Daily Market Report 10/3/12

GOLD

Gold continues to consolidate, trading in a very narrow $10 range all day with low/high between $1772 and $1782 per ounce. If the price pattern of the past seven weeks continues, we should see a nice rally tomorrow or Friday, so if you are considering adding to your Gold position, do it today. At 11am PDT, Gold is trading at $1777.40, up $1.80 per ounce on a normal volume of trading activity. 

BILL GROSS OF PIMCO LIKES GOLD

Pimco founder and co-chief investment officer Bill Gross warns that the U.S. will no longer be “the first destination of global capital” seeking safe returns if it doesn’t address its fiscal gap. The U.S. “will begin to resemble Greece before the turn of the next decade” if it continues to close its eyes to deficits, Gross said.“Unless we begin to close this gap, then the inevitable result will be that our debt/GDP ratio will continue to rise, the Fed would print money to pay for the deficiency, inflation would follow and the dollar would inevitably decline. Bonds would be burned to a crisp and stocks would certainly be singed; only Gold and real assets would thrive within the ‘ring of fire,’” Gross said.

SILVER

I really like the way the Silver price has been building a base over the past few weeks. This morning there was some commodity professional selling when the price reached the $35 per ounce resistance level. So, today’s trading range was between $34.47 to $34.99 per ounce. At 11am PDT, Silver is up two cents per ounce, trading at $34.75 per ounce.