Commentary for Wednesday, Feb 26, 2014 – Gold closed down $14.80 today at $1328.20. For 12 of the past 14 days gold moved steadily higher and today we saw a round of profit taking. Helping the slide was a stronger dollar but it is significant that gold is still trading above its 200 day moving average of $1305.00 so I would not get out the aspirin just yet even though UBS is predicting even lower prices. The Australian Gold Kangaroo 1 oz was a great seller today.
Jim Wyckoff (Kitco) makes an interesting point that gold may also have seen some selling pressure because the European Union is moving to loan Ukraine funds so that the country might avert financial collapse. The perpetual lending to countries in danger of default is a hidden mechanism which supports gold in the longer term. Today’s world of mega-finance may seem untouchable but the fear of a domino type collapse keeps stoking the fires of unsafe lending practices. The dollars necessary today are unbelievable and in many cases the lender in this the case the EU will never see the payback. This unending increase in debt should be feared by investors who believes “all is right” in world politics. And the worst part of this mess is that lenders may have few options.
Silver closed down $0.71 at $21.25 after a recent push to higher ground which saw an almost 15% increase in prices so profit taking was also in the cards. The Austrian Silver Philharmonic 1 oz and the American Silver Eagle 1 oz sold well today.
Platinum followed gold down $13.00 at $1428.00 and palladium was off $5.00 at $731.00. The miners strike in South Africa continues but no one seems to care even though the loss of manufactured product could approach 230,000 ounces of platinum.
Profit taking by paper traders is good for the gold business because it keeps everyone on the same page and focused. Like I have been saying for sometime expect overhead resistance to set the stage and consider recent rallies a bonus. The technical picture for gold looks better short term but open up the frame and consider pricing back to the summer of last year. During this one year period gold bottomed twice ($1200.00) and has been struggling ever since to regain the important $1400.00 mark. This latest attempt ran into the same resistance so until gold can assert itself above $1400.00 consider today’s price action range bound between $1200.00 and $1400.00. A break above $1400.00 would be big for gold and mean we could then challenge the fundamental breakdown in pricing seen in 2012 when gold failed to maintain strength at the $1800.00 level. Of course by the time this happens investors looking for a lock bet will have left $300.00 on the table. So my usual step approach makes sense as long as upward momentum maintains itself and if the market goes flat to lower just step aside and wait until outside metrics support higher gold prices. The great thing about physical ownership is that it allows for a great deal of flexibility and options all over the place.
The walk-in cash trade was active today but not hurried and we are seeing an increase in new customers. Also keep in mind the weather in LA is getting nasty by California standards which will slow business into the weekend. The phones were also just average.
The GoldDealer.com Activity Scale is a “3” for Wednesday. The CNI Activity Scale takes into consideration volume and the hedge book: (last Thursday – 5) (last Friday – 5) (last Monday – 5) (last Tuesday – 4) (Wenesday – 3). Our scale (1 through 10) is a reliable way to understand volume numbers.
On the new GoldDealer.com site: Comex closing prices are posted on the home page and individual product landing pages. Live pricing on the site moves all bullion products up or down during the day. The change number included next to the live pricing uses yesterday’s Comex closing prices as a reference. So if the change number is green and shows up $3.00 this is in reference to yesterday’s close. You now don’t have to visit several sites to find the Comex close relative to live trading numbers which are independently verified.
We reworked the All Bullion Products link on the home page. It now includes our Bid (blue) and Ask (green) prices. When you hover over it with your cursor the text is highlighted.
Premium quotes vary with product and look like this – “spot plus $15.00” or “spot plus $50.00” and bullion products list them under the live prices on their respective landing pages. This makes product comparison easy and GoldDealer.com is the only precious metal site on the net with this transparency. For example click on the link American Gold Eagle and under Our Live Buy Price and Our Live Sell Price you will see: our Buy Premium Spot + $15.00 and our Sell Premium Spot + $50.00 – Easy.
Live Chat is doing well and new customers like setting up their own encrypted accounts. Improvements will continue through the 1st quarter of 2014. Let us know what you want. We recommend upgrading old browsers to Google Chrome (free/secure) especially as our site becomes more advanced.
Sign up for our daily Gold Newsletter on the Gold Newsletter page if you are so inclined and remember this is now live for you too so why not sound off? Reader insight is interesting and varied.
Email confirmation when you are buying or selling is functional. A PDF file will be added which will create a picture invoice identical to the store invoice. This invoice will include information like wiring instructions.
The four flat screens downstairs with live independent pricing (BullionDesk.com) is a big hit with the cash trade. This live stream moves all the buy/sell prices on each product so the cash buying public can see the markets move on a real time basis. Our site uses the same pricing model so no more guessing.
Our best price guarantee (buying or selling) remains famous so call Kenny at 1-800-225-7531. And for more than 30 years we have guaranteed your complete satisfaction. Like us on Facebook and follow us on Twitter @CNI_golddealer. Thanks for reading and enjoy your evening.