite” the White House actions this week and that has probably served to lift equities and undermine US treasuries. In the end it would appear as if the US political situation is set to become intense while there could be a slight improvement in the exit talks between the UK and Ireland. Overnight economic information was limited with the only major report a Japanese machine-tool orders reading for September which declined by a massive 35.5% versus year ago levels. The North American session will start out with a weekly private survey on mortgage applications, followed by the August job openings and labor turnover (JOLTS) survey which is expected to have a modest downtick from July’s 7.217 million reading. August wholesale trade is forecast to hold steady with its July reading. The latest FOMC meeting minutes will be released during early afternoon US trading hours. Fed Chair Powell will speak during late morning US trading hours while Kansas City Fed President George will speak during the afternoon.

With two of three Fed members yesterday leaning in favor of cutting rates and the Fed Chairman walking a neutral line with suggestions the economic outlook is still favorable, the Fed might be contributing to the slightly higher gold trade this morning. Gold and silver should also be benefitting from a minimal setback in the dollar and ongoing favorable demand news from the ETF sector. In fact gold ETF’s have now seen inflows for 17 days in a row which is apparently the longest streak since the subprime crisis. While some measures already have gold ETF holdings at record high levels (there are differences among what instruments are being included) the trend of investment is very clear. Apparently the World Gold Council continues to trumpet the fact that gold ETF holdings in September reached new all-time highs of 2,808 tonnes after a monthly jump of 75.2 tonnes while Bloomberg measures seem to suggest that ETF’s must expand another 35 tons to reach a new record. According to Citi gold could now rally to $1700 as economic slowing should push money from other markets into gold. In our opinion traders should be prepared for a breakdown in trade talks as harsh commentary from both sides early this week appears to have polluted the air and Chinese negotiators are high enough in the hierarchy to walk out if they view US tactics as insulting. Gold might find support from a 10 day Indian festival that starts today, especially as that will be followed by the Diwali festival of light where interest in buying gold for traditional gift giving should prompt some buyers to look beyond high prices. From the technical perspective, the slide from last week’s high was forged on falling trading volume and a minor contraction in open interest and that could suggest a lack of broad-based interest in the short side. The silver charts this morning look more bullish than the gold charts with the market forging a nine day high and retesting the psychological $18.00 level. It should be noted that silver ETF holdings increased for the third straight day with year to date purchases now at 105.7 million ounces. Support and a pivot point in December silver moves up to a series of closes around $17.70.

The News early this morning that the Chinese might be open to a partial deal “despite” the harsh posturing from the US, is probably providing both platinum and palladium with some lift. Obviously volatility has returned to the palladium market with the 24 hour low to high range of $50 and prices seemingly poised to return to if not above contract highs directly ahead. Not surprisingly palladium ETF holdings gained an inconsequential amount overnight while platinum holdings gained 12,417 ounces to post yet another new all-time high holding level. With the December palladium contract seemingly respecting the $1,600 level on the charts yesterday and an unusual flow into palladium ETF’s at the end of last week, it is possible that futures traders and small investors are finally coming to some agreement of opinion. Uptrend channel support in the December palladium contract today is at $1,643.35 with a lower pivot point support level seen at $1,638.20. Despite its status as a significant laggard in the PGM complex, the platinum market continues to be underpinned by consistent inflows into ETF holdings and chart action this morning forged a modest upside breakout as if prices are poised to claw higher. In fact, platinum ETF holdings reached yet another new all-time high level just below 2.8 million ounces and that is roughly 350,000 ounces above the levels seen in June. Critical support in December platinum is seen at $886.90 and then again down at $881.50.

While the gold and silver markets have looked vulnerable over the prior four trading sessions, the bull camp is hopeful that the talks will breakdown quickly. However, traders should be aware of early rumors this morning from the Chinese side of the table that they might be willing to do a partial deal as that could sink gold and silver while supporting PGM prices. On the other hand the Trump Administration has expressed disdain for a partial deal. Certainly economic data continues to show weakness but we think trade issues are now driving the markets. We see critical support in December gold at $1,501.70 and then again at the very often mentioned $1,492 level. Critical pivot point pricing in the silver is $17.70 and a more important support point/failure level is seen down at $17.54.”

Silver closed up $0.11 at $17.73. Still plenty of buzz and plenty of buying customers.

Platinum closed up $6.60 at $891.90 and palladium closed up $4.00 at $1656.10

We believe our four flat screens downstairs with live independent pricing are unique in the United States. The walk-in cash trade can see in an instant the current prices of all bullion products and a daily graph illustrates the range of the markets on any given day.

Yes – you can visit the store with cash and walk away with your product. Or you can bring product to the store and walk away with cash. We will also wire funds into your account that same day for a small fee ($25.00) if you are in a hurry.

In addition to our freshly ground coffee we offer complimentary cold bottled water, Cokes and Snapple. We also provide fresh fruit in a transparent attempt to disguise our regular junk food habits as we sneak down the block for the best donuts in the world (Randy’s). 

Like us on Facebook and follow us on Twitter @CNI_golddealer – have some fun.

We appreciate your friendship and business. Blessings and thanks for reading.           

Disclaimer – The content in this newsletter and on the GoldDealer.com website is provided for informational purposes only and our employees are not registered financial advisors. The precious metals and rare coin market is random and highly volatile so it may not be suitable for some individuals. We suggest before deciding on a course of action that you talk with an independent financial professional. While due care has been exercised in development and dissemination of our web site, the Almost Famous Gold Newsletter, or other promotional material, there is no guarantee of correctness so this corporation and its employees shall be held harmless in all cases. GoldDealer.com (California Numismatic Investments, Inc.) and its employees do not render legal, tax, or investment advice.

Gold Firms – Expect Volatility Next Week

Gold Firms – Expect Volatility Next Week

Commentary for Friday, October 4, 2019 – Gold closed down a quiet $0.90 today at $1506.20. Considering this market closed down $33.40 at $1465.70 last Monday these most recent numbers going into the weekend point to a contentious fight between the bulls and bears – because the political and economic picture remains in a state of flux.

So for nowthe best you can claim about gold is that price opinions vary widely. This past month it has attempted to reclaim the initiative, moving towards $1550.00 twice and each time the rank and file supporters had $1600.00 in mind.

When gold broke down late September the trading mood changed on a dime – in 5 trading days gold was testing support and approached $1470.00 with many bulls claiming that it would now have to test $1400.00 to get its footing back and establish a new and solid base.

So just when everyone moved from bullish to cautious – the same old concerns revitalized enough safe haven demand to get everyone’s attention.

Factors now pushing gold prices back to $1500.00 are familiar and include the possible Trump impeachment (a diversion in my mind), the worldwide slowdown in manufacturing goods, the surprising weakening in US manufacturing data and the continued Hong Kong violence.

A weakening in worldwide commerce coupled with no inflation also raises the old recession question. European banks are using negative interest rates and should the US slowdown – perhaps reflecting troubling US tariffs now being raised against the European Union it would lead to greater pressure on the FOMC to once again lower interest rates. This would reinvigorate the gold bulls and lay the groundwork for another push to higher ground before year end.

