GOLD
What a day yesterday and today was in the Gold pit. Volume today is almost double what a normal day would be and the excitement when Gold dropped below $1,600 was off the charts. Considering the strength of the U.S. Dollar and the problems in Europe, it isn’t surprising to see Gold make a new yearly low of $1,577.40, but that is when the rally began. If the trading in the aftermarket continues, this could be an inter-day reversal, which is very bullish. When a commodity market makes new lows and closes the day on the highs it’s called an inter-day reversal. At 11am PDT, Gold is trading at $1,597, which is the high for the day and down only $7.60 from yesterday. If you are looking for a good entry point to buy or add to your holdings of Gold, today is an excellent day.


SILVER
Silver, Platinum and Palladium followed the Gold trading today. Silver made a new low of $28.54 per ounce, then we saw sizeable demand and the Silver market quickly rallied back to $29.30 as the volume picked up. At 11am PDT, Silver is trading at $29.44, down only $0.09 per ounce from yesterday and closing at the high of the day. The Silver/Gold ratio today is 54 to 1, which makes it an excellent time to pick up some Silver.

GOLD
In Greece, New Democracy, the country's mainstream center-right party, has declared that it will not be able to form a government. This has caused instability within the Euro-zone nations and the euro has fallen versus the U.S. Dollar. As the U.S. Dollar moves higher in value against other currencies, it drives down the value of Gold and Silver. Therefore we have Gold down today, and at 11am PDT, Gold is trading at $1604.60, down $35 on heavy volume.

The shine is back on gold jewelry in India with the government scrapping the 1% excise duty imposed on gold jewelry, raising expectations of an immediate pickup in demand.

China imported 62.9 tonnes of Gold from Hong Kong in March, 59 percent higher than February, and up sixfold on the same month of last year. Commerzbank AG stated, “Rising prosperity levels among the Chinese population coupled with tighter laws governing property speculation are likely to contribute to sustained high demand for gold in China.”

SILVER
Silver has bottomed below the important $30 support level on heavy trading. If it can’t rally above $30 within the next few days, look for the market to test the $28 level. At 11am PDT, Silver is down $0.86, trading at $29.53 per ounce.

The Market Report provides you with an update on the precious metal markets. This week I discuss the results of an American Investor Gallup Poll and “Why is the new President of France bullish for Gold and Silver?”

GOLD

Another week of base building with gold apparently locked into a trading range of $1,630 to $1,670 per ounce.  It’s clear that the gold market is treading water, awaiting the bullish news that will stimulate the fundamental buyers to drive the price above $1,700 per ounce. Last week, Gold ended the week at $1,645.20 per ounce, down $19.60 per ounce with an active volume of trading on the up and down days. The short term professional floor traders were selling on rallies and buying on dips, ending the week neutral, with no open positions. The opinion from many professional traders is that the market direction is neutral, compared with last week when the majority was slightly bearish.

Gold trading during the past seven months has reminded me of the same things that happened in 2008/09. Let me explain.  On March 17, 2008 gold set an all-time high of $1,011, an increase of over 50% in price in just 6 months.  After breaking above the $1,000 per ounce mark, the price of Gold declined to a low of $712 in six months. During that six month period it was difficult for me to convince our clients that the uptrend was still intact, since CNBC analysts were saying that Gold was on its way back to $200 per ounce.   Well, gold rallied back up and traded between $895 and $980 for seven months, building a base, before breaking out above $1,000 again. Within three months of breaking above $1,000 for the second time, the gold price continued higher, reaching over $1,200 per ounce. 

Why do I think history is repeating itself? 

After reaching $1,920 per ounce on Sept 6, 2011, Gold has traded between $1,524 and $1,800 per ounce, building a similar base for the past seven months. With Gold currently at $1,645 per ounce, I believe that a price move to the higher end of Gold’s trading range should happen very soon.

Can 2 ½ Million Chinese be Wrong?

It was just reported that in 2011 China imported (through Hong Kong) 428 tons of Gold. The latest figures show that the rate of Gold accumulation in China is increasing.  More than 79 tons of Gold was acquired through the end of February, putting China on the path to acquire 479 tons in 2012. Much of this demand is coming from the Chinese Gold Bank accumulation programs.  At this rate, China will be the largest importer of Gold in the world, over taking India (whose government is protecting the rupee and has turned hostile towards Gold importation) even though India’s population is fighting this every step of the way.  

