Gold and Silver Market Morning: Feb 24 2017 - Gold overcoming $1,250 resistance!

Gold Today–New York closed at $1,248.80 on the 23^rd February after closing at $1,238.10 on the 22^nd February.London opened at $1,254.00 today.

Overall the dollar was weaker against global currencies early today. Before London’s opening:

 -The $: € was weaker at $1.0589: €1 from $1.0545: €1 on yesterday.

-The Dollar index was weaker at 100.95 from 101.36 on yesterday.

-The Yen was stronger at 112.85:$1 from yesterday’s 113.20 against the dollar. 

-The Yuan was stronger at 6.8717: $1, from 6.8786: $1, yesterday. 

-The Pound Sterling was stronger at $1.2553: £1 from yesterday’s $1.2477: £1.

Yuan Gold Fix

Please note that the Shanghai Fixes are for 1 gm of gold. From the Middle East eastward metric measurements are used against 0.9999 quality gold.[Please note that the 0.5% difference in price can be accounted for by the higher quality of Shanghai’s gold on which their gold price is based over London’s ‘good delivery’ standard of 0.995.]

At the close in Shanghai today, the gold price was trading at 279.50 Yuan, which directly translates into $1,265.10. But allowing for the difference of gold being traded this equates to a price of $1,261.10. This is $8 higher than the New York close and $7 higher than London.

Bearing in mind that the prices of the 23^rd [yesterday] above are the prices ahead of London’s opening and well ahead of New York’s opening. As you can see both London and New York were dragged higher by Shanghai. Looking at Shanghai’s closing prices today [not on the chart as they have not yet been officially released, we are looking at prices over $1,260. If London and New York continue to follow Shanghai, which we believe will happen, then both London and New York will see good rises later today.

LBMA price setting:The LBMA gold price was set today at $1,255.35 up from yesterday’s $1,237.35.

The gold price in the euro was set higher at €1,185.02 after yesterday’s €1,172.40.

Ahead of the opening of New Yorkthe gold price was trading at $1,257 80 and in the euro at €1,186.16.  At the same time, the silver price was trading at $18.30.

Silver Today –Silver closed at $18.18 at New York’s close yesterday against $18.04 on the 22^nd February.

Gold_{(very short-term)} The gold price will be stronger if gold holds above $1,250, in New York today.      

Silver_{(very short-term)} The silver price will be stronger if gold holds above $1,250, in New York today.

Price Drivers

The media will continue to attribute rises in the gold price to events in the U.S. with an occasional nod towards gold ETF buying. But today we see there was no purchases into the U.S. based gold ETFs. The dollar weakened against most currencies, but even in the euro against which the dollar is most often measured, the gold price rose almost the same as it did in the dollar. So, today is a day when the gold price has risen against all currencies, with Shanghai leading the way! This pattern, now that the slowdown in Chinese demand due to the Lunar New Year is out of the way, seems to be taking hold of the gold markets.

It is a structural change in the global gold markets and appears to us that effective arbitraging [dealing between two markets] has become efficient. Banks that are permitted to take gold into China must be active in doing this but the main player has to be the ICBC which is a member of the price setting committee and a ‘market maker’ in London with their vaults, in total, accommodating 3,500 tonnes of gold for clients and itself.

Gold ETFs –Yesterday saw no sales or purchases from or into the SPDR gold ETF or the Gold Trust.Their respective holdings are now at 841.169 tonnes and 201.82 tonnes. 

Since January 4^th 2016, 242.379 tonnes of gold have been added to the SPDR gold ETF and to the Gold Trust.  Since January 6^th 2017 32.298 tonnes have been added to the SPDR gold ETF and the Gold Trust.

Regards,

Julian D.W. Phillips 

GoldForecaster.com|SilverForecaster.com|StockBridge Management AllianceTo ensure you can benefit from the future higher gold prices we will see then, you need to hold it in a manner that makes sure it can’t be taken from you. Contact us at admin@stockbridgemgmt.com to buy physical gold in a way that we feel, removes the threat of it being confiscated. We’re the only storage company that offers that!

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