Reuters – “Dallas Fed President Robert Kaplan said Thursday that he’s open-minded about supporting more interest-rate cuts, according to a Reuters report. Kaplan, who is not a voting member of the Fed’s interest-rate committee, said only “time will tell” if more easing is needed. The Fed has cut interest rates twice by a quarter-percentage point in successive meetings. The next interest-rate policy meeting is set for Oct. 29-30. The Dallas Fed president seemed open to another move, saying that he would rather lower rates “when it matters, which I think is doing it sooner rather than later.” If the Fed waits until the weak business investment seeps into other parts of the economy, it would have waited too long, he said, during a community forum hosted by the Houston branch of the regional bank.”

If you are a technical bear even with the latest firmness in gold there is always room for your opinion as the price of gold seems to vacillate. First lower and then higher – in a familiar dance always present when it begins to lose its base. The past 5 years gold has moved between $1100.00 and $1400.00 so the latest push looking at $1600.00 seems out of place.

Of course the bulls argue that we are now facing an extraordinarily dangerous economic and political model – and they might be right. Our President does not mind taking most anyone to task and while this might not be a bad thing for American pride of ownership it is not the best approach if you are trying to project financial and economic calm.

This makes our European partners nervous – especially because no one, even the US seems to have a plan which will pay back the money which has been borrowed or perhaps more importantly leveraged since the financial crisis of 2008.

Neils Christensen (Kitco) notes the goofy disparity between the US and European physical markets. During this latest rise in gold prices sales by the Perth Mint moved dramatically higher while those of the US Mint moved dramatically lower.

And he rightly points out that gold sales in Europe are different than gold sales in the US. Folks outside the US take physical gold and silver ownership more seriously. They have suffered because of unstable government and have learned that the precious metals are indispensable.   

It makes sense that US gold bullion demand has not heated up as gold moved higher. We have seen some renewed interest in gold bullion across our counter but considering the stakes – financially and politically the US bullion market remains distracted. If it were not gold would be trading comfortably above $2000.00 and most likely heading for twice that number.

But US gold bullion interest will likely remain weak as long as the dollar and the DOW remain strong. So for you lagers there is still plenty of time for conversion, profit and protection. 

Of course there are problems which could displace US complacency including this latest Trump impeachment interest but the typical mindless rhetoric which is common in US politics would have to be replaced with facts and figures. They are out there but also generally ignored.   

So while Wall Street and the dollar remain strong gold will likely remain interesting to those ahead of the curve yet left-footed enough to present significant price chop – so I’m sticking with my latest blind guess – look for continued turbulence in the metals and stocks.

Uncertainty will at least underpin metals prices. At the same time watch silver bullion – this area of the market has always been a sleeping giant simply because the math between the physical market and the paper market just does not seem to make sense.         

This from Zaner (Chicago) – “Global markets were unable to hold onto Thursday’s late strength and have taken a negative turn early in today’s trading. The Fed’s Clarida said that a slowing global economy has hit the US economy, and that financial conditions in the US have eased substantially. Hewlett Packard said that up to 9,000 jobs would be cut. Hong Kong’s government invoked emergency powers that included a ban on face masks. Asian shares posted mixed results with the Japanese Nikkei posting a mild gain while the Hong Kong Hang Seng ended up with more than a 1% loss. German construction PMI rose by nearly 4 point and climbed above 50.0, while UK new car registrations posted a modest monthly gain. The Irish Foreign Minister said that the UK government’s new Brexit proposals were “a step forward”. European shares were posting mild early gains and were led to the upside by the UK FTSE-100. The North American session will start with the highlight for global markets, the September US employment situation report. September non-farm payrolls are expected to come in around 140,000 to 150,000 which compares to August’s 130,000 reading. September unemployment is forecast to hold steady at 3.7% while September average hourly earnings are expected to hold steady at a 3.2% year-over-year rate. The August trade balance is forecast to have a modest increase from July’s $54 billion monthly deficit. August Canadian international merchandise trade is expected to have a modest downtick from July’s monthly deficit. The September Canadian Ivey PMI is forecast to have a moderate decline from August’s 60.6 reading. Atlanta Fed President Bostic will speak during morning US trading hours while Fed Chair Powell, Fed Vice Chair Quarles and Fed Governor Brainard will speak during the afternoon.

The gold market showed fleeting strength on Thursday and very mild strength this morning, but it has failed to catch a lasting bid despite lingering global macroeconomic uncertainty and periodic weakness in the dollar. Some bears are holding out hope that today’s US non-farm payroll readings will be resilient enough to tamp down what has become a dramatic escalation in US recession fears. It is also likely that this week’s political events in China have reduced demand in the cash gold market inside China, and it is still unclear if the dollar is set to extend into a full downtrend pattern. From a technical perspective, it should be noted that open interest in gold fell consistently on the end of September washout and prices recovered sharply off the first big negative US data point in a fashion that suggests that the December contract has returned to the September consolidation bound by $1,491 and a quasi-double top up at $1,543.30. Unfortunately for the silver bulls, silver appears to be held back slightly by sagging physical demand fears associated with growing evidence of slowing. It also appears that the December contract has run into resistance from the underside of the September consolidation zone around $17.70. ETFs added 39,919 ounces of gold to their holdings in the last trading session, but they cut 149,385 ounces of silver, according to Bloomberg. India’s gold imports fell to their lowest level in at least three years in September, down 86% from a year earlier.

Excessive volatility in palladium over the last couple of sessions has probably discouraged some buyers, but the market has kept within a fairly tight inside day range coming into this morning’s action. It has shown amazing respect for the longer-term uptrend that began in August, and that should provide support today at $1,619.60. But it has still failed to attract investment flow into ETFs and derivatives despite the historic run, which may lead some to suggest that the market is not totally “bought out” yet. In other words, until small investors pile into the long side of palladium, the market might have further gains ahead. Platinum saw another record ETF holdings tally yesterday and was aggressively oversold with a six day break of nearly $100, but it held a burdensome spec and fund long positioning into the washout. Therefore, we suggest would be buyers avoid purchasing January platinum above $880.

The general bias in precious metals remains to the upside, with the gold market likely to post more gains than silver in the event that this week ends with definitive recession fears. But in order for gold to rocket higher off recession fears, it would probably require confirmation of high anxiety from large panic-style selling in equities. Critical support in December gold is seen at $1,480.50 and then again down at $1,465. Support in December silver seen at $17.24. It could take a close above $18.10.”

Silver closed down $0.05 at $17.54.

Platinum closed down $7.30 at $881.70 and palladium closed up $12.20 at $1643.80.

This is our usual ETF information – Gold Exchange Traded Funds: Total as of (9/25/2019) was 75,275,848. That number this week (10/2/2019) was 77,168,557 ounces so we gained 892,709 ounces of gold.

The all-time record high for all gold ETF’s was 85,108,867 ounces in 2013. The record high for Gold ETF’s in 2019 was 77,168,557 and the record low for 2019 was 67,430,173

Silver Exchange Traded Funds: Total as of (9/25/2019) was 710,955,699. That number this week (10/2/2019) was 715,495,377 ounces so we gained 4,539,678 ounces of silver.

Platinum Exchange Traded Funds: Total as of (9/25/2019) was 3,092,643. That number this week (10/2/2019) was 3,102,634 ounces so we gained 9,991 ounces of platinum.

