Gold & Silver Digest: 6/14/13

Adam Taggart
By Adam Taggart on Sat, Jun 15, 2013 - 11:45am

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.

6/14/13 7:22 PM EST US close metals price quotes from Finviz

CNBC: Gold Ends Up at $1,387, Posts Weekly Gain

Gold settled higher at $1,387 an ounce on Friday, driven by resilient demand for coins and bars and a pullback in the U.S. equities market lifted gold on the day and for the week.

Traders said rising geopolitical tensions in the Middle East also boosted the metal's safe-haven appeal. Western diplomats said the U.S. is considering setting up a no-fly zone in Syria, which would represent its first intervention in that civil war, after the White House said Syria had crossed a "red line'' by using nerve gas.

Zero Hedge: Stunning Images From China: Ten Thousand People Waiting In Line To Buy Gold

Sometimes one must see to believe, in this case believe just how massive the raw demand for the shiny, barbarous relic is in China during times of relative monetary stability (in this case the Dragon Boat Festival). Now assume runaway inflation as we saw in 2011 China, which may be unleashed by something as catalytic as the PBOC once again deciding to inject liquidity in its suffocating banking system and to revive growth in the stalling economy.

GoldSilver.com: COMEX Options Interest in Super High Gold Prices by end-August

Behind the scenes we have noticed the very excited state of interest in gold at the COMEX, despite JP Morgan's vault being almost empty of deliverable gold.

One can see for themselves with the CME Group's Open Interest tool, below is a screenshot of August, the next delivery month, with orange representing those who are betting price will fall (puts) and green, for those who are betting price will be higher (calls) by the end of August.

Forbes: Is It Sustainable To Mine Gold In This Current Price Environment?

After seeing gold prices plummet in 2013 and with gold miners battling high operating costs, gold companies find themselves with razor thin profit margins with the ounces they’re pulling out of the ground.

The cost to mine and produce an ounce of gold, on average, ranges from $1,100 to $1,250.. Some mines produce gold at a very affordable cost while others are now producing gold at costs that are higher than the metal is valued.

As gold rose to over $1,900 an ounce in the fall of 2011, the general thought process that accompanied the rise was that gold miners were reaping enormous profit margins.

Bloomberg: Gold Bears Return as ETP Rout Extends to 17th Week: Commodities

Gold traders turned bearish for the first time in a month as investors reduced holdings in exchange-traded products for an unprecedented 17th consecutive week and India, the biggest buyer, announced curbs on imports.

Eighteen analysts surveyed by Bloomberg expect prices to fall next week, with 14 bullish and four neutral, the largest proportion of bears since May 17. Investors sold 497.2 metric tons valued at about $22 billion through ETPs since Feb. 8 and the 2,117.96 tons left is the least they have held since March 2011, data compiled by Bloomberg show.

CNBC: Why I'm Selling Gold Today: Pro

Gold remains confused under $1,400. Is it a currency or safe haven? Whatever your philosophical view of the yellow metal, you have to use the technicals to trade it.

Gold retreated in early Friday trading after rallying into Thursday's electronic close, when it tested the $1,388 pivot level on the upside.

MarketWatch: New up phase for gold?

While the sub-discipline of price and time cycles within the larger study of technical analysis just might be way too far afield for many market watchers, I am nevertheless fascinated by periodicity exhibited by indexes, commodities, FX, Treasurys, etc. I have come to appreciate that any subtle market idiosyncrasies should not be ignored but instead monitored along with other more traditional technical studies and indicators.

My big-picture cycle work for spot gold is represented by a five-and-a-half- to six-month low-to-low trading-day periodicity. This cycle has been reasonably accurate going back to 2001, which means that every five-and-a-half to six months since the gold bull market began, the price structure has established a tradable, if not very significant, low.

GoldSilver.com: The Long Silver Ranger

Could China be the big silver long? Who else has deep enough pockets to endure the recent price weakness and the increased margin requirements that typically follow? 

Nevertheless, the Chinese willingness to accept fungible dollars instead of precious metal seems to be waning. They are quietly accumulating metals..

King World News: Greyerz - Silver Is Coiling For Major Upside Explosion In Price

On the heels of the IMF warning the U.S. about the danger of ending QE prematurely, today Egon von Greyerz told King World News that silver is now ready for a major upside explosion in price.  Greyerz also discussed the possibility of a collapse in China as well as what is happening with gold and inflation.  Below is what Greyerz, who is founder of Matterhorn Asset Management out of Switzerland, had to say in this exclusive interview.

Greyerz:  “In the short-term, Eric, European interbank loans are collapsing which means the system is under great strain.  And the major part of the Fed’s money is going to foreign banks.

Note: If you're reading this and are not yet a member of Peak Prosperity's Gold & Silver Group, please consider joining it now. It's where our active community of precious metals enthusiasts have focused discussions on the developments most likely to impact gold & silver. Simply go here and click the "Join Today" button.

Login or Register to post comments