Daily Market Report 06/22/12

GOLD
Gold has dropped to the $1,530 area three times in the past seven months and every time that happens, it rallies back up on massive buying, ultimately moving above $1,600 per ounce. I believe this massive purchasing of Gold is being done by central banks, as they have been very active in the Gold market for the past three years. Many developing countries don’t want to hold a large amount of U.S. Dollars and Euros in their central bank reserves, so Gold is the only alternative.  

Today Gold has traded in a very narrow $14 range, from $1557 to $1,571 per ounce. I expect to see a rally on Monday, as Asian markets will take advantage of the low price. As of 11am PDT, Gold is trading at $1,566 per ounce virtually unchanged from yesterday on normal Friday type volume.

SILVER
Silver is trading right off the yearly lows, between $26.48 to $27 per ounce. Silver needs to get above $28 per ounce very soon to regain its bullish short term sentiment and above $30 per ounce to look long term bullish. The European financial crisis and the possibility of a global recession are weighing heavily on Silver. At 11am PDT, Silver is trading at $26.75 per ounce, down $0.23 from yesterday on average volume.

Many Indian investors are making a beeline for Silver, and are refraining from buying Gold due to its high price, though Gold is expected to give a 20% return in 2012. See the complete article at
http://www.mintstategold.com/investor-education/silver_coins_hot_in_india/