Palladium Exchange Traded Funds: Total as of (9/25/2019) was 635,913. That number this week (10/2/2019) was 627,587 ounces so we dropped 7,326 ounces of palladium.

Our Patented Employee Survey – Gold’s Direction Next Week?

Of course it’s not really patented but we do have some fun along the way. This is what the GoldDealer.com employees think: 8 believe gold will be higher next week and none think gold will be lower and 1 thinks it will be unchanged.

Our Patented Customer Survey – Gold’s Direction Next Week?

Like the employees our customers were given three choices – up – down – unchanged. We limited the survey to a random sampling of 100 transactions – unscientific but worth considering because these people took action: 54 people thought the price of gold would increase next week 30 believe the price of gold will decrease next week and 16 think prices will remain the same.

Precious Metal Closes & Dollar Strength – Sept 30 – Oct 4

Gold Firms - Expect Volatility Next Week

We believe our four flat screens downstairs with live independent pricing are unique in the United States. The walk-in cash trade can see in an instant the current prices of all bullion products and a daily graph illustrates the range of the markets on any given day.

Yes – you can visit the store with cash and walk away with your product. Or you can bring product to the store and walk away with cash. We will also wire funds into your account that same day for a small fee ($25.00) if you are in a hurry.

In addition to our freshly ground coffee we offer complimentary cold bottled water, Cokes and Snapple. We also provide fresh fruit in a transparent attempt to disguise our regular junk food habits as we sneak down the block for the best donuts in the world (Randy’s). 

Like us on Facebook and follow us on Twitter @CNI_golddealer – have some fun.

We appreciate your friendship and business. Blessings and thanks for reading.           

Disclaimer – The content in this newsletter and on the GoldDealer.com website is provided for informational purposes only and our employees are not registered financial advisors. The precious metals and rare coin market is random and highly volatile so it may not be suitable for some individuals. We suggest before deciding on a course of action that you talk with an independent financial professional. While due care has been exercised in development and dissemination of our web site, the Almost Famous Gold Newsletter, or other promotional material, there is no guarantee of correctness so this corporation and its employees shall be held harmless in all cases. GoldDealer.com (California Numismatic Investments, Inc.) and its employees do not render legal, tax, or investment advice.

Posted on

Gold Continues to Consolidate?

Gold Continues to Consolidate?

Commentary for Friday, September 27, 2019 – Gold closed down $8.80 today at $1499.10. This past Monday gold closed at $1523.70 so on the week we have moved lower by $24.60 – not the end of the world – over the past year gold has moved up by more than $300.00 but with the world in probably one of the biggest transition periods I have seen in my career I had hoped for more fireworks – or if not that at least more bargain hunting after Wednesday’s drop of $27.50.

With the pricing pattern we are looking at going into this weekend we will have to settle for a kind of mediocre picture as gold fights to regain the initiative. It opened flat in overnight trading, sold off to $1486.00 and spent the rest of the trading day firming up – once again looking at $1500.00. I think this is not a particularly bullish statement but it does show that few traders want to be short-over the weekend.

And if you are of the optimistic persuasion you can claim that gold’s pricing action is not bad considering the dollar is trading at two year highs.

Crude oil seems steady at $55.00 which suggests traders don’t take the latest news out of the Middle East seriously. This is a mistake – there is plenty of trouble brewing over there – more serious than we have seen in years and I can’t figure out why everyone is still complacent.

Still there are plenty of reasons why gold should be creating more buzz. The EU is embracing negative interest rates, the FOMC will lower rates again before year end, the German economy is in trouble and this food fight between China and Trump is not going to go away regardless of how hard each side tries to put lipstick on this pig. Chinese trade has been hurt and maybe more importantly they will not be taken to task, at least publically by Trump.

Technically I still like gold, you can’t really argue with success – a market which has pushed from $1420.00 through $1540.00 this past two months offers great promise. But gold traders and even the safe-haven buying public have short-memories.

This market has struggled to make new highs since early August – failed, tested support and consolidated around $1500.00 – all that without much Asian demand and against a strong dollar.

In the process, I don’t think gold has hurt itself technically but it has given up most of the positive buzz which led folks to talk about $1600.00 before year end. Not that these uber-bulls have given up – they have not – but the dollar has now become a powerful obstacle.

So the standoff between the bulls and bears continues. From a local viewpoint we have actually seen little selling of gold bullion which should not be surprising. The gold bulls are not even close to throwing in the towel and the silver bulls are gathering more steam.

This from Zaner (Chicago) – “Global equity markets were mixed overnight with markets in Tokyo Moscow and Hong Kong lower and the rest the world posting minimal gains. Overnight economic news included inflation readings from Tokyo which were softer than expected while German import price readings also showed signs of deflation. In France producer prices and consumer spending for August were both unchanged on a month over month basis. On a positive note, Spanish retail sales for August jumped 3.2% on year ago levels. Data from Italy showed softer consumer and business confidence readings and a noted drop in producer prices. Overall Euro zone services sentiment and consumer confidence were better than expected but consumer, industrial and business climate readings were all in negative territory. The North American session will start out with August personal income which is forecast to have a modest uptick from July’s 0.1% reading. August personal spending is estimated to have a modest downtick from July’s 0.6% reading. August durable goods are forecast to have a moderate decline from July’s 2.1% reading. A private survey of September consumer sentiment is expected to hold steady with a previous 92.0 reading. Fed vice Chair Quarles and Philadelphia Fed President Harker will speak during morning US trading hours.

Gold and silver start the last trading session of the week under some technical pressure and the bull camp that has to be discouraged with the lack of upside sensitivity off the impeachment situation. However the gold market is faced with yet another higher high for the move in the dollar this morning which has put the currency index at a new 2019 high. Apparently the gold market is also uninterested in news that Chinese gold imports from Switzerland and Singapore in August jumped significantly and that failure to react is even more surprising considering news earlier in the week that Chinese imports from Hong Kong in August jumped by more than 60% on a month over month basis. Another underpin for gold and silver that is being discounted this morning is the fact that ETF’s continue to see inflows with gold ETF’s posting the ninth straight day of inflows. So far this year gold ETF’s have added almost 10 million ounces and have reached the highest holdings level in 12 months. The market overnight saw another prediction of record gold ETF holdings, this time with the prediction targeting a new record within the next six weeks. Silver ETF’s also added to their holdings bringing this year’s net purchases to 98.6 million ounces. While stories overnight suggested the potential for improved Indian Festival buying ahead a combination of high gold prices and a weak Indian currency has discourage some Indian buyers in recent months and therefore it could take a further correction in gold prices to foster noted seasonal buying from an important demand source. However the Diwali festival is the primary Indian demand window and some analysts have suggested slack imports last month suggests there is pent-up demand from India waiting in the wings. Unfortunately gold looks set to post a negative weekly trade as the market is showing a lack of sensitivity to the threat against the US President and gold looks to remain under modest pressured as a result of the latest “hope” for progress on a trade deal. In the end, ongoing inflows to ETF instruments, signs of strong Chinese gold demand and the prospect for improved Indian seasonal buying ahead should make a return below $1,500 a buying opportunity.

