Weekly Market Report 2/25/13

This week I am really excited to announce that my 2013 Hyperinflation booklet is now complete and has been mailed out to over 2,000 clients. This Hyperinflation study has been totally revised from last years and now contains 40 pages of pictures, charts, and graphs, plus a table of contents that allows you to locate the information that is of special interest to you. In addition to mailing you two copies (one for you and one for a friend), I have posted the PDF on our website. http://www.mintstategold.com/Hyperinflation/

Our Weekly Market Report keeps you current on the latest events happening in the exciting precious metal and rare coin markets. I always welcome your comments.

Thank you,
Barry Stuppler

GOLD 

There was a war in the global Gold trading markets last week. The participants were margin call sellers and technical chart traders, versus the fundamental based long term buyers and global central banks. During the week the Gold price ranged from $1,554 on the low to $1,618 at the high, closing the week at $1,572 per ounce, down $34.50 on record volume. Breaking below the key $1,600 per ounce support level was very short term bearish for Gold.

Right now, I believe that for the short term (next two weeks), I would give Gold a 40% chance of consolidating in the current trading range of $1,554/$1,600.  There is a 15% chance that Gold will reach its long term $1,525 support level. Remember, in 2011 and 2012 Gold tested the long term support four times and held; once each time at $1532 (Sept 2011), $1526 (May 2012), $1533 (May 2012), and $1532 (June 2012). I give it a 5% chance that Gold would break down below $1,525 and test $1,500 per ounce. Lastly, I feel that there is a 40% chance of breaking above the $1,600 per ounce resistance level. A lot depends on what happens in Italy with their elections, and in Washington D.C. on the sequestration issue next week.

Right now, the long term fundamentals for Gold have never looked better:

1. Physical demand from central banks and private investors is at record high levels.
2. Global debasement of paper currencies from monetary stimulus continues.
3. New production of Gold declined 1.4% in 2012 and is projected to continue in 2013.
4. World debt is growing at an unprecedented pace ($16.5 trillion in the U.S.)

The only question I have is, “When will Gold surpass the September 6, 2011 high of $1,920 per ounce?” I think that after 16 months of Gold consolidation, and building a base between $1,525 and $1,750 per ounce, it will happen this year, regardless of what the world’s politicians do.

Is the U.S. Treasury’s NY Fed Gold audit really smoke and mirrors?

The first ever audit by the Treasury’s Inspector General’s Office of the Federal Reserve’s NY vaults containing Gold may be misleading, according to an LA Times story.

Read the complete article at:

http://www.mintstategold.com/investor-education/cat/news/post/is_fed_gold_audit_smoke_and_mirrors/

SILVER 

Silver dropped below the very important $30 per ounce support level last week. After breaking support, Silver selling intensified with margin call selling and technical Silver traders dropping down to $28.25 per ounce. At that point we saw some limited short covering and bargain buying which drove the price back up to $28.88. Then Friday the Silver price traded between $28.30 and $28.85 per ounce, closing at $28.46 per ounce, down $1.40 (4.74%) for the week.

To say that Silver is in a short term bearish trend is an understatement. Silver has support in the $28 to $28.25 price range and major long term support at $26 per ounce. Hopefully, it will hold above the $28 support level and allow new long term buyers to take positions. Recently, Silver has been mirroring Gold’s price action and I do not expect that to change in the short term, therefore I would except to see Silver move back above $29 per ounce if Gold remains stable. 

PLATINUM & PALLADIUM

Platinum and Palladium did not escape last week’s precious metal decline. Although the volume of trading was a fraction of Gold/Silver’s, the market price did drop substantially.

Platinum closed down $70 per ounce, at $1,607 per ounce, still trading at a $34 premium to Gold. Palladium closed at $735 per ounce, down $18 on the week.

Recommended investment commitment and diversification:

Precious Metal commitment: Minimum of 35% of investment capital

Diversification:  Gold 55%, Silver 40%, Platinum & Palladium 5%

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.