Weekly Market Report 9/26/16
Links to recent informative articles on precious metals and rare coins:
Demand for Gold could turn red hot thanks to the war on cash
Gold seen entering a long-term bull cycle
Gold
Silver
Recommended investment commitment and diversification
Last Wednesday morning, Gold jumped $10 after the Bank of Japan announced they will be introducing a zero interest rate target for ten-year government bonds. With most of the world’s largest central banks going to zero or negative interest rates, it will be very difficult for the Fed to increase interest rates anytime soon. Then early Wednesday afternoon, the Federal Reserve stated that it is not raising interest rates now and also lowered its projections for future rates until 2019. After the Wednesday Fed statement, Gold rallied an additional $16 on Thursday.
Last week, Gold closed at $1,341.70 per ounce, up $31.50 per ounce for the week and up $281 (26.54%) for the year. This week I look for Gold to consolidate last week’s gain, and then start moving towards the key $1,350 per ounce resistance level.
As we approach what I feel will be the start of the 2016 Fall/Winter rally, let’s recap Gold’s trading in 2016. From January 1st to August 2nd of this year, Gold increased $312.60 per ounce (29.5%), from $1,060 to $1,372.60. From August 2nd to September 16th, Gold traded between $1,309 and $1,370 per ounce, consolidating its 29.5% increase. During the past 2 months, Gold has built an excellent base for its next leg higher in 2016, and I continue to think that Gold will reach $1,500 per ounce by December.
Today: This morning Gold continues to build its base in the $1,340 per ounce price area. Physical demand for Gold investment products is growing in Asia and Europe. Gold is currently trading at last Friday’s price levels.
Last week, after the Federal Reserve announcement, Silver rallied $0.95 per ounce, closing at $19.81 per ounce on Friday. At one point last Thursday, Silver reached a high of $20.15 per ounce. Currently, some professional traders are selling into Silver rallies above $20 per ounce. So, I expect to see Silver trading between $19.25 and the $20 support/resistance level for the short term.
Considering the 43% increase in the Silver price since the beginning of the year, I believe the summer price consolidation has been very healthy for the long term. Once Silver firmly moves above the key $20 long term resistance level, I expect to see it quickly reach its July 5, 2016 high of $21.23 per ounce before the end of October.
Last week, the Silver/Gold ratio increased to 67.72-to-1.
Today: Silver tested its recent support level of $19.40 this morning, reaching a low of $19.39. At that price level, bargain buyers appeared and quickly took the price up $0.15 per ounce. I look for Silver to take another run at the $20 per ounce resistance level later this week.
Recommended Investment Commitment and Diversification:
Precious Metal commitment: Minimum of 30% of investment capital
Diversification: Gold 50%, Silver 40%, Platinum & Palladium 10%
Diversification includes 50% in long term investment quality rare coins and 50% short term bullion products.
REMEMBER THE BLOG
If you want to be updated on what is happening in the Gold, Silver, and Rare Coin markets any weekday, our company offers a daily blog Monday through Friday at www.stupplerblog.com
All statements, opinions, pricing, and ideas herein are believed to be reliable, truthful and accurate to the best of the Stuppler & Company’s knowledge at this time. Stuppler & Company disclaims and is not liable for any claims or losses which may be incurred by third parties while relying on information published herein. Individuals should not look at this publication as giving finance or investment advice or information for their individual suitability. All readers are advised to independently verify all representations made herein or by its representatives for your individual suitability before making your investment or collecting decisions.