While the palladium market did not forge a definitive upside extension with the recovery effort yesterday, it is apparent that the market remains in vogue and should continue to carve out gains in new high territory ahead. In fact suggestions from a key global palladium production leader, targeting an extension of the bull market because of a lack of investment, would seem to give the bull case sustainable fundamental credibility. Uptrend channel support in December palladium is $1,618.20, with initial/thin resistance at $1,648 and the next upside targeting seen at $1,654.90. While the platinum market continues to see record ETF holdings posted on a regular basis, the futures trade has not rendered the platinum market as attractive as the palladium market. The latest reading on platinum ETF holdings was 2.782 million ounces which means holdings have risen by 770,000 ounces this year! It should be noted that recent trading volume in platinum has also increased, open interest has shown fresh strength and the market saw that same action prior to the late August rally. On the other hand, October platinum futures must hold above $923.70 to avoid another definitive chart failure.

Apparently the safe haven storyline of impeachment isn’t fully offsetting lingering hope for trade progress and more new 2019 highs in the Dollar Index and that should keep gold and silver off balance today. In other words the potential for impeachment of the US President would not appear to be a major uncertainty yet and that uncertainty has not caused noted volatility in US equity markets nor has that situation resulted in noted safe haven flow into other flight to quality markets like Treasuries and the Yen. In the near term, we can’t rule out a temporary probe’s below $1,500 in December gold but given the prospect of improved Indian buying next month and given the trend of the geopolitical environment we see declines below $1,495.00 should be con a place to accumulate longs.”

Silver closed down $0.26 at $17.55.

Platinum closed down $5.10 at $931.00 and palladium closed up $10.00 at $1654.30.

Our Patented Employee Survey – Gold’s Direction Next Week?

Of course it’s not really patented but we do have some fun along the way. This is what the GoldDealer.com employees think: 7 believe gold will be higher next week and 1 thinks gold will be lower and 2 think it will be unchanged.

Our Patented Customer Survey – Gold’s Direction Next Week?

Like the employees our customers were given three choices – up – down – unchanged. We limited the survey to a random sampling of 100 transactions – unscientific but worth considering because these people took action: 55 people thought the price of gold would increase next week 27 believe the price of gold will decrease next week and 18 think prices will remain the same.

Precious Metal Closes & Dollar Strength – Sept 23 – Sept 27

We believe our four flat screens downstairs with live independent pricing are unique in the United States. The walk-in cash trade can see in an instant the current prices of all bullion products and a daily graph illustrates the range of the markets on any given day.

Yes – you can visit the store with cash and walk away with your product. Or you can bring product to the store and walk away with cash. We will also wire funds into your account that same day for a small fee ($25.00) if you are in a hurry.

In addition to our freshly ground coffee we offer complimentary cold bottled water, Cokes and Snapple. We also provide fresh fruit in a transparent attempt to disguise our regular junk food habits as we sneak down the block for the best donuts in the world (Randy’s).

Like us on Facebook and follow us on Twitter @CNI_golddealer – have some fun.

We appreciate your friendship and business. Blessings and thanks for reading.

Disclaimer – The content in this newsletter and on the GoldDealer.com website is provided for informational purposes only and our employees are not registered financial advisors. The precious metals and rare coin market is random and highly volatile so it may not be suitable for some individuals. We suggest before deciding on a course of action that you talk with an independent financial professional. While due care has been exercised in development and dissemination of our web site, the Almost Famous Gold Newsletter, or other promotional material, there is no guarantee of correctness so this corporation and its employees shall be held harmless in all cases. GoldDealer.com (California Numismatic Investments, Inc.) and its employees do not render legal, tax, or investment advice.

Posted on

Gold Weakens over a Strong Dollar

Gold Weakens over a Strong Dollar

Commentary for Wednesday, September 25, 2019 – Gold closed down $27.50 at $1504.60 and was virtually unchanged in the aftermarket so traders aren’t exactly falling over each other buying the dip. Still we are in early days and it’s difficult to say whether this settling is just gold finding its feet after the drop or may test stronger hands on the short term.  It was steady in the overnight Hong Kong and London market but broke to the downside in domestic trade supposedly over the release of a Trump phone call which in turn prompted new talk of impeachment. I think this explanation does not make sense. Gold has been bouncing around between $1500.00 and $1540.00 for almost two months now with still no China trade deal (although Trump was upbeat this morning).

And gold yawned over the attack by Iran on the Saudis which should have been troubling. Yet the price of crude oil remained steady between $50 and $60 which is surprising and should have suggested something might not be right in River City. If this happened a few years ago crude would be up $50 and safe haven gold buying would be fully engaged.

Now look at the dollar – the Dollar Index is 99.00 – very strong and consider that 3 months ago the index was happy around 96.00 – that my friends is one of gold’s real problems – safe haven is happening with the dollar not gold.

The second issue is sagging demand in China and India – actually these numbers have been weak for months. Which is not surprising, both countries are super price conscious. And my guess is that both think that the price of gold is too high and are willing to wait for better prices.  

So what about gold’s technical picture?

It still favors the bulls but has always been somewhat tenuous these past 2 months. In July gold was trading around $1400.00 and during the same time frame created enough buzz to muster two attempts to push above $1540.00 – both failed so with today’s loss of $27.50 traders are not pondering higher numbers. They are wondering if gold has becoming defensive – in other words will it hold $1500.00?

This is exactly the “chop” in prices I talked about in the last missive – this “price settlement” should be expected and could get more turbulent. And all will depend on whether the bulls cut and run or bargain hunting shows up between now and Friday.

In the longer term however the world has embraced dovish central bank policy – the US is however a little late to this party but they will eventually be forced to play ball. Any other options at this point would create panic and support higher gold prices.     

This from Zaner (Chicago) – “Global markets have been unable to shake off a negative tone coming into this morning’s action following Tuesday’s events. China’s Beige Book said that their country’s economy has been the weakest it has been all year during the third quarter. China’s Foreign Minister said that US/Chinese relations are at “a crossroads”. Asian shares were generally lower, and were led to the downside by losses in the Shanghai Composite and Hong Kong Hang Seng indices. The European data calendar was light, but there have been better than expected results for readings on French consumer confidence and the Swiss ZEW survey. European shares were under early pressure as the UK FTSE-100, German DAX and French CAC-40 were all more than 1% lower. The North American session will start out with a weekly private survey of mortgage applications, followed by August new home sales that are expected to show a modest uptick from July’s 635,000 annualized rate. Chicago Fed President Evans and Kansas City Fed President George will speak during morning US trading hours while Dallas Fed President Kaplan will speak during the late afternoon.

A round of risk off, safe haven news seemed to reach a peak on Tuesday, with House Speaker Pelosi announcing a formal impeachment inquiry and President Trump’s speech at the UN raising further concerns about the fate of a possible trade deal between the US and China. Gold closed higher Tuesday for the third session in a row and continued its steady march higher since putting in a low on September 18th, but one would have thought that the gold bulls would have reacted more strongly to the swirl of bad economic data, uncertain trade prospects and political uncertainty. Silver consolidated in the upper end of Monday’s breakout higher. Overnight, the dollar recovered its losses from yesterday, and gold set back slightly. In his speech to the UN, Trump excoriated China over their trade practices, and this seemed to discourage hopes for a trade agreement. Earlier in the day, the release of the September US Consumer Confidence reading came in worse than expected with the biggest decline in nine months, and this added to recession fears. The dollar fell steadily throughout the day, which was also supportive to gold and silver. Exchange-traded funds added 7,851 ounces of gold to their holdings in the last trading session, bringing the total to 80.2 million. As a percent of holdings, the purchase was negligible, but it marked the seventh straight day gold holdings have increased, and it brought net purchases for the year to 9.13 million ounces. Holdings are at a six-year high. In the wake of all of the safe haven worries, some are calling for gold to reach the $1600 level. The trend of higher highs and higher lows stretched to four sessions on Tuesday, so the short term bull trend is intact. ETFs sold 1.15 million ounces of silver, bringing their holdings to 620 million. The silver sale represented 0.2% of holdings.

