Gold & Silver Market Morning

Gold Today – The New York gold price closed at $1,339.90 up 70 cents on Monday in New York. Asia saw it rise ahead of London’s opening to $1,342. The gold price was Fixed in London at $1,348.00 up $13.75. In the euro, it Fixed at €973.566 up €12.014 as the dollar stood at $1.3846 slightly stronger. Ahead of the opening in New York gold stood at $1,350.00 and in the euro at €974.66.

Silver Today –The silver price closed at $20.81 down 8 cents in New York. Ahead of New York’s opening, it was trading lower at $21.20.

Gold (very short-term)

Gold will continue to consolidate with a stronger bias, today in New York.

Silver (very short-term)

Silver will consolidate with gold with a stronger bias, today in New York.

Price Drivers

Despite thinner, lackluster trade [except for SPDR gold share buying] in the gold market this week so far, the gold price is holding up and continuing to be moved by arbitrageurs moving gold and silver prices in line with changes in exchange rates between the dollar and the euro. But as the gold price trading range gets tighter and narrower, we expect to see a strong move soon, one way or another as the market gets into balance. Once there it takes only a smaller amount to tip the see-saw one way or another. So be ready!

We will soon be releasing an article that questions just how much gold supply and demand it takes to set the gold price and how much gold is traded outside the price setting markets. This is perhaps the most pertinent question investors should be asking today, if they want to know where gold and silver prices are headed in the future. ! [The article will be published in our newsletters – subscribe - www.GoldForecaster.com and www.SilverForecaster.com and visit www.StockbridgeMgMt.com to hold gold away from potential confiscation]

There were purchases of gold of 7.493 tonnes into the SPDR gold ETF [GLD] but none into the Gold Trust, on Monday, which left their respective holdings at 812.696 tonnes and 165.14 tonnes. These purchases had no impact on the gold price whatsoever. But they do reflect the changing mood towards gold in the U.S. If these purchases continue at these levels, they will have a strong impact on the gold price. Add to this demand the loss of supply from the U.S. and Chinese demand and it is clear that gold supply at these prices will prove insufficient and prices will rise.

From January 2013 the gold market saw persistent selling from the SPDR gold ETF. Then the U.S. banks and their clients, J.P. Morgan Chase and Goldman Sachs launched a 400 tonne ‘bear-raid’ on the market which saw the gold price fall $200. In the last couple of months the gold market has turned up and we see yesterday the sort of SPDR deal size that took the gold price down in early 2013. But this time the market is vulnerable to a ‘bull-raid’ where heavy buyers could force the gold price to jump strongly. We are not saying that will happen, simply that conditions are ripe for such an event.

Silver – The silver price is showing some strength today, telling us the market wants to go higher.

Regards,