Weekly Market Report 7/29/13

This Week’s Headlines:

Gold
Central banks continue to buy Gold
India’s seizure of smuggled Gold soars 365% in first quarter
Silver
July 2013 CoinStats now available
Recommended Investment Commitment and Diversification

GOLD

Last Monday Gold broke through the $1,300 per ounce resistance level with a passion. This breakout was caused by extraordinary physical demand numbers coming from Asia. Many speculators and technical traders, fearing a reversal of the recent downward price trend, immediately covered their short sales. Gold ended the day at $1,336 per ounce, up $43 per ounce for the day, the highest one day increase in over a year. Demand was very strong and this rally happened in the face of an increase in the value of the U.S. Dollar and lower energy prices.

For the balance of last week Gold never dropped below $1,308 per ounce, trading between $1,308 on the low to $1,348 on the high. Gold closed at $1,321 on the COMEX Friday. Trading volume last week on the world’s commodity markets was heavy, especially for a summer month. I believe that last week’s trading was pivotal and has confirmed that the downtrend in Gold is over, and that Gold has renewed its 12 year bullish uptrend.

I look for Gold to continue to move higher and to break above $1,368 and the $1,400 resistance levels within the next month, and to close above $1,500 per ounce by year end. I am recommending that my clients make additional purchases to increase their Gold holdings immediately.

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Central banks continue to buy Gold

Russia and Kazakhstan have expanded their Gold reserves for a ninth straight month in June. According to International Monetary Fund data, Russian holdings, the seventh largest by country, climbed 0.3 metric tons to 996.4 tons. The IMF data also showed that Kazakhstan’s hoard grew 1.4 tons to 130.9 tons. Hedge funds have also been actively increasing their Gold holdings.

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India’s seizure of smuggled Gold soars 365% in first quarter

The Indian government reports that seizure of smuggled Gold has soared 365% in the first quarter of this year. This follows a curbing of imports of the precious metal to plug a budget trade deficit.

India, the world’s largest buyer of Gold, has twice hiked up import taxes on bullion this year. This is to discourage Gold-buying and has introduced other restrictions on purchases in order to rein in a record current account deficit, the broadest measure of trade. In the April to June quarter of this financial year, seizure of smuggled Gold rose 365% over the same period last year according to the Business Standard newspaper which quoted a government revenue department official.

It is clear that Indian Gold demand will continue to soar regardless of increasing duties and other government restrictions. Indian history has shown that in times of massive trade and budget deficits that are financed with excessive currency printing, the public runs towards Gold to protect themselves from unavoidable inflation.

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SILVER

Silver started last week with a major breakout above the technical $20 per ounce resistance level. Last Monday the Silver price increased $1.05 per ounce, breaking above the $20 resistance level and closing the day at $20.50 per ounce. For the next three days Silver was consolidating at above $20 per ounce. However, last Friday Silver couldn’t hold the key $20 per ounce support level, dropping $0.39 and closing the week at $19.77 per ounce. To say that last Friday’s Silver trading was very disappointing in the face of Gold going above $1,300 per ounce is an understatement.

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July 2013 CoinStats now available

Our numismatic CoinStats quarterly 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 U.S. certified rare coins. I am proud to offer this unique and informative tool exclusively to our clients. The July 2013 CoinStats report is now available for $20 Gold Saint Gaudens, $20 Gold Liberties, Morgan & Peace Silver Dollars, and the Walking Liberty Half Dollar series.

CoinStats 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; they are PCGS/NGC Certified MS63 or higher Gold and Silver U.S. rare coins, dated prior to 1948. These investment quality rarities have a proven track record of appreciation over the past 60 years or longer.

For the latest CoinStats analysis, just put CoinStats in the subject line and email me which series you would like to see.

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Recommended Investment Commitment and Diversification:

Precious Metal commitment: Minimum of 40% 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

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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.

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