In the past two years, the ICBC Bank Gold Accumulation program in China has grown to 2 ½ million Chinese clients. At the current pace of growth, the bank should have over 5 million Gold accumulation clients by 2015. ICBC bank is currently holding over a billion dollars of Gold in their vaults. Gold Accumulation programs have not only been very successful in making Gold more accessible in cities, but also in more rural parts of China as well, making the owners of these accounts into long term investors.  India has had a similar program in place since 2009 that has been very successful. The India Post retail outlets, in association with Reliance Money and the World Gold Council, launched a program that allowed Indian citizens to purchase gold at India Post outlets in 9 regions of the country.  

April Gallup poll on Investments

According to a recent Gallup poll, Gold leads four other types of investments (when Americans were asked to pick the best long-term investment). The poll found that 28% of Americans view Gold as the best investment vehicle for the long-term, as compared to 20% who selected real estate. Paper assets, like stocks and savings accounts, were tied for third place with 19%, and bonds finished last with only 8%. The new findings were part of Gallup’s April update of its annual Economy and Personal Finance poll.

Why is the New French President bullish for Gold and silver prices?

The new French President, Francois Hollande (a socialist) has campaigned on a promise to promote government stimulus programs rather than focus on harsh austerity measures that Sarkozy had favored. Hollande has said that his first task as President will be to call for a renegotiation of the European budget-trimming treaty, spearheaded by Sarkozy and German Chancellor Angela Merkel. Hollande wants to see more government-funded stimulus programs instead of doing drastic cuts across the board.

SILVER

Silver managed to close above its long term support level of $30 per ounce all five days last week. Silver closed at $30.43 per ounce on Friday, down $0.91 for the week. CME trading volume increased every day that Silver tested the $30 level.  Last week much of our domestic economic news and the U.S. Labor Department’s April jobs report were negative, leading to more talk about QE3.

The Federal Reserve previously said that it would take deterioration in the labor market, with inflation staying in check, as a signal to consider launching a third round of so-called quantitative easing. Additional accommodative policy is seen as unequivocally bullish for Gold and Silver as increased liquidity tends to debase the dollar and create inflationary risks.

PLATINUM

Last week, with Gold down $19 per ounce we saw Platinum drop $39, closing the week at only $1,536 per ounce. Platinum’s discount to the price of Gold is currently at an unbelievable $109 per ounce. This provides you an opportunity to purchase Platinum at a 7% discount to Gold. A discount of this size rarely happens, so I have increased the recommended investment diversification for Platinum to 15% of your precious metal commitment.  The Canadian 1oz Platinum Maple Leaf is the most active platinum trading vehicle, and because it is our #1 selling Platinum bullion item we can offer them at only 5.75% over spot.  For a current quote on this item please visit: http://www.mintstategold.com/platinum-1/bullion-coins-and-bars/platinum-canadian-maple-leafs.html

Recommended investment commitment and diversification:

Precious Metal commitment: Minimum of 35% of investment capital

Diversification:  Gold 50%, Silver 35%, Platinum & Palladium 15%

Diversification includes 50% in long term investment quality rare coins and 50% short term bullion products

REMEMBER THE BLOG

If you want to be updated on what is happening in the gold, silver, and rare coin markets any weekday, our company offers a daily blog Monday to Friday at www.stupplerblog.com

All statements, opinions, pricing, and ideas herein are believed to be reliable, truthful and accurate to the best of the Stuppler & Company’s knowledge at this time.  Stuppler & Company disclaims and is not liable for any claims or losses which may be incurred by third parties while relying on information published herein.  Individuals should not look at this publication as giving finance or investment advice or information for their individual suitability.  All readers are advised to independently verify all representations made herein or by its representatives for your individual suitability before making your investment or collecting decisions.

GOLD
Gold declined on Monday based on political upheaval in France and Greece leading to a weaker euro (stronger U.S. Dollar) and softer commodity markets. At 11am PDT, Gold is trading at $1,639.60, down $4.90 per ounce on very active volume.  

Why is the new French President bullish for Gold and Silver prices?
The new French President, Francois Hollande (a socialist) has campaigned on a promise to promote government stimulus programs rather than focus on the harsh austerity measures Sarkozy favored. Hollande has said that his first task as president will be to call for a renegotiation of the European budget-trimming treaty, spearheaded by Sarkozy and German Chancellor Angela Merkel. Hollande wants to see more government-funded stimulus programs instead of drastic cuts across the board.

