Daily Market Update 11/09/11

GOLD

Exciting time in the world’s financial markets as the Italian debt and leadership causes many of European equity markets to decline. Europe’s stock markets decline rolled over to the U.S. with our DJ average down 250 points. Gold continues to be the best safe haven investment, building an excellent base, just under $1,800. Right now at 11am PDT gold is at $1,794 per ounce, virtually unchanged from yesterday in the face of a stronger U.S. Dollar versus the Euro. Normally, if the value of the U.S. Dollar increases, gold sells off.

After finally breaking through the $1,700 area two weeks ago, gold consolidated nicely for a week, and then made a jump up in the last two days, breaking the resistance at the psychological level of $1,800 on Monday. Now gold is building a base for what I believe will be a very aggressive year-end rally.

In September China reportedly imported 140 tonnes of gold, more than it did for the whole of 2010 when approximately 120 tonnes were imported. This surge of buying and importing followed the sharp drop in the gold price at the end of the quarter, after it hit a record high earlier in the month. China’s inflation has slowed to a three year low, giving officials more room to support growth as the property market cools.

Chancellor Angela Merkel has ruled out using gold and currency reserves or IMF special drawing rights to boost the euro zone bailout fund for fear of violating the independence of Germany’s central bank, which opposes such use of reserves.

SILVER

At 11am PDT Silver is at $34.30 per ounce, down $0.81 on the day. Silver moved down today along with palladium and platinum due to concerns over a European double dip recession. The Comex silver net speculative length rose 239.2 tonnes last week to a total of 1,074.6 tonnes. This was due to a 61.6 tonne increase in longs and a 177.3-tonne reduction in shorts, according to the CFTC.

PLATINUM

Today platinum is trading at a $140 discount to gold. If you don’t already have some platinum, the popular 1oz .999 Australian Platinum Platypus coins is an excellent investment item.