Daily Market Update 3/31/11

GOLD
Gold rallied today closing up $13.10 to $1,437.30 on continued weakening of the U.S. dollar against the most actively traded foreign exchange currencies. I believe we will have a short wait for the next Gold breakout, whether it is due to continued Dollar weakness, the Euro Zone sovereign debt crisis, a civil war in Libya, escalating demonstrations in Syria and Bahrain, or the aftermath of the earthquake/ radiation problems in Japan. Very soon one of these issues will drive a sizeable amount of buying into Gold (the real safe haven in times of crisis) to take the Gold price through $1,450 to the next resistance area of $1,500.

Crude oil prices are higher Thursday, trading over $105.00 a barrel. The inflationary implications of crude oil prices remain bullish for the precious metals markets. The crude oil market is an excellent gauge of the current world geopolitical tensions in North Africa and the Middle East.

SILVER
Silver rallied to a new 31 year high, hitting $38.00 before closing at $37.80, up $0.36 for the today.  Continued strong worldwide demand, especially from India is driving prices higher. Due to the heavy physical demand for Silver the ComEx reported that Silver Stockpile’s dropped 77,028 yesterday to 104,438 million ounces, continuing the trend of lower stockpiles of the precious metal. I expect the Silver price to move higher quickly after seeing some light resistances at $38.00 on ounce. At the current rate I see Silver at $40.00 by July.

Today’s Important News
The number of people who filed first-time claims for jobless benefits fell by 6,000 to a seasonally-adjusted 388,000 in the week ended March 26, the Labor Department reported Thursday. Yet that decline occurred after claims in the prior week were revised up, to 394,000 from an originally reported 382,000.

I’m attending the Whitman Baltimore Coin Convention right now, and demand for U.S. Gold and Silver Coins continues to grow. Many of the dealers at the show confirm record demand from the public, especially for lower priced Silver coins.