Gold & Silver Digest: 3/1/13

Adam Taggart
By Adam Taggart on Fri, Mar 1, 2013 - 7:02pm

The Gold & Silver Digest contains headlines of stories that members of this group deem relevant and/or interesting to precious metals enthusiasts.

If you have articles to submit for the next digest, please email them to me by clicking here.

3/1/13 6:42 PM EST US close metals price quotes from Finviz

Reuters: Gold down on strong US data, ignores spending cuts

Gold fell on Friday, posting its third straight weekly decline, as its reputation as a safe haven failed to attract buyers after strong U.S. economic data and global markets remained relatively calm ahead of wide-ranging U.S. government spending cuts.

Bullion dropped as the dollar rose after U.S. economic data including consumer spending, consumer confidence and factory activity all pointed to a pickup in economic growth. Some investors believe a better U.S. outlook could prompt the Federal Reserve to halt its stimulus earlier than expected.

The Telegraph: Gold price suffers longest run of monthly falls in 16 years

The price of gold fell for the fifth month in a row in February, meaning that the precious metal has completed the longest run of monthly declines since 1996.

Spot gold fell to $1,579 per ounce yesterday, having plunged through the $1,600 an ounce last week – the first time it had breached this level since August.

Gold lost 5pc of its value in February, as improving global economic outlooks lessened demand for the safe haven. Experts blamed a more buoyant stock market, and the growing confidence of both private and institutional investors, many of whom are turning their back on "safe" assets and seeking the higher returns associated with share and high-yield bonds.

MarketWatch: Gold ETP flows set for weakest month on record: Barclays

Gold futures weren’t the only investment asset to take a hit in February. Gold exchange-traded product flows were set to log their weakest month on record, according to Barclays.

Shares of the SPDR Gold Trust exchange-traded fund GLD +0.03% were trading at $152.33 Friday, down 0.4%, as gold futures  GCJ3 -0.15% fell $5.80, or 0.4%, to settle at $1,572.30 an ounce, a more than seven-month low, as strength in the dollar and U.S. equities drew investors away from the precious metal. The ETF and gold futures each lost about 5% for the month of February.

Forbes: Uncertain Outlook For Gold Next Week

A volatile gold market is leaving market participants wary on gold’s direction next week after sharp rallies and breaks were seen in this week’s action.

Gold had a wide trading range this week, roughly between $1,554 and $1,620, and prices settled at the lower end of this range.

April gold futures ended weaker on Friday, settling at $1,572.30 an ounce on the Comex division of the New York Mercantile Exchange. This was down 50 cents, or 0.03%, on the week. Most-active May silver ended higher on the day, settling at $28.49. This was down 3 cents, or 0.105% on the week.

MarketWatch: Gold’s bull run not over, it’s just taking a break

After all, the factors that contributed to gold’s fifth straight monthly decline — central-bank monetary-policy cues, economic data, currency fluctuations, asset relocation, and emerging markets — are generally the same as they’ve been for gold’s more-than-decade-long bull run.

“Many are declaring that there is no catalyst to drive gold forward,” said Jan Skoyles, head of research at The Real Asset Co., a precious-metals investment platform provider. “They’re right — the bullish drivers of gold haven’t changed at all for several years.”

Resources Wire: Shelter From The Storm

Kevin Michael Grace spoke with Bob Moriarty, founder and President of 321Gold.com, February 25.

RW: You called a bottom on February 21.

BM: Yes.

RW: We’ve been bombarded with negative sentiment regarding gold. Where is it coming from?

BM: It actually feeds on itself. Have you read Nate Silver’s The Signal and the Noise?

321Gold: Bullish Gold Supply

It's hard to believe that gold's bull market is nearly a dozen years old. And boy has it been a delight watching it mature from its 2001 infancy. It's also been fun observing the ever-changing dynamics of gold's structural fundamentals, particularly how the supply side of this metal's delicate economic balance has responded to fast-growing demand.

Until recently gold had three sources of supply, mining, recycling, and central-bank sales. However as a result of the world's governments collectively realizing the folly of their ways, CB sales have recently dried up. And provocatively not only have the CBs stopped selling their gold, they've flip-flopped to become major net buyers of the metal.

King World News: Jim Sinclair - We Are Witnessing A Historic Low In Gold

Today legendary trader Jim Sinclair spoke with King World News about the gold and silver smash.  Below is what Sinclair, who has been actively trading the markets for over half a century and whose father was business partners with legendary trader Jesse Livermore, had to say about what has taken place in the gold market.   

Jim Sinclair:  “Historically we are at an extreme low.  But more so than that, when you are short you have a price objective.  If you are a government you have a price objective.  That price objective being reached might change the pattern of your trading.

SilverSeek: Hope is Fear Gone Bad for Paper Silver Shorts

The price pattern in silver and gold remains intact. It shows that each time these precious metals are pushed below a key technical moving average, new buyers come into the market.

Most are weak hands, speculators or amateur traders who have fallen in love with the idea of a futures contract, although the original longs have still refused to trade their valuable metal for intrinsically worthless paper dollars.

Furthermore, Open Interest on the Comex silver futures contract rose again on Friday, which is astounding. This demonstrates that while the professional traders switched to the short side in gold, the silver longs have not yet capitulated. They are taking the shorts head-on.

SilverSeek: Could the Confirmation of the Breakdown in Silver be Consequential?

Investors sentiment for precious metals and gold and silver mining stocks has deteriorated quite substantially recently. And silver is no exception here, which can be seen on the white metal charts. However, the situation in the whole sector is extreme – the oversold readings on many technical indicators and the fact that very important support lines are currently in play in virtually any asset in the sector form a setup as (or even more) encouraging for potential buyers as what we saw in 2008. To see what we can expect on the silver market, let us move into today’s technical part – we will start with the white metal’s very long-term chart (charts courtesy by http://stockcharts.com.)

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