Gold Briefly Set A New Record High Over $2,100 Then Sold Off
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Stuppler & Company is proud to provide our clients this Weekly Market Report (WMR). The report gives you my overview of the prior week’s precious metal and rare coin market activity and news. In each WMR, I share the current status of Gold and Silver along with their support and resistance levels. |
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This Week's Headlines: |
The week ending Dec. 1st was a great week for Gold investors. The key bullish factors came together last week, with interest rates dropping, the U.S. Dollar selling-off, geopolitical issues worsening, and Fed Chairman Powell gave a dovish speech on no more increases in Fed Funds rate. Gold reached a high of $2,076 per ounce, and closed at $2,071, up $69 for the week.
Since 2001, when the price of Gold was $270 per ounce, to today with the Gold price over $2,075 per ounce, I have helped over 10,000 investors buy Gold bullion and investment Gold coins. During that period, the fundamental reasons for owning Gold as part of a diversified investment strategy and building family wealth have continued to improve. As the U.S. and foreign governments print over 50 trillion of dollars, Yen, Yuan, and Euros to bailout problem companies and banks while stimulating their economy, most of those countries are holding and buying large quantities of physical Gold for their reserves.
Looking at the recent deterioration of the value of global currencies, I believe Gold is a better value today over $2,075, than it was in 2001 at $270. Additionally, Gold today has become a more acceptable investment for the mainstream investor. So why do many investors refuse to average up by adding to their holdings? After listening to a client last week, it became clear I needed to send this email. I asked him why he didn’t respond to the many offering emails I sent him during the year. His answer was, “Well I had the money, I just did not want to increase my average cost.” The point of this email is that it is not prudent to build up currency assets (stocks, bonds, real estate, and savings accounts) during a period when governments are printing more and more currency to offset sizeable budget deficits. The dramatic price increase in the Gold price over the past years is a direct result of increasing government debt and trade deficits, which is extraordinary and at a scary pace.
Moody's credit rating agency this month downgraded the U.S. economic outlook to "negative" from "stable." It is the latest in a series of issues flagged by rating agencies about the weakness of the financial status of the United States.
Gold above $2,075 per ounce at the end of December 2023 is on track. I look for Gold to reach $2,400 year end 2024. In 2001, with Gold trading at $270 per ounce, the National Debt was $3.3 trillion. Today, we are over 10x that amount at almost $34 trillion debt for an unbelievable call to reality. See www.usdebtclock.org
Today: In overnight computerized trading Gold prices soared to a record high briefly above $2,100 in very early Asian trading. Traders grow increasingly confident the Federal Reserve will cut interest rates in the new year. The yellow metal then receded below the $2,100 on profit taking as markets in Europe started trading.
All the bullish fundamentals are coming together for Silver: Silver has broken above key resistance levels, both demand and trading volume are moving higher, plus supply problems have increased.
See Demand For Silver Is Greater Than New Supply, Will It Matter?.
Last week Silver broke above the key $25 per ounce resistance level, closing at $25.48 per ounce. Silver was up $1.81 or 7.65% for last week, and up $4.63 since the Oct. 4th low.
Based on Friday’s prices, the Silver-to-Gold ratio remains at 81-to-1, still an excellent investment opportunity.
Today: Silver moved higher in very early overnight trading with Gold. Silver reached a high of $25.61 before seeing selling.
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