Commentary for Friday, Dec 6, 2013 (www.GoldDealer.com) – Gold closed down $2.90 at $1230.30 but the market did weaken earlier ($1210.00) on news of strong employment numbers before reversing itself and moving higher.
So we are still stuck with this dichotomy trading system which revolves around the Federal Reserve and when it might change its monetary easing program. But also consider this week the huge 3rd quarter GDP revision of 3.6%, home sales up 25% and a price deflator (inflation) of 2% which creates a very nervous short trade.
Silver was down $0.05 at $19.46 with physical sales remaining steady but certainly not hot and silver buzz is nonexistent so does anyone have a good silver shortage rumor?
Platinum was down $7.00 at $1357.00 which makes for a weekly loss of $12.00 which is perplexing, why this weakness in platinum? I have had several inquiries and cannot come up with any real explanation considering the surge in auto sales, unless you figure the “world-wide economic recovery” story is bunk.
Palladium closed down $1.00 at $735.00 but up $16.00 on the week.
And now the famous survey: In the Kitco News Gold Survey, out of 34 participants, 19 responded this week. Of these, seven see prices up, while seven see prices down and five see prices sideways or are neutral. Market participants include bullion dealers, investment banks, futures traders and technical-chart analysts. Last week, survey participants were evenly divided over gold’s direction. As of noon EST Friday, February gold on the Comex division of the New York Mercantile Exchange was down about $24 an ounce for the week. Those who see prices rising next week said given that gold rallied following a solid November nonfarm payrolls report is a sign that bears’ grip on the market is growing tired. “The past four weeks has been dominated by new short-sellers that forced some longs to flee positions. Combine that with the most bearish sentiment since the mid-October low, I look for gold to have a short-covering rally in its near-term future. I expect a $1,265 upside target during the week ahead,” said Ken Morrison, founder and editor of online newsletter, Morrison on the Markets. A number of other market participants said they weren’t buying Friday’s rally, saying the overall trend for gold remains lower. “I think the market will be lower next week. Although we are starting to see strong physical buying out of Southeast Asia, the Middle East and China the ETF (exchange-traded fun) selling that we are also seeing should be enough to offset the demand. The shorts are still in control even though we have seen some vicious short-covering rallies. We are seeing some strong economic data lately and I think that will add to the pressure in gold,” said Kevin Grady, president of Phoenix Futures and Options. The participants who are neutral said they see the market consolidating in the current trend between $1,210 and $1,250.”
A reader comments on our new website: “I hate it! Us old timers have a hard time with computers. From 2003 to the present I loved your old website. I knew what to do and how to get what I needed. I got it quickly. I know it is your first day and I’ll be patient.” Most humble answer: The old web site used outdated HTML code so our web presence was beginning to fade and the metals business is moving to 24/7 live site pricing. What has not changed is our commitment: low prices and honest service. I was not particularly happy with the iphone when it first launched and now it is a permanent part of life. J
According to DNA (Indian Content Licensing) more than 500kg of gold is smuggled into India every day. Over 85% of gold imports were in jewelry, unlike China where over 50% are for industrial use, like IT chips, integrated circuits and transistors. The demand for gold is always on the rise; every Indian invests in gold and even the poorest of the poor would gift gold as part of the tradition, be it the arrival of a new baby in the house, wedding or a success in job or education.”
The walk-in cash trade was fairly busy today and the phones were steady all day. The GoldDealer.com Activity Scale remains steady at “6” and we continue to see rather large gold sellers. The CNI Activity Scale takes into consideration volume, open and closed orders (buying and selling), the cash trade, and the hedge book: (last Monday – 8) (last Tuesday – 7) (last Wednesday – 6) (last Thursday – 7) (Friday – 6). The scale is 1 through 10 and we believe this is a reliable way to “sense” what a real bullion business is doing without the sales pitch.
The new GoldDealer.com site is up and running and we continue to make changes and adjustments to various pages. Some pages on the old site were not carried forward so while the site ID has not changed a particular landing page might need adjustment. This new approach will show you live buy and sell bullion prices but you must talk with a live person to confirm and receive an order number. It will also soon include Live Chat, you will be able to set up your own customer account, receive automatic email confirmation, and ask for the daily Gold Newsletter email.
Phase Two will make accounting, shipping and tracking easier. We now offer the choice of USPS or FedEx Ground. Our new flat screens within the CNI Building are operational and cash is always available. The feed and graphs are live and bullion products are programmed with premium spreads: there is nothing like this on the West Coast and visitors enjoy complete transparency.
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The CNI Holiday Schedule: We will be closed Tuesday, Wednesday and Thursday (Dec 24th, 25th and 26th) for Christmas. For New Year’s we will be closed Tuesday and Wednesday (Dec 31st and Jan 1st): a reminder that shipping during the holiday season slows so your patience is appreciated. Thanks for reading and enjoy your weekend.