Gold & Silver Digest: 2/22/13
The Gold & Silver Digest contains headlines of stories that members of this group deem relevant and/or interesting to precious metals enthusiasts.
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2/22/13 8:54 PM EST US close metals price quotes from Finviz
SINGAPORE, Feb 22 (Reuters) - Gold firmed on Friday, extending gains from the previous session, as lacklustre U.S. data bolstered hopes the Federal Reserve's monetary stimulus would stay in place, though prices are heading for a second straight weekly drop.
Thursday's data on employment, manufacturing and consumer prices pointed to a still tepid recovery in the U.S. economy and supported the argument for the Fed to keep its stimulus.
They have vaults from Switzerland to Hong Kong to Dubai, and they count among their clients some of the largest mining companies in the world. They know what they’re doing.
And now they’re dumping US citizens.
Legendary investor Warren Buffett advises to be fearful when others are greedy, and be greedy when others are fearful. One way we can try to measure the level of fear in a given stock is through a technical analysis indicator called the Relative Strength Index, or RSI, which measures momentum on a scale of zero to 100. A stock is considered to be oversold if the RSI reading falls below 30.
In trading on Friday, shares of ElDorado Gold Corp (Toronto: ELD) entered into oversold territory, hitting an RSI reading of 29.7, after changing hands as low as $9.89 per share. By comparison, the current RSI reading of the S&P/TSX Composite Index is 51.3. A bullish investor could look at ELD’s 29.7 RSI reading today as a sign that the recent heavy selling is in the process of exhausting itself, and begin to look for entry point opportunities on the buy side.
Gold saw a $10.31 gain at $1587.21 in Asia before it fell back to $1569.88 at about 9:30AM EST, but it then rallied back higher in the last few hours of trade and ended with a gain of 0.23%. Silver slipped to as low as $28.345 before it also rallied back higher and ended with a gain of 0.28%.
Euro gold climbed back above €1198, platinum lost $4.50 to $1608.50, and copper dropped a couple of cents to about $3.54.
Gold and silver equities saw slight gains in the first half hour of trade, but they then fell back off midmorning and ended with modest losses on the day.
Comex Option Expiration next week. I will be watching the action after expiration to try and get a better sense of where we are in this cycle of market monkey business.
The COT shows that as of Tuesday the hedge funds had deepened their short position in gold quite a bit in the combined futures/options categary, in preparation for a takedown. Next week's report should give us some idea of how things went into the expiration.
When forecasting the future price of silver from a fundamental perspective, it can make sense to review the basic principles of economics and behavioral science as they apply to the silver market.
These principles typically relate to factors that are driving higher future purchasing power of silver or factors that are making silver more valuable as a wealth saving asset. Other key contributing factors to silver’s currently undervalue pricing tend to block awareness with respect to the true value of silver.
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