Platinum was higher Tuesday on the elevated risk concerns associated with trade, impeachment talk, and concerns over the economy, but once again it failed to move out on top of a three-week consolidation pattern between $923.70 and $966.80. If gold and silver continue to gain off the safe haven themes, we would expect platinum to follow along. December palladium traded to new all-time high for the third session in a row, as the safe haven fears did little to dispel investor interest in this market. Uptrend channel support moves up to $1,603.30 today, with $1,652.20 as a near term target.

The market’s rather blase reaction to the announcement of the impeachment inquiry could be concerning to the bulls today, as a raft of bullish factors have been thrown at the market. Among the other bullish themes are trade concerns in the wake of President Trump’s UN speech, which was barely mentioned in the news after the impeachment discussion. If the trade news worsens, we would expect safe haven buying to resume. Support in December gold is seen at $1,524.70 and $1,503.70 with resistance at $1,560.40. Near term upside targeting in December silver is seen at $19.23 with support at $18.346.”

Silver closed down $0.56 at $17.96.

Platinum closed down $27.50 at $926.30 and palladium closed down $34.60 at $1613.60. 

This is our usual ETF information – Gold Exchange Traded Funds: Total as of (9/18/2019) was 75,252,428. That number this week (9/25/2019) was 76,275,848 ounces so we gained 1,023,420 ounces of gold.

The all-time record high for all gold ETF’s was 85,108,867 ounces in 2013. The record high for Gold ETF’s in 2019 was 76,275,848 and the record low for 2019 was 67,430,173

Silver Exchange Traded Funds: Total as of (9/18/2019) was 708,885,722. That number this week (9/25/2019) was 710,955,699 ounces so we gained 2,069,977 ounces of silver.

Platinum Exchange Traded Funds: Total as of (9/18/2019) was 3,084,566. That number this week (9/25/2019) was 3,092,643 ounces so we gained 8,077 ounces of platinum.

Palladium Exchange Traded Funds: Total as of (9/18/2019) was 635,406. That number this week (9/25/2019) was 634,913 ounces so we dropped 493 ounces of palladium.

We believe our four flat screens downstairs with live independent pricing are unique in the United States. The walk-in cash trade can see in an instant the current prices of all bullion products and a daily graph illustrates the range of the markets on any given day.

Yes – you can visit the store with cash and walk away with your product. Or you can bring product to the store and walk away with cash. We will also wire funds into your account that same day for a small fee ($25.00) if you are in a hurry.

In addition to our freshly ground coffee we offer complimentary cold bottled water, Cokes and Snapple. We also provide fresh fruit in a transparent attempt to disguise our regular junk food habits as we sneak down the block for the best donuts in the world (Randy’s). 

Like us on Facebook and follow us on Twitter @CNI_golddealer – have some fun.

We appreciate your friendship and business. Blessings and thanks for reading.           

Disclaimer – The content in this newsletter and on the GoldDealer.com website is provided for informational purposes only and our employees are not registered financial advisors. The precious metals and rare coin market is random and highly volatile so it may not be suitable for some individuals. We suggest before deciding on a course of action that you talk with an independent financial professional. While due care has been exercised in development and dissemination of our web site, the Almost Famous Gold Newsletter, or other promotional material, there is no guarantee of correctness so this corporation and its employees shall be held harmless in all cases. GoldDealer.com (California Numismatic Investments, Inc.) and its employees do not render legal, tax, or investment advice.

Posted on

Gold Closes Firm into the

Gold Closes Firm into the Weekend

Commentary for Friday, September 20, 2019 – Gold closed up $8.90 going into the weekend at $1507.30. It was steady in the overnight Hong Kong and London markets holding a few dollars in range just above $1500.00 and the domestic trade opened a bit weaker but recovered managing to finish on the day nicely in the green. And while gold still holds the technical advantage being up almost $300.00 this past year the bulls have lost short-term momentum this past month. Over the last 30 days gold pushed nicely up to the $1550.00 overhead resistance and then lost its own conviction. In a few days of profit taking gold was no longer looking at a possible $1600.00 challenge and folks began to wonder if this failed expectation was going to turn into the end of the party.

Now that is not to say the bears have moved into the forest – they have not – no one wants to short this market with big problems in the Middle East and a still unresolved US/China trade dispute. Add to this not yet boiling pot the notion that the European central banks are embracing negative interest rates and the latest FOMC ¼ rate cut will most likely be followed by another rate reduction in early December. Surprisingly all of this has not led to a weaker dollar – the Dollar Index this past week has been rather flat around 98.00, yet gold remains firm.

So what does all this mean? It is true that last year’s $300.00 profit climb has spoiled to some degree gold’s solid base support. This, in my mind will pass and folks realize that in fact we are just going through an extended consolidation period which should be welcomed and adds credibility to this intact and stable bull leg. I would however modify the short term price expectation – look for increased chop and volatility between now and the end of the year.

Yet I remain bullish on gold and silver in the longer term because the basics which created these bullish legs are still in place. At the same time a change in FOMC sentiment has added to the confusion. They reclaim a mildly hawkish position based on the reality that the US economy is doing fine but they can raise higher interest rates because of recession fears – real or imagined.

So in a typical fashion the Fed is trying to serve two masters and is facing an upcoming presidential election in the bargain. Trying to rearrange the deck chairs at this point makes no sense – my belief is that lower interest rates – perhaps dramatically lower are the new reality. And this over time must support higher gold prices – political angst – economic warfare or Middle East blow-up will only support this theory over time.     

This from Zaner (Chicago) – “Global equity markets overnight were mixed with no geographical pattern among winners and losers. Commodity markets might garner some support today from a second reduction this month in the Chinese new loan rate as China continues to step up and support their economy. Commodities should also see some benefit from corporate tax rate reductions in India. Overnight European officials indicated there might be a chance for a deal on the UK exit but the markets were not easily convinced of that potential. From the economic report front overnight Japanese CPI readings came in somewhat soft in August on a year-over-year basis with core rates of inflation slightly higher. From Germany producer prices for the month of August came in slightly softer than expected on year-over-year and month over month comparisons. The North American session will feature a July reading on Canadian retail sales that is expected to have a moderate uptick from June’s unchanged reading. New York Fed President Williams and Boston Fed President Rosengren will speak during morning US trading hours while Dallas Fed President Kaplan will speak during the afternoon.

