Weekly Market Report 7/20/15

| July 20 2015

Links to recent informative articles on precious metals and rare coins:

U.S. Mint temporarily suspends sales of American Silver Eagles

This Week’s Headlines:

Gold
Fundamentals for a higher Gold price continue to strengthen
Silver
Platinum
US Mint announced 2015 High Relief Gold coin
July 2015 CoinStats is now available
Recommended Investment Commitment and Diversification

GOLD

Last Friday Gold closed at $1,131.90, down $26 for the week and $40 since the beginning of the month. $1,131.90 is the lowest the Gold price has been since April 1, 2010. Gold has now been down seven trading days in a row on excellent CME trading volume.

Since reaching an all-time high of $1,920 per ounce on Sept. 6, 2011 Gold has been in a down trend. Gold rallied from $276.50 on December 31, 2001 to reach $1,920 over ten years later, an increase of almost 600%. $1,100 per ounce would be a 50% retracement of the long term rally and a major support level for Gold.

Long term Gold investors (3 years or more) should seriously consider adding to their Gold holdings right now. The risk/reward level for Gold ownership has never been more attractive. Plus, due to the strong U.S. Dollar versus the Euro, premiums on the very popular European Pre-1933 Gold bullion coins are also at five year lows.

Last week’s news about the Greek bailout and the Iranian nuclear arms agreement were major factors that negatively affected precious metals. This news also resulted in a stronger U.S. Dollar, which hit a recent high of $1.07 versus the Euro.

Gold was also negatively affected last week by the Chinese announcement about their Gold reserves. The news that China’s Gold reserves have increased only 604 metric tonnes since 2009 was very disappointing to Gold market watchers. Although the Chinese Gold reserve surge represented a 57% increase, many analysts were dissatisfied. Many precious metal professionals were expecting an increase of 2,500 metric tonnes in China’s Gold reserves. For more details please read the article at:
http://www.mintstategold.com/investor-education/cat/news/post/china_gold_hoard_mystery/

Today in early Asian trading, half-an-hour after the Shanghai Gold exchange market opened, someone sold 5 tonnes of Gold into this lightly traded market. This sale is way above normal trading volumes and quickly drove the price down to $1,080 per ounce before serious demand appeared, driving the price back over $1,100 per ounce very quickly. This sale was not a result of any news or fundamentals.

Robin Bhar, chief analyst for French banking giant Societe Generale, said, "Illiquidity was important in the Asian overnight move, with other countries on holiday ... it was just a bit of a bear raid and there was nobody on the other side to mop up the selling." More than 3 million lots traded on the primary futures contract on the Shanghai Gold Exchange, compared with the volume for July which averaged fewer than 30,000 lots. Traders said it appeared that sellers had taken advantage of a low-liquidity environment, with Japanese markets closed for a public holiday fueling speculative selling.

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Fundamentals for a higher Gold price continue to strengthen

While some financial institutions are still calling for Gold to reach $1,000 per ounce, I continue to believe we have seen the bottom of the market and that the price of Gold will move above the current $1,220 resistance level, and go much higher, very soon. The fundamentals for a major increase in the Gold price remain strong. Remember, last year Gold was up in every major currency except the U.S. Dollar.

Why will Gold move higher in all major world currencies? Let me share some of the reasons:

Major military and political problems in the Middle East.
Worldwide quantitative easing (money printing), especially in China, Japan, and Europe.
The Greek $90 billion bailout will set the criteria for a bailout for Spain and Italy. This will result in the ECU printing a lot more Euro’s.
Central Banks continue to trade their U.S. Dollars for Gold, thus building their Gold reserves.
Extraordinary physical demand for Gold and Silver investment products in Asia and Europe.
Global Gold production is dropping as cost of mining increases.
Interest rates have reached historical lows worldwide.

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SILVER

Last week, Silver declined with Gold, down all five trading days. Silver reached a low of $14.80 per ounce on Friday, above last week’s 2015 low of $14.62 per ounce. Silver closed the week at $14.83 per ounce, down $0.65 for the week. Last week, CME trading volume was less than the week before, not surprising as Silver tries to consolidate at current price levels while establishing a new trading range. Silver has excellent demand and price support at $14.16 per ounce, the 2014 low. This low could be tested again if Gold sells off this week.

The U.S. Mint has temporarily stopped selling Silver Eagles. This happens from time to time and the premium over spot increases due to the immediate shortage. Please don’t over-react; just wait for the U.S. Mint to start delivering Silver Eagles again, probably later this month or early August.

Today, unlike Gold, Silver did not reach a new low price this morning. The Silver price usually moves in tandem with the Gold price, but that didn’t happen this morning. Silver did reach a low of $14.54, but there wasn’t any serious selling in the Asian markets.

The Silver/Gold ratio moved to an amazing 76.30-to-1.

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PLATINUM

For most of 2015, the spot price of Platinum has traded at a discount to the Gold spot price. This has only happened four times in the past ten years, and Platinum rarely stays at a discount to Gold for more than six months. Platinum closed last week at $1,001 per ounce, and 1oz Platinum Maple Leafs are trading at an amazing $91 discount to the 1oz Gold Maple Leafs. The Canadian Platinum Maple Leaf is the best bullion coin on the market, with the lowest premium over spot Platinum.

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US Mint announced 2015 High Relief Gold coin

The U.S. Mint has announced that it will be minting a 2015 High Relief Gold coin. The U.S. Gold coin will have a denomination of $100 and contain one troy ounce of .9999 24-Karat Gold. It will have a lustrous high relief surface, and a classic American Gold coin design. The mintage is limited to 50,000 from the West Point Mint. This is the first High Relief Gold coin since the 2009 Ultra High Relief, which will increase in demand once the 2015 is released. The 2015 High Relief will be released on July 30, 2015.

We will be offering the 2015 High Relief for pre-sale on our website as soon as possible. We will also be offering them for pre-sale in MS70 First Strikes from PCGS and MS70 Early Releases from NGC, with an estimated delivery for the MS70s of approximately August 30, 2015. We will be notifying all of our customers when our 2015 High Relief pre-sale offer is available.

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July 2015 CoinStats is 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. CoinStats has been updated for July 2015 and is now available. Six different series are available: $20 Gold Saint Gaudens, $20 Gold Liberties, $10 Indians, Morgan & Peace Silver Dollars, and the Walking Liberty Half Dollars.

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 1948, which have a proven track record of appreciation and also offer excellent liquidity. To receive the latest CoinStats analysis, just insert the word CoinStats in the subject line and email me which of the six series you would like to see.

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Recommended Investment Commitment and Diversification:

Precious Metal commitment: Minimum of 45% of investment capital

Diversification: Gold 45%, Silver 45%, Platinum & Palladium 10%

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

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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.

Categories: Weekly Market Report