Gold & Silver Market Morning: May 30, 2014

Gold Today – The gold price closed at $1,255.00 up $1.00 on Thursday, in New York. In Asia and London the price vacillated between $1,257 and $1,252 until the Fixed, where it was set at $1,254.00, once again and in the euro at €921.043, yet again, while the euro stood at $1.3615. Ahead of the opening in New York the gold price was trading at $1,255.30 and in the euro at €922.13.

Silver Today – The silver price closed at $18.99 down 6 cents, in New York. Ahead of New York, silver was trading at $19.02.

Gold _{(very short-term)}

The gold price should consolidate, in New York today.

Silver _{(very short-term)}

The silver price is should consolidate with, in New York today.

Price Drivers

Again no further sales from the gold ETF and the week until now showing a rise of over 8 tonnes, but the gold price is looking fragile, despite its consolidating on support in the mid $1,250’s. Their holdings are at 785.279 tonnes in the SPDR gold ETF and at 163.41 down a paltry 0.61 of a tonnes in the Gold Trust.

The Technical picture is poor short-term and Chinese demand, while down on this time last year is looking stronger than seen in previous years.

There are reports out there that say that there is a gold deficit of around 4.35 tonnes a week, meaning that more gold is being bought than produced. That’s why the SPDR sales are important if the gold price is to be held at current levels. This makes the fall this week even more difficult to understand. The lack of visible physical sales of gold from speculators and the investors, tells us that there is very little momentum behind the downward path of gold and it can turn around in a heartbeat. We therefore attribute the fall to a temporary drop in demand due to wholesalers looking for lower prices. But they can only do this for a short while.

Today is the day when options are settled or rolled over into the next month. Usually this marks the low point for gold prices for the month. Let’s call it the “Plunkett Point”?

The euro is steady at $1.36 but capable of falling further ahead of the E.C.B. announcements in June.

Next week sees the threat by Russia to the Ukraine to cut supplies of gas unless paid in advance for its gas, come to fruition or not. If supplies are cut the gas situation in Europe becomes tenuous.

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Silver – The silver price is consolidating around $19. [More in the www.SilverForecaster.com]

Regards,

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