SILVER
When Silver hit $29.60 per ounce this morning, the war between the bulls and bears started. As the Silver price increased on excellent volume the price rallied back to $30.39. At 11am PDT, Silver is down $0.23, trading at $30.12 per ounce. It is important for the short term Silver price that $30 per ounce holds as major support.
 
The Shanghai Futures Exchange (SHFE) is all set to launch Silver futures trading on May 10, 2012. China is one of the biggest producers and consumers of Silver in the world. The contract size is set at 15 Kg (500 troy ounces) with a minimum margin requirement of 7%. The daily price range has been fixed at 5%.

GOLD
This morning, the U.S. Labor Department stated that our economy added just 115,000 jobs in April, below a forecast of 173,000 making the jobless rate 8.1%. Gold rallied $20 after the announcement because this added to the reasons why the Federal Reserve should consider QE3 to keep our economy from another recession. At 11am PDT, Gold is trading at $1,644.50, up $10.10 per ounce on the day and up $16 after the U.S. jobs announcement.  

The Federal Reserve has previously said that it would take deterioration in the labor market, while inflation stayed in check, for it to consider launching a third round of so-called quantitative easing. Additional accommodative policy is seen as unequivocally bullish for Gold as increased liquidity tends to debase the dollar and creates inflationary risks.

SILVER
Silver continued to show extraordinary support at the long term resistance $30 per ounce level. Again, this morning Silver sold off, reaching $29.75 per ounce in Asia, but quickly rallied back.  At 11am, Silver is up $0.20 on the day, trading at $30.39 per ounce on heavy volume for a Friday.

GOLD
Gold was under pressure on Thursday after disappointing data from both sides of the Atlantic fueled concerns about global growth, while investors awaited a rate decision by the European Central Bank tomorrow for more input on trading direction. At 11am PDT, Gold is down $19.20 per ounce, trading at $1,634.40 per ounce on an average volume.       
        
April Gallup poll on Investments
According to a recent Gallup poll, Gold leads four other types of investments when Americans were asked to pick the best long-term investment. The poll found that 28 percent of Americans view Gold as the best investment vehicle for the long-term, compared to 20 percent selecting real estate. Paper assets, such as stocks and savings accounts, were tied for third place with 19 percent, as bonds finished last with only 8 percent. The new findings were part of Gallup’s April update of its annual Economy and Personal Finance poll.

SILVER
Silver is taking direction from Gold today. The fundamentals are still in place and as long as Silver stays above $30 per ounce, the long term trend line is in place.  At 11am PDT, Silver is down $0.36, trading at $30.19 per ounce on heavier than average  volume.

Precious metals have been relatively quiet this week. After posting its best weekly gain in two months, gold is trading slightly lower at about $1,650 per ounce. Meanwhile, silver is trading near $30.50 per ounce. Gold and silver are currently taking a pause, but have been in a bull market for more than a decade and apparently Americans are taking notice.

According to a recent Gallup poll . . . .

GOLD
Gold has been weaker today based on a stronger U.S. Dollar. Gold traded between $1,645 and $1,661 per ounce for most of the day.  At 11am PDT, Gold is down $9.10 per ounce holding at $1,653.60 per ounce.

The Commerce Department reported today that orders for goods produced in U.S. factories dropped 1.5% in March, the biggest decline in three years.

SILVER
Silver is weaker than Gold today on light volume.  Silver was range bound between $30.31 and $30.82 per ounce in slow trading.   At 11am PDT, Silver is holding around $30.55 per ounce, down $0.49 per ounce.

GOLD
Gold was range-bound from $1,656 to $1,672 today as commodity trading in a number of Asian precious metal markets, including China, Hong Kong, India, Malaysia, Philippines, Singapore, South Korea, Thailand, Taiwan and Vietnam, are closed for the May Day holiday. At 11am PDT, Gold was trading at $1,662.50, down $2.90 on light volume.       

                                                                             Can 2 ½ Million Chinese be Wrong?
It was just reported that in 2011, China imported, through Hong Kong, 428 tons of Gold. The latest figures show the rate of Gold accumulation in China increasing.  More than 79 tons through the end of February puts China on a path to acquire 479 tons in 2012. Much of this demand is coming from the Chinese Gold Bank accumulation programs.  At that rate, China will be the largest importer of Gold in the world, over taking India, whose government, to defend the rupee, has turned hostile to Gold importation which the population is fighting every step of the way.  

