Gold & Silver Digest: 2/8/13
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.
2/8/13 6:08 PM EST US close metals price quotes from Finviz
Gold edged up to $1673.53 in Asia before it fell back to as low as $1665.14 in early New York trade, but it then bounced back higher at times and ended with a loss of just 0.19%. Silver slipped to $31.314 in early New York trade, but it then rose to as high as $31.68 at about 10:40AM EST and ended unchanged on the day.
Euro gold remained at about €1248, platinum lost $3.30 to $1712.50, and copper climbed a few cents to about $3.76.
Gold and silver equities traded mostly slightly lower and ended with modest losses.
Venezuela devalued its currency for the fifth time in nine years as ailing President Hugo Chavez seeks to narrow a widening fiscal gap and reduce a shortage of dollars in the economy.
The government will weaken the exchange rate by 32 percent to 6.3 bolivars per dollar, Finance Minister Jorge Giordani told reporters today in Caracas. Companies with operations in Venezuela, including Colgate-Palmolive Co., Avon Products Inc. and MercadoLibre Inc., fell on the announcement.
Putting Everyone to Sleep
Something interesting is happening in gold lately – namely, the action in it has become totally uninteresting. Daily trading ranges are becoming ever smaller, as the price is pinched between the declining 50 day moving average and the flat 200 day moving average. In the process, another small triangle has been built, so to speak a triangle within the triangle. Below is a weekly chart that shows the big 18 month long triangular consolidation with the most important lateral support and resistance levels drawn in, followed by a daily chart that shows the smaller triangle.
There is no economic recovery, and there are no signs that a recovery is coming, says Shadowstats.com author John Williams. In this Gold Report interview, he blames mal-adjusted inflation statistics for creating an alternate reality that overestimates economic activity in a way that is unsustainable. Williams warns that eventually the painful truth will be so difficult that even government manipulation won't be able to deny it and that is when hyperinflation will take its toll on those who have not taken his advice for preserving purchasing power and securing wealth.
It seems that the gold repatriation request from Germany gave ideas to many investors, countries and sovereign or investment funds. Case in point, if we analyse the delivery requests on the COMEX for the month of February, we see that they are reaching the astronomical amount of 43,26 tons of physical gold, or 1,391,000 ounces of gold to deliver.
Why is this information paramount ?
As explained by Harvey Organ:
Because, for comparison purposes, delivery requests for the month of December 2012, normally a record month for deliveries, amounted to only 10 tons of gold.
Randy Smallwood, CEO of Silver Wheaton, comments on where both precious metals could move next, with CNBC's Jackie DeAngelis and the Futures Now Traders.
The local silver coin dealer may prove to be the ultimate silver price indicator.
The lower the managed paper price of silver, the more physical metal is reduced due to increased demand. Furthermore, the higher the demand for silver, the higher the physical premium moves.
This is typically the case in true price discovery, but who really wins in this unprecedented dichotomy— the buyer, the seller, or the dealer?
Platinum declined, trimming a weekly advance, on speculation that a climb to the highest price in more than 16 months will prompt some investors to sell. Gold was little changed.
Platinum for immediate delivery dropped as much as 0.7 percent to $1,706.75 an ounce and was at $1,710.80 at 3:02 p.m. in Singapore, up 1.6 percent this week. Prices reached the highest since September 2011 yesterday before dropping 1 percent. Spot gold was at $1,672.30 an ounce from $1,671.65 yesterday, up 0.3 percent this week.
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.