Daily Market Update 4/20/11

GOLD
Gold closed today at $1,501.50 up $3.90, after reaching $1,507 in this morning’s trading. The impetus for today’s increase in Gold and Silver is clearly the weaker dollar, which is getting hammered and fell to its lowest level in the past 15 months against the euro. The greenback dropped against the euro on speculation that the European Central Bank will continue to raise borrowing costs as some nations struggle to contain sovereign debt, while the U.S. will continue to keep interest rates low. Standard & Poor’s yesterday revised its long-term outlook on U.S. debt to negative from stable. In the past year Gold has climbed 32%, and silver prices have more than doubled, as the dollar fell 7.4%

SILVER
Silver is still the best performer in the precious metal area, up another $1.10 today. Silver closed at $44.84, but hit $45.43 in the morning on very heavy volume. Trading is extraordinarily active with a fair amount of profit taking followed by another round of buying. We are witnessing a true Bull/Bear fight with professionals trying to figure out the short term trend. Any news about inflation, weaker dollar, euro zone crisis, Chinese demand or economic numbers has a 5-10 minute shelf life of activity. The trading range today was $1.21, from the low of the day $44.22 to the high of $45.43.

Today’s Important News

The University of Texas endowment fund decided to buy and take delivery of $1 billion worth of gold.
Existing US home sales rose 3.7 percent in March to an annualized rate of 5.1 million units, slightly ahead of expectations, the National Association of Realtors said this morning.
The International Monetary Fund chief economist Olivier Blanchard said, “ the US government does not have a credible plan to cut the deficit”.

For many of my clients and friends who are Gold & Silver addicts, I am now posting on Twitter multiple times during the day and night.