Weekly Market Report 2/3/14

This Week’s Headlines:

Gold
China Opens its Gold Market to Foreign Banks
Rare Coin Report
2014 CoinStats Now Available
Silver
Recommended Investment Commitment and Diversification

GOLD

Last week was the only week in 2014 where the price of Gold declined. Gold was however up $37.90 (3.15%) for the month of January. Gold ended the week and the month at $1,239.80 per ounce last Friday. In January, Gold tested the $1,270 per ounce resistance level three times but could not hold above that level. Today, Gold is back on its bullish trend, up $22 per ounce. I look for Gold to make a few more attempts at breaking out above the $1,270 level this week as it makes its way to $1,300 per ounce.

Gold dropped $25 per ounce last Thursday after data showed robust household spending and rising exports which both helped the U.S. economy to grow 3.2% in the fourth quarter of 2013. The thinking is that a strong economy will result in getting the Federal Reserve to continue cutting their current $65 billion monthly bond buying program.

The U.S. Mint Gold coin sales rose 63% in January 2014 to their highest level since April of 2013, while the Gold price increased 3.15%. The volume climbed to 91,500 ounces from 56,000 ounces in December. Many of the other world’s largest mints, i.e. Austria, the U.K. and Australia, also reported that accelerating demand has caused them all to reach record production levels.

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China Opens its Gold Market to Foreign Banks

Public statements made by senior officials from the People’s Bank of China have put the Gold market at the heart of China’s broader financial reform. China is serious about liberalizing its Gold market and about ensuring their future supplies as they have just granted import licenses to HSBC and ANZ Bank in January. This opens up their domestic Gold market to foreign players. Read more at http://www.mintstategold.com/investor-education/cat/news/post/China_propels_Gold_long-term_growth/

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Rare Coin Report

I have just returned from the Long Beach Coin Expo rare coin convention in California. This convention is a major event for the rare coin community, with thousands of dealers, investors, and collectors attending. The show has a large trading floor with over 300 rare coin dealers. The activity level was the highest that I have seen in the past 10 years. Dealers were aggressively bidding on, and purchasing, a limited amount of high quality U.S. rare coins available.

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2014 CoinStats Now Available

Our numismatic CoinStats report is the best investment tool for rare coin investors. CoinStats is an in-depth statistical analysis of popular rare coin series that allows you to identify the best values in certified rare coins. I am proud to offer this unique and informative tool exclusively to our clients. The January 2014 CoinStats update is now available for $20 Gold Saint Gaudens, $20 Gold Liberties, Morgan & Peace Silver Dollars, and the Walking Liberty Half Dollar series.

The CoinStats Report provides a list of my recommended certified U.S. Gold and Silver coins which are found listed on the Best Value page. These are not the modern issue bullion coins or low-grade circulated coins. These are PCGS/NGC Certified MS63 or higher Gold and Silver U.S. rare coins, dated prior to 1947, that have a proven track record of appreciation and also offer excellent liquidity. To receive the latest CoinStats analysis, just insert CoinStats in the subject line and email me which of the five series you would like to see.

Also for 2014, I am happy to announce that I have increased the CoinStats analysis by adding a new column that shows the increase in the PCGS/NGC population for the past five years. Investors realize the PCGS/NGC population does increase, but comparing the percentage of that increase is an important component in the selection of undervalued Gold and Silver rare coins.

What is surprising? Some of the five year population results in the CoinStats report show that some coins have actually declined in number during that period. How could this happen? There are a number of legitimate reasons that a PCGS and/or NGC certified coins could have a lower population in a five year period.

1. The coin could have been cracked out of its holder and re-submitted, but the owners never sent in the old certificate to the grading service so it could be deducted.
2. The coin could have been upgraded or crossed and the owner never sent in the certificate.
3. Because the new PCGS/NGC Plus grades are not yet incorporated into the CoinStats numbers, the coin may now have a Plus grade. (Plus grades will be added to CoinStats when the quantities increase)

I believe CoinStats is one of the best tools for rare coin collectors and investors to recognize great value and I will continue to look for ways to provide more important information. Your input on CoinStats is always appreciated.

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SILVER

Silver ended trading in January at $19.12 per ounce, down $0.65 for the week and down $0.22 (1.14%) for the month. This is the fifth consecutive month where Silver has closed lower. Silver’s long term major support level has been $18.22 per ounce, and I expect to see short term support for Silver above $19 per ounce.

Demand for physical Silver investment products continues to be strong around the globe. The U.S. Mint reported today that they sold 4,755,000 of 1 ounce Silver Eagles in January; a record number given that it was only for the last two weeks of the month.

The Gold-Silver ratio had a strong month finishing higher at 64.81/1.

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Recommended Investment Commitment and Diversification:

Precious Metal commitment: Minimum of 40% of investment capital

Diversification:  Gold 50%, Silver 45%, Platinum & Palladium 5%

Diversification includes 50% in long term investment quality rare coins and 50% short term bullion products

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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.

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