While the gold and silver markets definitively favored the downside yesterday, prices in the end continued to respect what should be considered solid consolidation low support levels. Both gold and silver look to enter the last trading session of the week within two week old sideways consolidation patterns but breakout moves might be difficult to orchestrate this morning given a thin US economic report slate. However gold should draft support from a second Chinese new loan rate reduction this month, initial weakness in the dollar and ongoing anxiety from the Middle East situation. In addition to the US VP reiterating Iran as the likely source of the recent drone attacks and labeling the aggression an “act of war” the Middle East situation should remain in the headlines as a key element of the bull case. It should also be noted that Saudi Arabia has launched attacks on military targets in Yemen overnight which isn’t all that surprising considering that some factions inside that country claimed responsibility for last weekend’s terrorism. Another potentially supportive element for the gold market was seen in India where the government chopped corporate taxes and provided a $20.5 billion tax break to stimulate private investment and growth. Indian equities soared creating favorable conditions for the retail purchase of gold in the wake of that 5% reduction in the corporate tax rate. Gold should be supported as a result of a 4th straight day of ETF purchases while silver should be undermined slightly as a result of a 1.4 million ounces liquidation of ETF holdings overnight particularly because that was the 3rd straight day of outflows. From a technical perspective, the pattern of lower highs and declining volume in gold since the early September high could suggest traders initially balked at prices above $1,525, but we could also point out a slight hook up in open interest on the recent 9 day consolidation pattern as a sign of accumulation buying and the ongoing existence of a bull market.

While it has been difficult to ascertain the real driving force behind the August and September record uptrend drive in palladium prices, the strong recovery/upside extension yesterday following improved global economic sentiment, suggests the market is indeed benefiting from classic demand hopes. In fact, a reinterpretation of the net take away from the US Federal Reserve decision seems to have come down in favor of the doves and that certainly adds to the bullish luster of palladium. Furthermore with the palladium market forging another new all-time record high early today, the market should garner fresh front page headline coverage and that should facilitate follow-through investment buying. As we have indicated a number of times over the last month the palladium market probably retains additional buying capacity with the net spec and fund long in the last positioning report still sitting well below half of the record spec long positioning forged all the way back in April of 2013. It should be noted that current palladium prices are more than double the price levels seen back in April 2013 when the record spec long was registered. Yesterday platinum ETF’s boosted holdings by 70,771 ounces which amounted to a daily gain in holdings of 2.2%! Unfortunately palladium holdings increased by an inconsequential 46 ounces despite the new all-time record high price print yesterday. Uptrend channel support in December palladium today is seen at $1,599.25 with a critical pivot point seen today at $1,622.80. While the platinum market did not benefit as much as palladium from the slight improvement in overall market psychology yesterday, prices and have forged an early a four day high early today in a fashion that suggests prices will claw higher.

While gold and silver prices have basically remained within extending consolidation patterns the initial bias is pointing up today due to stimulus efforts in China and India, initial weakness in the dollar and also because Middle East tensions following Saudi attacks on Yemen military targets. Traders should use a breakout system in December gold today with a rally above $1518.50 a buy signal while a decline below $1492.10 would be seen as a sell signal. Pushed into the markets we think the bull camp retains an edge and we wouldn’t be surprised to see a late afternoon rally as traders interject some weekend premium into prices. In silver the charts are a little more bearish than gold charts but the ability to rise above $18.07 could signal a restart of the bull trend that was in place from July through early September. Some traders are pointing out the declining volume and open interest readings in silver in the face of the September correction as a sign that participants were not overly interested in pressing prices this month.”

Silver closed down $0.03 at $17.74. Still plenty of action – mostly buyers.  

Platinum closed up $0.30 at $941.80 and palladium closed up $12.40 at $1626.80.

Our Patented Employee Survey – Gold’s Direction Next Week?

Of course it’s not really patented but we do have some fun along the way. This is what the GoldDealer.com employees think: 8 believe gold will be higher next week and no one thinks gold will be lower and 2 think it will be unchanged.

Our Patented Customer Survey – Gold’s Direction Next Week?

Like the employees our customers were given three choices – up – down – unchanged. We limited the survey to a random sampling of 100 transactions – unscientific but worth considering because these people took action: 46 people thought the price of gold would increase next week 31 believe the price of gold will decrease next week and 23 think prices will remain the same.

Precious Metal Closes & Dollar Strength – Sept 16 – Sept 20

Gold Closes Firm into the

This is our usual ETF information – Gold Exchange Traded Funds: Total as of (9/11/2019) was 75,428,671. That number this week (9/18/2019) was 75,252,428 ounces so we dropped 176,243 ounces of gold.

The all-time record high for all gold ETF’s was 85,108,867 ounces in 2013. The record high for Gold ETF’s in 2019 was 75,634,480 and the record low for 2019 was 67,430,173

Silver Exchange Traded Funds: Total as of (9/11/2019) was 714,143,225. That number this week (9/18/2019) was 708,885,722 ounces so we dropped 5,257,503 ounces of silver.

Platinum Exchange Traded Funds: Total as of (9/11/2019) was 3,011,594. That number this week (9/18/2019) was 3,084,566 ounces so we gained 72,972 ounces of platinum.

Palladium Exchange Traded Funds: Total as of (9/11/2019) was 631,888. That number this week (9/18/2019) was 635,406 ounces so we gained 3,518 ounces of palladium.

We believe our four flat screens downstairs with live independent pricing are unique in the United States. The walk-in cash trade can see in an instant the current prices of all bullion products and a daily graph illustrates the range of the markets on any given day.

Yes – you can visit the store with cash and walk away with your product. Or you can bring product to the store and walk away with cash. We will also wire funds into your account that same day for a small fee ($25.00) if you are in a hurry.

In addition to our freshly ground coffee we offer complimentary cold bottled water, Cokes and Snapple. We also provide fresh fruit in a transparent attempt to disguise our regular junk food habits as we sneak down the block for the best donuts in the world (Randy’s). 

Like us on Facebook and follow us on Twitter @CNI_golddealer – have some fun.

We appreciate your friendship and business. Blessings and thanks for reading.           

Disclaimer – The content in this newsletter and on the GoldDealer.com website is provided for informational purposes only and our employees are not registered financial advisors. The precious metals and rare coin market is random and highly volatile so it may not be suitable for some individuals. We suggest before deciding on a course of action that you talk with an independent financial professional. While due care has been exercised in development and dissemination of our web site, the Almost Famous Gold Newsletter, or other promotional material, there is no guarantee of correctness so this corporation and its employees shall be held harmless in all cases. GoldDealer.com (California Numismatic Investments, Inc.) and its employees do not render legal, tax, or investment advice.

Posted on

Gold Choppy into FOMC News

Gold Choppy into FOMC News

Commentary for Tuesday, September 17, 2019 – Gold closed up $2.00 at $1505.10 in typical trading fashion – the overnight Hong Kong and London markets being steady to somewhat weaker and the domestic market buying the dip moving higher ($1507.00) and then selling off to almost unchanged.

If you look at gold’s 6 month chart a few things are worth noting. As usual some are positive and some are negative. First, gold from March through June seemed happy around $1300.00 yet by the summer months higher prices were in the offing. Gold was waking up – supported by safe haven demand. Prices moved steadily higher and gold developed the best buzz I have seen in the physical market in years. We moved from $1300.00 through $1400.00 and saw some consolidation but world angst continued and central banks bought so prices continued to push higher – eventually reaching $1550.00 in August.

