Weekly Market Report 3/18/13

This Week’s Headlines:

Hyperinflation booklet
GOLD
Physical demand for Gold up nine-fold in the past five years
Why are the World’s Central Banks replacing Dollars & Euros with Gold?
SILVER
RARE COIN MARKET UPDATE
PLATINUM & PALLADIUM
Recommended Investment Commitment and Diversification

Back to top of report

GOLD

Gold traded between $1,574 and $1,599 all five trading days last week. What we saw was heavy buying every time Gold reached $1,574 per ounce, and technical selling when Gold approached $1,600 per ounce. Last Friday Gold closed at $1,592.60 per ounce, up $15.70 for the week. $1,600 per ounce is a very important resistance level for Gold. With Gold trading at $1,603 per ounce right now, today could be that pivotal day I have been looking for, if Gold can close above $1,600 on heavy volume.

The “Tug of War in the Gold Trading Pits” that I discussed in my March 11, 2013 market report continued last week, but the range has tightened up and selling has lightened up from its earlier levels. The Gold market is looking more and more like it is establishing a major bottom for its next leg higher, which could easily take Gold to $1,700 per ounce before seeing any serious selling.

Back to top of report

Physical demand for Gold up nine-fold in the past five years

According to a major British precious metal retail dealer who operates vaults in London, New York, and Zurich, there has been a nine-fold increase in the number of Gold bullion investors in the past five years since the financial crisis of 2008. Residents of Great Britain are among the most enthusiastic worldwide Gold buyers.

More than 45,000 people have used this dealer to buy physical bullion, and between them they now own 32.9 tonnes of Gold bars and coins, worth £1.11bn ($1.61bn) - 10 times the value of British holdings in their vaults five years ago - with British households accounting for over half that total. Most of these new investors choose to keep their heavyweight investment in Switzerland.

Back to top of report

Why are the World’s Central Banks replacing Dollars and Euros with Gold?

The World Gold Council just released a study on the Diversification Strategies that are being used by Central Banks to move from holding U.S. Dollars and Euros into Gold. I feel that this is well worth reading at
http://www.mintstategold.com/Central_Bank_Diversification_Strategies-WGC_032013.pdf

Back to top of report

SILVER

Silver continued to have a difficult time staying above $29.00 per ounce last week. It had excellent support at $28.50, even though the volume of trading was light. The Silver price isn’t showing the same strength and support as Gold, but I am seeing the same tight spreads and technical selling at resistance levels. On Friday Silver closed at $28.85 per ounce, down $0.10 for the week, and a 55.20-to-1 Silver-to-Gold ratio.

Physical demand for Silver keeps growing. The U.S. Mint reports that 12,578,000 1oz Silver .999 Eagles have been sold in 2013. I expect to see similar type numbers for Canada, Australia, and other countries when they report their 1st quarter sales in April.

Back to top of report

RARE COIN MARKET UPDATE

Last week I went to the Whitman Coin Convention in Baltimore, Maryland. This is the third major coin convention this year. The pattern of increasing investor and collector demand seen at the previous two conventions continues. Many of the dealers at the convention are reporting heavy demand for investment quality certified (PCGS/NGC) U.S. rare coins. I worked the floor from the opening of the show until Saturday, and found a serious lack of quality Gold and Silver U.S. rare coins. I also attended the numismatic auction and found that most of the better coins were actively being bid up to record prices, and in some cases to over 20% higher than previous price levels.

According to a recent report from Knight Frank’s Wealth Report which was released on CNBC-TV, rare coins have increased in value by 25% in 2012, the best of nine main collectible markets that have grown by 175% over the past 10 years. In the past 10 years (2002 to 2012) rare coins were #2 behind classic cars and increasing 248% in value in the past 10 year period. A remarkable return considering that many U.S. rare coins has been unchanged to lower from the financial crises in October 2008 to August 2012. See the complete article at http://www.mintstategold.com/investor-education/what_wealthy_collected/

Back to top of report

PLATINUM & PALLADIUM

Platinum and Palladium both showed minor corrections last week in the face of Gold’s small rally. Platinum closed down $11 per ounce, at $1,592 per ounce, trading without any premium to Gold. Palladium closed at $775 per ounce, down $7 for the week.

Back to top of report

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

Back to top of report

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.

Back to top of page