GOLD & SILVER PRICES FALL AS CHINA HOLDS GOLD BUYING

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	Is A Major Physical Silver Supply Squeeze Developing?
	At the COMEX market close Wednesday, June 5, the spot price of silver was up almost 25 percent from where it settled at the end of last year....Patrick A. Heller
	Double-Whammy Puts Strong Price Pressure On Gold, Silver
	Gold and silver prices are posting strong losses in early U.S. trading Friday... Jim Wyckoff
	Central Bank Gold Buying Picks Up In April
	The rapid rise in the gold price during March raised several questions.... World Gold Council
	China Faces Surge In Fake Gold Scams Amid Bullion Rush
	In recent months, China has witnessed a rise in fake gold scams, defrauding thousands of consumers....Avery Booker, Head of Data Jing Daily
	Silver Falls By Over 3% In Break Under $30
	It's a sell everything mood in markets today as the flight to safety reverberates across asset classes....Justin Low

Last Friday morning the Gold price was doing well, nearing $2,400 per ounce. Then came a report that the People’s Bank of China, after 18 months of non-stop buying, paused their purchases in May. Instantly the price of Gold and Silver started dropping.

When the markets reached the U.S., the U.S. Labor Department released the May employment report and it showed the key non-farm payrolls figure up 272,000. That’s well above the consensus forecast of up to 190,000 and compared to the revised April report gain of 165,000 jobs. The jobs number is a favorite economic indicator of the Federal Reserve in determining any change in the Fed Funds rate.

After both of these announcements hit the precious metal markets, I saw heavy selling. Gold reached a low of $2,284 per ounce, and closed at $2,291, down $80 for the day. Gold was only down $11 per ounce for the week. It’s important that the spot Gold price quickly moves back above the key $2,300 resistance/support level.

Today: Gold reached a low of $2,287 in Asian and European trading this morning. As Gold trading moved into the U.S., it found buyers that took the price back above the important $2,300 support/resistance level. Buying has been active in the U.S. as the Gold price moves towards $2,310 per ounce.

Like Gold, the Silver price also had a highly volatile day last Friday. Silver reached a high of $31.56 per ounce before the Chinese and U.S. Jobs numbers were released. After the announcement, we saw heavy selling as Silver broke below the $31 and $30 support levels.
Silver reached a low of $29.12 per ounce before closing Friday at $29.33 per ounce, down $1.17 per ounce for the week.

Silver has a past history of being very explosive when it breaks above $30 per ounce. In 2010, Silver moved from $30.10 on February 10th to $49.70 on April 25th, that’s a 65% move in only 74 days. During that time, Gold was only trading at $1,500 per ounce, which was a Silver-to-Gold ratio of 30.18-to-1. If we were to get to that same ratio again, Silver would need to be $77.80 per ounce based on the current Gold price.

Today: Although the Chinese halting their Gold purchases doesn’t directly affect the Silver price, the U.S. Jobs numbers do. If the Federal Reserve doesn’t lower the Fed Funds rate to stimulate the U.S. economy, Silver will have a difficult time continuing the current rally. Silver needs to move back above the key $30 per ounce level by month end to keep the current rally alive.

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