At that point the China/Trump fiasco cooled but there was still buzz and the physical trade expected this latest higher leg to eventually push through $1600.00. So with a positive technical picture and the Europeans embracing negative interest rates most expected this week’s FOMC meeting (September 17th and 18th) to produce a significant cut in interest rates.

And then, really out of nowhere the talk of this big rate cut turned from an almost “certainty” into a question mark. Perhaps the fear of recession has ebbed and the FOMC deep thinkers have once again changed their minds. Of course this is not unusual – the Fed has changed its mind dozens of times and really – most of the time that’s all they have to do – just talking is usually sufficient to gain their advantage. Still most expect a ¼ point cut by tomorrow with a “wait and see” approach so no one can deny the FOMC is more hawkish now than it was a few months back and this, in my opinion has cooled the gold market expectation.

So gold’s price action today is a crap shoot – the FOMC will release information after the market close on Wednesday. The price of crude oil seems to be creating some fear in stocks – this past month prices have moved up nearly seven dollars. And the Dollar Index today has lost a half point – both of these factors help support gold but are not fresh news.

But gold has lost some momentum – I will leave it up to you to decide whether this market is just resting or is tired and needs a period of consolidation – backing and filling between $1400.00 and $1500.00 – which actually would not be a bad thing – this would take away some of the unreasonable expectation that gold will move higher without exception, get rid of weak hands and allow reasonable base building for the next leg upward. 

The higher pricing from $1300.00 through $1550.00 presented the technical folks with a treasured rising bottom’s picture – that is always exciting. But the fall in prices from $1550.00 to below $1500.00 crossed over that rising line and has perhaps created a technical problem. Now add to this uncertainty an increasingly hawkish FOMC and you can see that traders want to wait and see what the latest FOMC tea leaves have to say. Our store action across the counter reflects this uncertainty in gold, less so in silver and there is still bargain hunting in platinum bullion.

Finally a look at current physical premiums presents interesting insight. Premiums on gold bullion coins never really went crazy during the big rise in prices and so have not fallen much as activity slowed. The same is true for silver bars – nothing cheap out there but there is some softness in 90% bags. This might suggest while gold prices may consolidate the current rally in silver prices still has some legs.   

This from Zaner (Chicago) – “In retrospect, we see the lack of a sustained rally in gold in the face of significant uncertainty and in the face of one of the largest single day rallies ever in crude oil, as signs of an overbought market. While it is possible that gold will draft support from the anticipation of a 25 basis point rate cut from the US Fed tomorrow we would suggest that expectation is already largely factored into the price of gold. The bear camp will rightly suggest that the Saudi Arabian attack failed to dominate gold and silver prices for long perhaps because the situation has yet to result in a reaction by Saudi Arabia and or the US. In fact the US President has indicated he does not want war with anyone but suggested the US is more prepared for war than anyone else. However some support for gold prices might be derived from news that the Iranian leader has rejected one-on-one talks with the US and from suggestions from Saudi officials that the drones were made of Iranian military equipment. Another issue that might be prompting some minor long liquidation this morning is the fact that Chinese negotiators have apparently left China for talks in the US. Certainly the oil price rise helped to lift gold and silver prices yesterday but talk of huge US and Saudi strategic reserves has squelched a portion of safe haven interest from the attacks. Reuters’ total gold ETF readings for Monday showed a 25,173 ounce build in gold holdings, with silver ETF holdings yesterday showing a decline of 2.8 million ounces. Apparently the gold market overnight has discounted news from the IMF that Turkey and Qatar central banks increase their gold reserves in August with Qatar raising its holdings to a new record level. While the gold market has not paid that much attention to the ongoing violent protests in Hong Kong, there are reports of investors moving gold holdings out of Hong Kong to safer locations and that could incorrectly send-off signals of softening Chinese demand for gold ahead. However in the end yet another safe haven story line for gold and silver has been added from the attacks to ongoing investor inflows, ongoing central bank gold buying and from the prospect for US easing later this week. As indicated in our Monday coverage, Citibank thinks gold could be headed to the $2,000 level because of the prospect of a number of US rate cuts later this year and the potential for negative rates in the US and that clearly increases the importance of the Fed meeting tomorrow. In other words, the bull camp once again has a very strong list of bullish forces in place. In fact, we see the current condition in gold similar to the condition in early June where gold prices exploded for $200 on the upside with silver gaining in excess of $4.00! From a technical perspective, we would suggest that gold and silver have somewhat corrected the significantly overbought conditions seen at the beginning of the month, but both markets have obviously burned both futures and cash buying fuel with their summer rallies. For today gold and silver appear to have fairly close consolidation low support on the charts, but we feel technical signals will take a backseat to fundamental headlines in the coming trading sessions.

Despite positive leadership from gold and silver yesterday, platinum and palladium prices on Monday disappointed the bull camp with poor chart action. Furthermore it appears as if the PGM markets early today have remained off balance with the charts leaning in favor of the bear camp to start. Clearly the PGM markets this week are set to track classic physical commodity market demand type forces instead of safe haven issues like gold, Bonds and the Yen. Critical support and a pivot point in October platinum is seen today at $929.50 with critical uptrend channel support in December palladium today seen at $1583.30. Some analysts suggest palladium might be poised to benefit from geopolitical issues in the event the West (particularly the US) to strikes Iran as we suspect Russia will stand up for Iran against the US and that could potentially leave Russian PGM exports in question if there is the hint of sanctions against Russia. However the prospect of Russia supply obstruction because of Iran is big “reach”. In fact the most likely force lifting palladium prices over the last week was probably the fresh hope of further US/China trade progress.

While the gold market seems to have found interim support at the psychological level of $1500 and silver appears to have found some value around the $18.00 level, we think the action so far this week is disappointing for the bull camp. In fact from a technical perspective one could suggest both gold and silver remain in bearish short-term chart patterns from the early September highs, even though the fundamental case decidedly favors the bull camp. However we think it will take straightaway and definitive escalation of tensions in the Middle East to vault gold higher, as equities are not throwing off uncertainty and economic sentiment looks to be cushioned over the coming 24 hours from the prospect of a US rate cut Wednesday afternoon. Reports that Chinese trade negotiators are leaving for talks in the US is also serving to sooth anxiety in the marketplace. Uptrend channel support in December silver today is seen at $17.573 and initial resistance is seen at $18.26 and then again up at $18.33. Uptrend channel support in December gold today is seen at $1498.50 and initial resistance is seen at $1523.80.”

Silver closed up $0.12 at $18.02.

Platinum closed up $5.00 at $943.30 and palladium closed up $3.90 at $1595.40. 

We believe our four flat screens downstairs with live independent pricing are unique in the United States. The walk-in cash trade can see in an instant the current prices of all bullion products and a daily graph illustrates the range of the markets on any given day.

Yes – you can visit the store with cash and walk away with your product. Or you can bring product to the store and walk away with cash. We will also wire funds into your account that same day for a small fee ($25.00) if you are in a hurry.

In addition to our freshly ground coffee we offer complimentary cold bottled water, Cokes and Snapple. We also provide fresh fruit in a transparent attempt to disguise our regular junk food habits as we sneak down the block for the best donuts in the world (Randy’s). 

Like us on Facebook and follow us on Twitter @CNI_golddealer – have some fun.

We appreciate your friendship and business. Blessings and thanks for reading.           

