Daily Market Report 2/26/13

GOLD

The International Monetary Fund (IMF) released data today showing that Russia and Turkey had added 12.7 and 10.3 tons of Gold, respectively, in the month of January. This combined with Fed Chairman Ben Bernanke giving Congress indications that the Fed would not cut short the current quantitative easing program of purchasing assets at the rate of $85 billion per month has led to today’s major rally in Gold. At 11am PDT today, Gold is up $25 per ounce, trading at $1,612 per ounce on heavy volume, and more important above the key $1,600 per ounce level. 

UBS is Predicting a ‘major Gold rally’

This year Gold is headed for a major uptrend, driven by the U.S. economy, says an analyst at UBS. UBS analyst Julien Garren explains the role the U.S. economy plays in influencing commodity prices is a delicate dance, but providing investors can be patient, it’s a winner for Gold. Part of the selloff for Gold last week was blamed on Fed minutes that triggered worries the central bank would wrap up its big asset-buying program faster than expected. That means holding Gold as an alternative to the U.S. dollar, seen as vulnerable to the Fed’s stimulus policies, is less urgent.

SILVER

Silver is showing excellent strength staying above $29 per ounce, but with Gold up $25 it would have been more bullish if it broke above the key $30 per ounce level. At 11am PDT, Silver is trading at $29.35 per ounce, up $0.33 per ounce on average volume.