Gold Continues Steady

Gold Continues Steady

Commentary for Thursday, Dec 4, 2014 (www.golddealer.com) – Gold closed down $1.00 at $1207.50 after some theater from Mario Draghi. Traders were listening carefully to what ECB President Mario Draghi had to say about Europe – the European Union – the euro and finally their collective plans to make sure deflation did not further dampen the promise of European economic recovery.

Some traders initially thought he would roll out some kind of bond buying program which would be the basis of continued quantitative easing but as oil moved steadily lower Draghi’s options began to improve – well perhaps improve is not the right word relative to Europe but lower oil was encouraging.

So today’s press conference and early news release caused a spike in the price of gold – this however was premature as Draghi claimed he and the EU would like to further ponder quantitative easing in 2015. This took away any immediacy on the trading floor and gold gave back any relative gains to settle somewhat lower on the day.

Gold was steady however and managed to close above $1200.00 for the second day in a row even though US sales announced today showed strength in this sector. For the first eleven months of this year car sales are up 5.4% and truck sales up 9.6% which bodes well for both platinum and palladium – up smartly today.

So here’s the drum roll – as we approach the end of 2014 will gold close higher on the year? The secret number we have to beat is $1201.90. Well I guess it’s not secret and there are more than a few traders who will take the “under” here but the question deserves pondering.

Not just because there is not much difference between the two numbers – but because gold has had the kitchen sink thrown at it relative to bad news. And the talk that we may be putting in a short-term bottom around $1200.00 persists – granted around the edges at least for now.

Of course this is only talk but that’s how the real trading market works. Traders and the physical world develop a theory relative to price action – and the longer the theory works the more people join the group as believers.

This from Allen Sykora (Kitco) – Walsh’s Lusk: ‘Near-Term Bottom May Be Forming’ In Gold – Buying has emerged on gold pullbacks over the last month, says Sean Lusk, director of commercial hedging with Walsh Trading. February gold dipped as far as $1,132 on Nov. 7 and $1,141.70 on Monday but has recovered above $1,200 both times. “Gold has shown some resilience the last few weeks as dips below the $1,150 area have seen strong buying and follow-through to the upside,” Lusk says. “With Japan, China, and the eurozone re-engaging in more stimulus measures, it looks on the charts that a near-term bottom may be forming despite the weakness in energy.”

Chicago Mercantile Exchange reports for the last 3 trading days – so we are looking at the trading volume numbers for the February Gold contract: Monday 12/01 (238,915) – Tuesday 12/02 (236,278) and Wednesday 12/03 (232,811). All of these numbers are on the high volume side – indicating a great deal of activity.

Silver closed up $0.17 at $16.52 and the following graph will also help the “short-trade” relative to the price of silver.

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Platinum closed up $18.00 at $1245.00 and palladium closed up $5.00 at $801.00.

This from Allen Sykora (Kitco) – Barclays Looks For Another Platinum Supply Deficit In 2015 – Barclays looks for the platinum market to remain in a deficit in 2015. The bank notes that the inaugural report from the World Platinum Investment Council shows platinum swung to a surplus of 155,000 ounces in the third quarter as prices fell by 13%. This was due to recovering mine supply as South African producers ramped up after a five-month strike, softening auto demand and a decline in investment demand. The report notes the third quarter tends to be the seasonally weakest, Barclays says. Still, the WPIC report estimates a deficit for the full year of 885,000 ounces. “Above-ground stocks have capped platinum prices, but, in our view, despite the recovery in supply, demand in China remains price elastic and the underlying trends across the auto sector supportive,” Barclays says. “As a result, we expect the platinum market to deliver another deficit in 2015.”

The walk-in cash trade was very quiet today and so were the phones.

The GoldDealer.com Unscientific Activity Scale is a “2” for Thursday. The CNI Activity Scale takes into consideration volume and the hedge book: (Friday – closed) (Monday – 6) (Tuesday – 6) (Wednesday 3). The scale (1 through 10) is a reliable way to understand our volume numbers. The Activity Scale is weighted and is not necessarily real time – meaning we could be busy and see a low number – or be slow and see a high number. This is true because of the way our computer runs what we call the “book”. Our “activity” is better understood from a wider point of view. If the numbers are generally increasing – it would indicate things are busier – decreasing numbers over a longer period would indicate volume is moving lower.  

You should now be getting email confirmations which include a PDF File when buying or selling so you can confirm your invoice or purchase order. This information also includes the various forms of payment and bank wire instructions. So when you buy or sell please check to see if we have your current email and that your computer will accept our email (no spam).

About shipping information – when buying or selling your rep will walk you through your current mailing information. Thanks for keeping us up to date if you have moved.

Our four flat screens downstairs with live independent pricing (BullionDesk.com) are a big hit with the cash trade. Live pricing moves all the buy/sell product prices on a real time basis. Yes – you can visit the store with cash and walk away with your product. Or you can bring product to the store and walk away with cash. When buying from us remember if you exceed $10,000 in cash (the real green kind) a Federal Form is necessary.

In addition to our freshly ground organic coffee offered visitors throughout the day we have added cold bottled water, cokes and Snapple. We have also added fresh fruit in a transparent attempt to disguise our regular junk food habits.

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Our holiday schedule this year – Christmas (Closed Thursday the 25th and Friday the 26th) – New Year’s (Closed Jan 1st and 2nd).

A gentle reminder – each year during this holiday season the packages delivered to all 50 states slow down because Santa has control of the air traffic.

We appreciate your business – thanks for reading and enjoy your evening.

Disclaimer – The content in this newsletter and on the GoldDealer.com website is provided for informational purposes only and our employees are not registered financial advisers. The precious metals and rare coin market is random and highly volatile so it may not be suitable for some individuals. We suggest before deciding on a course of action that you talk with an independent financial professional. While due care has been exercised in development and dissemination of our web site, the Almost Famous Gold Newsletter, or other promotional material, there is no guarantee of correctness so this corporation and its employees shall be held harmless in all cases. GoldDealer.com (California Numismatic Investments, Inc.) and its employees do not render legal, tax, or investment advice.

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