Disclaimer – The content in this newsletter and on the GoldDealer.com website is provided for informational purposes only and our employees are not registered financial advisors. The precious metals and rare coin market is random and highly volatile so it may not be suitable for some individuals. We suggest before deciding on a course of action that you talk with an independent financial professional. While due care has been exercised in development and dissemination of our web site, the Almost Famous Gold Newsletter, or other promotional material, there is no guarantee of correctness so this corporation and its employees shall be held harmless in all cases. GoldDealer.com (California Numismatic Investments, Inc.) and its employees do not render legal, tax, or investment advice.

Posted on

Gold Continues to Consolidate

Gold Continues to Consolidate

Commentary for Wednesday, September 11, 2019 – Gold closed up $4.10 at $1494.40 in quiet trading. If you look at the 30 day pricing chart it is pretty clear the bulls are looking at headwinds. In early August the gold market was choppy – pushing the envelope between $1500.00 and $1520.00 but was developing buzz which always encourages the long trade. By mid-August we were pushing towards $1550.00 with talk about how $1600.00 would be tested before the end of the year.

Then the China/Trump trade battle lost altitude – both sides were now suggesting that something might be worked out but this would take time. Many thought this was the primary reason gold moved lower ($1550.00 through $1490.00) and suddenly became defensive.

But it is easy to underestimate the ongoing China problem. Their currency tanked, perhaps by design, the result of what China sees as intractable differences with Trump. And there are rumors that their GDP numbers are overstated. The point being that we may be looking at large macro changes internationally which are still under the radar and have consequences.  

Yesterday we saw across our counter a large wave of selling – suggesting that the pubic was nervous and decided to take some money off the table. Things quieted down and then surprisingly the afternoon crowd moved in and bought gold and silver with both hands suggesting this market is not as weak as the short-term technical picture might seem.

Today this mild optimism is still in place. The overnight Hong Kong and London gold market turned weak – testing $1487.00 yet before the domestic and Globex trade closed gold had pushed back to highs on the day of $1497.00. And this push back happened as the Dollar Index got stronger and stocks firmed – both of which should have held gold prices in check. 

Still the bulls have some worries technically – looking at the 60 day gold pricing chart will show that we have pushed dramatically higher since early July but with the big momentum dissipating a round of profit taking may be in the offing.

So is gold tired or resting? It’s most recent dip below $1500.00 was modest but it could be a wakeup call and perhaps suggest that further consolidation is in the cards – if $1500.00 really breaks down the next supporting floor looks like $1420.00.

But most believe based on central bank accumulation and world angst that bargain hunting will show up sooner than later. In the meantime any flair up in the basically unresolved problems which cause these higher prices will simply reinstate the still sound longer term technical picture. 

Keep in mind there are technical guys who believe that gold has been in a primary bull market since 2015. Up and down yes but generally higher prices since we dipped below $1100.00 some 5 years ago. And the contributing factors which have pushed gold higher are still in place with a few new wrinkles. World central banks have readopted a loose money policy – gone is the rhetoric which was in place for years about raising interest rates as economies recovered. This is a huge development which was snuck in the back door as talk of recession reappeared.

So what do I think? Like usual the middle ground looks good to me – buy this market (gold or silver) on weakness. Make owning gold or silver a reasonable part of your long term financial plan – do it quietly and hope that the folks looking for world bankruptcy or Armageddon are wrong. I never have been big on the “melt-down” theory but since the 1970’s it has come and gone a number of times. Each time it has reinvented itself the potential consequence of world money mismanagement has grown worse. Let’s hope no country has to look back on these cycles and say they should have seen this coming.             

This from Zaner (Chicago) – “Global markets have regained a mildly positive risk tone coming into today’s actions. China announced a list of US goods that were exempt from additional import tariffs. Chinese auto sales fell by 6.9% during August which was a fourteenth straight month with a year-over-year decline. Asian shares were mostly higher and were led to the upside by the Japanese Nikkei and Hong Kong Hang Seng indices, although the Shanghai Composite posted a moderate loss. German 30-yields have climbed back into positive territory early today, and a group of Scottish judges have ruled that UK Prime Minister Johnson’s decision to suspend the UK Parliament was illegal. European shares are posting moderate gains and were led by strength in the UK FTSE-100 and German DAX indices. The North American session will start out with a weekly reading on mortgage applications. The August producer price index is expected to hold steady with July’s 1.7% year-over-year rate. The August core producer price index (excluding food and energy) is forecast to have a minimal uptick from July’s 2.1% year-over-year rate. July wholesale trade is expected to hold steady with June’s reading.

Gold and silver were choppy overnight, trading both sides of unchanged, as the markets were looking ahead to the ECB meeting on Thursday. China has announced it will suspend certain tariffs on US imports for year, including some agricultural products like insecticides and feed, as well as drugs. There were reports that the exemptions were meant to reduce the trade impact on American companies in China and also to deal with some of their internal agricultural problems like swine fever and fall armyworm. While could be viewed as an accommodation ahead of the US/China trade talks, but the fact that the suspensions did not include soybeans or pork suggests that the motivations were internally focused and not necessarily an appeasement to the US demands. Spec positions in gold and silver are heavily long, which leaves the market vulnerable to liquidation as support levels are taken out, but with the trade anticipating that the ECB will cut rates, the market has found some support. Such a move by the ECB could increase the pressure on the Fed to cut rates as well. We look for more back and forth action as we get into the ECB and FOMC meetings later this week and into next.

Platinum was moderately higher overnight, as the market seemed to find some support ahead to the ECB meeting. News that two South African mining companies were ready to bring in mediators to resolve a standoff with the mining union did little to support the platinum market on Tuesday and may have had a hand in pressuring it. South Africa’s main platinum mining union had previously stated that it had formally declared that wage talks with Anglo American Platinum and Sibanye-Stillwater were deadlocked, raising the possibility of strike action if the issue cannot be resolved, so the talk of a mediator could be a bearish development if it leads to progress. Like gold and silver, specs are heavily long platinum, which leaves the market vulnerable to long liquidation. And like those markets, platinum has been seeing the safe-haven premium drained from prices since last week. We may see the market stabilize and chop back and forth as the ECB and Fed meetings come and go. China’s tariff suspensions indicate they are paying close attention to the effects on their business environment, and that can lend support to palladium on the idea that this will help lift automobile sales. News overnight that Chinese auto sales were behind year-ago levels for the fourteenth straight month could negative for palladium today. Look for support in October platinum at $929.50, with resistance at $1,000.80. Look for support in December palladium at $1,514.30 and $1,500, with resistance at $1,564 and $1,595.90.

We could see gold and silver chop around a bit as we approach the ECB meeting on Thursday and the FOMC meeting next Tuesday and Wednesday. The trade is looking for rate cuts. The markets are vulnerable to heavy selling if support levels are taken out, particularly if trade talks are successful, but long term fundamentals would seem to favor the bulls. December gold support comes in at $1,488.90 and $1,477.35 with resistance at $1,511.10 and $1,526.5. Support for December silver comes in at $17.554.with resistance at $18.40 and $18.57.”

Silver closed down $0.01 at $18.03. Still plenty of buyers here – looking for higher prices.  

Platinum closed up $3.60 at $938.80 and palladium also closed up $3.60 at $1556.60. 

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