Weekly Market Report 05/05/14

This Week’s Headlines:

Gold
N.Y. Federal Reserve holds 1,000 Oz of Gold for Italy that could be Repatriated
Silver
Recommended Investment Commitment and Diversification

GOLD

Last week Gold sold off Monday, Tuesday, Wednesday and Thursday, dropping to $1,283.40, down $17.40 per ounce. Then, on Friday, Gold opened lower, hitting a low of $1,272 per ounce. At that point a news report was released saying that the Ukrainian military was moving to take back a Russian separatist-occupied city in eastern Ukraine. Plus, news of two Ukrainian helicopters being shot down prompted professional commodity traders to buy, covering their short sales. Going into the weekend, traders do not like to be long or short, because Gold is considered too risky. The trading volume last Friday was on the highest of the week, which drove up the price of Gold to a high of $1,304.90. Last week ended with Gold at $1,302.90, up $2.10.

During the past month the primary direction of the price of Gold has been negative. However, the Ukrainian crisis has driven up the price to over the key $1,300 level. What does this mean? If the situation in the Ukraine worsens Gold could test the $1,330 resistance level, otherwise the short term direction is back to $1,280 per ounce.

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N.Y. Federal Reserve holds 1,000 Oz of Gold for Italy that could be Repatriated

Italy’s central bank, the Banca d’Italia, has recently published an important document detailing the storage locations and composition of the country’s Gold reserves. The document confirms that Italy’s Gold is held across four vault locations, three of which are outside Italy.

Banca d’Italia documents show there could be anywhere between 1,000 tonnes and 1,200 tonnes of Italian Gold in the Federal Reserve Bank in New York. The fact that the initial Gold repatriated from New York by the Bundesbank needed seven years to complete, the extended time required indicates that it needs to be melted down and recast (suggesting that it was low grade coin bars). This information does not inspire confidence for the Banca d’Italia who might face a similar problem if it attempts any Gold repatriation from New York Federal Reserve Bank.

For the full story read http://www.mintstategold.com/investor-education/italygoldnyfed/

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SILVER

Silver was also lower the first four days of last week, followed by a $0.50 per ounce rally on Friday. Thursday of last week, Silver made a new 2014 low of $18.69 per ounce. What was very disappointing about setting a new low was that even though Silver rallied back to $19.04 on that day, the trading volume was light. Moving above $20 per ounce is the key for Silver to become bullish again. The last time Silver saw $20 per ounce was back on April 15th.

Silver ended last week at $19.54, down $0.15 per ounce. The Silver to Gold Ratio is now at 66.66 to one.

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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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