Weekly Market Report 11/11/13

This Week’s Headlines:

Gold
The Chinese need to put their Gold somewhere
Silver
October 2013 Silver Institute Newsletter
Baltimore Rare Coin Convention Market Report
Recommended Investment Commitment and Diversification

GOLD

The U.S. Commerce Department made a surprise announcement last Friday saying that 204,000 new jobs were created in October. The amount was substantially higher than the expected 120,000 jobs that had been predicted by many experts. After this announcement, the U.S. Dollar rallied and both Gold and Silver dropped on the expectation that the Federal Reserve (based on this sizeable increase in the employment) would be more likely to reduce their $85 billion monthly stimulus package.

Gold ended the week at $1,288, the lowest close since October 16th, and down $25 per ounce for the week. $1,300 per ounce continues to be the crucial support level. It is very important for Gold to move back above that level in order to stay short term bullish. Today, I am seeing good support at the $1,280 per ounce level.

Last Thursday the ECB announced a ¼ point rate cut in the Euro lending rate, which caused the U.S. Dollar to rally. This U.S. Dollar increase versus the Euro helped drive the Gold price down to $1,296 per ounce. At that point the bulls came in with massive Gold purchases taking the price back to $1,310 per ounce before seeing normal trading volumes. This, combined with the dramatic increase in the U.S. jobs report, were two short term negatives for Gold. Let’s see what this week brings.

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The Chinese need to put their Gold somewhere

A state-of-the-art Gold vault just opened in Shanghai this month. This vault is capable of storing 2,000 metric tons; double China’s projected consumption for this year. The owner of this vault is Malca-Amit Global Ltd., who seeks to benefit from rising demand in Asia’s largest economy. In a recent interview with Joshua Rotbart, the precious metals general manager, he said this facility is the biggest for the Hong Kong-based company and it can also store diamonds, jewelry, and art. Bloomberg calculations show the site could hold bullion worth about $82.7 billion at today’s price, and the World Gold Council forecasts China’s total demand may reach 1,000 tons in 2013.

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SILVER

Silver closed last Friday at $21.32 per ounce, down $0.51 for the week. Silver made two attempts to move above the important $22 per ounce resistance last Wednesday and Thursday, but in both cases was not successful. Silver’s lowest trading price last week was $21.25, at which point there was sizeable demand. Considering that Gold broke below the key $1,300 per ounce level on Friday, Silver has shown excellent support.

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October 2013 Silver Institute Newsletter

The Silver Institute’s October 2013 Silver News Report was just released. The report covers many interesting and exciting benefits that Silver provides. Silver may be the key to Bio-Batteries, Silver demand is growing in the “Slow Photography” movement, and Silver is helping to produce more hydrogen, to name a few.

The complete report is available at http://www.mintstategold.com/SNOct2013.pdf.

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Baltimore Rare Coin Convention Market Report

Last week I was at the Whitman Coin Expo in Baltimore, Maryland. This is the last major coin convention for 2013. The show hosted a record number of 423 dealers with bourse tables on the floor, along with tens of thousands of collectors and coin investors in attendance. I spent Thursday morning through Saturday afternoon on the trading floor looking for client want list coins, as well as any CoinStats recommended U.S. Gold and Silver coins. I was only able to purchase 15 high quality Gold and Silver coins during my entire trip. The investment grade, high quality U.S. coins are just not coming out until we see much higher prices.

I attended the auction during the show and examined many coins, selecting only eight that I was willing to bid on. The auction was very active and I was only able to purchase one of them.

Many of the dealers that I spoke with who specialize in U.S. Gold and Silver rarities were embarrassed by the lack of quality coins that they were able to offer. A few of my friends, long time dealers, discussed with me their frustration with their inability to fill their client’s want lists. They were willing to pay more than current price levels if the coins were available. However, they agreed that we are 2 years into a major bullish cycle for U.S. Gold and Silver rarities and they really want to build up their inventories. History has shown us that the average bull cycle for Gold and Silver U.S. coin rarities can easily run for 6-8 years.

The next major coin show starts on Jan 6, 2014, in Orlando Florida. I will be arriving a few days early attempting to buy some quality coins. In the meantime, I will continue to contact my long time clients hoping that big profits may entice them to sell some of their better coins for a nice profit. I will also stay aggressive on the dealer exchanges and message boards.

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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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