Daily Market Report 01/17/12

GOLD

Up, up and away, the 2012 gold rally has started. Seventeen days into 2012, and gold has increased by $90 or 5.5%. At 11am PDT Gold is up $13.30 per ounce, trading at $1,657.50 on heavy volume. Gold prices rose to the highest level in over a month as buyers speculated that slowing Chinese growth may lead to monetary policy easing this year, which is likely to increase demand for gold. The world’s second-largest economy grew 8.9 percent from a year earlier in the fourth quarter, beating a forecast of 8.7 percent by economists, although it was the slowest growth in 2-1/2 years.

For my clients who follow technical charts, the next resistance level is pegged at $1,670, while support is pegged at the 200-day moving average of $1,640.70.   

SILVER

Yes! The second day in a row above $30 per ounce. At 11am PDT is trading at $30.18, up $0.17 per ounce on excellent volume. Silver did reach $30.70 in overnight Asian trading after the Chinese GDP announcement.

A report released today by the Silver Institute forecasted that industrial fabrication would increase by 37 percent between 2010 and 2015, meaning a potential increase from approximately 488 million ounces (m/oz) to 666 m/oz.

PLATINUM

Platinum also rose to its highest since December 8th at $1,535.50 per ounce. At 11am PDT Platinum is trading at $1,527, up $18.50 per ounce. The Gold/Platinum spread is now down to $130 per ounce. Platinum shrugged off poor bad European car sales numbers for December and 2011 - sales fell 6.4 percent in December, bringing the total for the whole of 2011 down 1.7 percent.