Daily Market Report 02/21/12

GOLD

Gold is off and running again based on the world news released over the long weekend. Both the developments in China and Greece (Shown below) are highly bullish for gold and will be the catalyst for the gold break-out above the $1,760 resistance level I have been looking for. At 11am PST, Gold is up $28.20 from Friday’s close, trading at $1,752.80 per ounce on high volume.

CHINA

China cut its required reserve ratio over the weekend, joining a number of central banks in relaxing monetary policies to promote economic growth while the euro zone debt crisis continues to overhang the global economy.

GREECE

Euro zone finance ministers agreed to the 130-billion-euro ($172 billion) Greek rescue package on Tuesday. These funds will resolve its immediate financing needs but seems unlikely to revive the nation’s shattered economy. After 13 hours of talks, Eurozone officials said ministers had finalized measures to cut Greece’s debt down to 120.5% from approximately 160% of gross domestic product by 2020, after negotiators for private bondholders accepted a 70% loss on the value of the debt to help plug Greece’s funding gap. The IMF & ECB were parties to the negotiations and have agreed to provide additional financial assistance.

SILVER

Silver followed gold up this morning. The news out of Greece and China will ultimately be more bullish for Silver than Gold, but we need to see signs of the inflation these moves will create. At 11am PST, Silver is trading at $34.10, up $0.77 from Friday’s close. Trading in the Asian, European and U.S. commodity markets has been very active.