In the past two years, the ICBC Bank Gold Accumulation program in China has grown to 2 ½ million Chinese clients. At the current pace of growth, the bank should have over 5 million Gold accumulation clients by 2015. ICBC bank is currently holding over a billion dollars of Gold in their vaults. Gold Accumulation programs have not only been very successful in making Gold more accessible in cities, but also in more rural parts of India and China as well, plus the owners of these accounts are long term investors.

SILVER
Silver was supported by lower than expected U.S. consumer spending in March. The increase was only 0.3%, after a sharp increase in February. Silver was down $0.02, trading at 11am PDT at $31.04 on a low volume of trades.

This week's Market Report provides you with an update on the precious metal markets and I discuss “Why I am confident that the price of gold is going to set new all-time highs this year.”

GOLD

Gold ended last week up $22 per ounce, closing Friday afternoon at $1,664.80 on heavy volume. I believe that last week the price of Gold finally bottomed out.  On Wednesday, the bears aggressively sold off Gold after hearing no mention of any future quantitative easing in the FOMC policy statement. However, when Gold hit $1,625 per ounce the trading volume picked up substantially and the price started to rally sharply.  This is the fourth time that I have seen gold demand and trading volume pick up sizably when gold is in that same price area.  The gold market is telling me that “Gold doesn’t want to go down.”  The only question is, "when will it breakout above $1,700 per ounce and resume its move to new all-time highs?"

Why am I so confident that the price of Gold is going to set new all-time highs this year?

The smartest fiscal and economic experts are employed (as consultants and financial ministers) by many of the world’s largest sovereign countries. These experts are responsible for protecting the countries trillions of U.S. Dollars, Pesos, Euros, Yen, and Yuan, that are being held as part of their vast reserves. Until 2009, these experts were advising these governments to sell Gold and keep U.S. Dollars as the primary part of the countries reserves; now these experts have changed their tune. Over the past two years, many countries including the BRIC countries (Brazil, Russia, India, and China) are exchanging their U.S. Dollars and Euros for Gold.

Last week, the IMF released the latest Central Bank Gold holdings data, which showed a net increase of 439 metric tonnes in 2011 (a 50-year high). An additional 57 metric tonnes were purchased by 11 countries just during the month of March 2012.  Mexico and Russia showed the most notable 2012 reserve increases, with about 16 tonnes each in March. Central Asian nations also caught some attention since they were net purchasers.  The trend of Central Banks diversifying their holdings out of US Dollars and into Gold has been intact for several years now and should continue into the coming years.

SILVER

Last week, while Gold was up $22 per ounce, Silver was down $0.30 per ounce, closing the week at $31.34.  After breaking the long term $30 per ounce resistance level on Wednesday, Silver came roaring back on heavy volume, closing Wednesday at $30.35 per ounce on the highest volume of trading for the week. I am convinced that the risk/reward for Silver at its current price is extraordinary.  You risk $1.00 per ounce with the possible short term reward of $5 per ounce, with the current Silver/Gold ratio at 53 to 1, showing that Silver is a better value than Gold.

The Silver Institute has just reported that physical Silver investments grew by a sizable 67% in 2011 to 96.7 million ounces.  The demand in Western Europe and the United States set new records for American Silver Eagle Bullion Coins, but the strongest demand came from China, which accounted for 60% of the demand for Silver bullion coins in 2011. The Silver Institute has also reported that 2011 saw a notable growth of 53% in Comex Silver futures turnover, in terms of the annual average.

Recommended investment commitment and diversification:

Precious Metal commitment: Minimum of 35% of investment capital

Diversification:  Gold 50%, Silver 40%, Platinum & Palladium 10%

Diversification includes 50% in long term investment quality rare coins and 50% short term bullion products

REMEMBER THE BLOG

If you want to be updated on what is happening in the Gold, Silver, and Rare Coin markets any weekday, our company offers a daily blog Monday to Friday at www.stupplerblog.com

All statements, opinions, pricing, and ideas herein are believed to be reliable, truthful and accurate to the best of the Stuppler & Company’s knowledge at this time.  Stuppler & Company disclaims and is not liable for any claims or losses which may be incurred by third parties while relying on information published herein.  Individuals should not look at this publication as giving finance or investment advice or information for their individual suitability.  All readers are advised to independently verify all representations made herein or by its representatives for your individual suitability before making your investment or collecting decisions.