New York closed Thursday at $1,637.10 and slipped in Asia and London to $1,633 ahead of London’s opening. The euro was slightly stronger at €1: $1.3141. Gold Fixed it at $1,629.50 down $13 and in the euro at €1,240.201 down €11.5, while the euro stood at €1: $1.31239. Ahead of New York’s opening it stood at $1,628.25 and in the euro €1,239.95 while the euro was at €1: $1.3131. Silver was$30.19 at the close in New York but opened in London at $30.19. Ahead of New York’s opening it stood at $29.81.

Gold _{(very short-term)}

Gold’s trading range today could go either way without giving clear direction, today in New York.

Silver _{(very short-term)}

Silver’s trading range could go either way without giving clear direction, in New York today.

Price Drivers

Another down day for gold as traders feel a soft tone in gold and silver prices.

On the silver price its falls have been greater than we have seen in the gold price, as it breaks down through the $30 level. Is this a reflection of its industrial demand? No. Its price is driven by traders and investors in the Silver Trust. Traders are by far the greatest influence over the price and they have a rock solid belief that silver should move with the gold price. The recent past has shown silver to have much more resilience on the downside movements than gold and to display much more vigor on the upside.

Bear in mind that the industrial applications for silver have moved from a focus on discretionary spending that photography represented to more needed applications in the electronic and medical fields. This makes such demand more robust in a downturn. We don’t see this demand diminishing in the near future.

Will it collapse if gold drops? No, we think not. Asian investment demand has grown as the gold price has risen because silver is an alternative to gold there and more affordable to a much wider, poorer market. However, it will be still be driven by traders in the short-term and its price will reflect day-to-day sentiment.

Traders have managed to link the gold price to the state of the U.S. economy and will continue to do so for the immediate future.

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Regards,

Julian D.W. Phillips for the Gold & Silver Forecasters