Gold & Silver Digest: 3/15/13

Adam Taggart
By Adam Taggart on Sat, Mar 16, 2013 - 9:12am

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.

3/16/13 9:43 AM EST US close metals price quotes from Finviz

Reuters: Gold rises to 2nd weekly gain, action light before Fed meeting

Gold finished higher on Friday, marking its second straight weekly gain, as the euro firmed, U.S. and European shares fell and the U.S. consumer price report supported the view that the Federal Reserve has leeway to keep up its monetary easing.

U.S. consumer price data recorded the largest increase in nearly four years in February, as the cost of gasoline surged. Excluding food and energy, however, the gain was only 0.2 percent, slower than January's 0.3 percent pace.

Bloomberg: Gold Rises on Inflation Concerns, Physical Metal Demand

Gold futures rose, capping the biggest weekly gain in two months, as demand improves for the metal as an inflation hedge, including by retail buyers of coins, bars and jewelry.

The U.S. consumer-price index rose more than projected in February after gasoline surged, a government report showed today. Physical demand remains robust, mainly from the Far East, Afshin Nabavi, a senior vice president at MKS (Switzerland) SA, a metal refiner in Geneva, said in a telephone interview. Gold is down 5 percent this year.

Jesse's Café Américain: Gold Daily and Silver Weekly Charts - Shoving Paper Around the Plate

The hedge funds are on top of these precious metal markets and do not wish to let them up for air.

Gold is in one of those long consolidations we have seen in this bull market.  When it is ready to move again it is going to break out.

And it may take no prisoners from the bear camp when it does.

Forbes: Gold Survey: Survey Participants See Higher Gold Prices Next Week

Higher prices for gold are expected next week, according to a majority of participants in the Kitco News Gold Survey, breaking a string of weeks where there was no dominant viewpoint regarding the direction for the gold price.

In the Kitco News Gold Survey, out of 33 participants, 25 responded this week. Of those 25 participants, 17 see prices up, while two see prices down, and six see prices moving sideways or are neutral. Market participants include bullion dealers, investment banks, futures traders, money managers and technical-chart analysts.

Gold Seek: Gold and Silver Manipulation At London AM Fix Or New York COMEX?

Gold continues to trade just below resistance at the $1,600/oz level but appears to be consolidating at these levels after the recent price falls. Investment sentiment towards gold is the worst we have seen it since the start of the secular bull market in the early 2000’s.

This is bullish from a contrarian perspective as the "froth" and less informed, speculative buyers have been washed out of the market as happens in the course of all bull markets as they climb a “wall of worry.”

The Daily Gold: Spring Rally Directly Ahead for Gold Stocks

Last week in regards to Gold we wrote:

We have the majority of sentiment indicators showing more pessimism than in 2008, an explosion in negative news coverage and news that major banks have downgraded their outlooks. Without knowing anything else, you’d expect Gold to be down considerably, yet it’s only off about 5% year to date and 10% in the past three and a half months. Most important, Gold hasn’t even broken support!

Gold has failed to break below its 2011 and 2012 lows and that is a telling sign, especially in the face of this pervasive bearish sentiment. Gold looks likely to close at a four week high and we expect it to challenge $1600 in the coming days. A close above $1620 would essentially confirm that the bottom is in.

SilverSeek: COT Silver Report - March 15, 2013

Futures and Options Combined

What does this title mean?A future is a standardized contract traded through regulated exchanges where an investor buys or sells a contract at a specified price for a specific date in the future.The price includes the interest charge due to the seller by the buyer from the date of the contract to the due date.An option is the ‘right to buy or sell’ a contract at a fixed date in the future at a specific [strike] price.The difference is that a futures contract is an agreement to buy or sell, whereas an option gives the holder the right to buy or sell.An option holder can decide not to take up that right and will only lose the cost of buying the option.His loss is therefore definable at the start of his investment, while the potential profit has not limit to it.A futures contract is usually leveraged [a loan provided] up to 90% of the contract.However, with the owner liable to top up his ‘margin’ to maintain this 10% his potential losses can rise far higher than his investment.A ‘long’ [buying] contract limits its loss to the full price of the item, whereas the ‘short’ [selling] contract has no limit except the height that the price of the item can rise to.

SilverSeek: Silver Possession Versus Silver Trust – A Safe Alternative to Direct Possession?

Value seeking investors are increasingly returning to the precious metals market. Furthermore, many of them will undoubtedly gravitate toward using the more conveniently traded alternatives to self-storing the metals.

The idea of taking physical possession of gold or silver currently seems almost taboo in the mind of the mainstream precious metals investor, although many alternative minded investors tend to see personal physical possession as the only safe option in the event of a financial collapse scenario.

With that noted, the various widely-traded precious metals funds have taken on the burdensome task of owning and storing physical metal for their investors.

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