Daily Market Report 4/3/13

GOLD

Gold has been on the defensive most of the day, reaching a major support level low of $1,550 per ounce earlier today. Yesterday and today’s $48 correction in the Gold price was mainly caused by the report from SPDR Gold Shares (GLD) --- the most popular paper Gold ETF ---of an eight metric tonnes drop in their Gold holdings.

In my previous reports I have talked about the “Tug of War” in the Gold trading pits. One of the major negative factors was the selling of paper Gold (GLD) by short term Gold investors to purchase equities. SPDR’s physical Gold holdings have dropped from 1,350 metric tonnes of Gold at the beginning of the year to 1,208 metric tonnes yesterday. This 142 metric tonne drop (10.5%) is a major negative for the Gold price, although the world’s precious metal markets have been finding major buyers (Central Banks?) within the current price range.

At 11am PDT today, Gold is trading down $23 per ounce at $1,554 per ounce with very heavy volume.

SILVER

Silver has broken down below the $27 per ounce level today reaching a low of $26.73. Silver’s next major support level is $26 per ounce, a multi-year triple bottom. At the current price level, Silver is an extraordinary value.

At 11am PDT today, Silver is trading at $26.94 per ounce, down $0.36 per ounce on heavy volume.