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Precious Metals Review

Market information and news is critical for precious metal investing. However, many investors have limited time to sort through the massive amounts of market data and gold, silver and platinum news. The Monex Precious Metals Review consolidates the week's activities in a concise snapshot of the precious metal markets.

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PRECIOUS METALS REVIEW - APRIL 29, 2016

In the precious metals markets this week . . .  

GOLD:
Monex spot gold prices opened the week at $1,237 . . . traded as high as $1,298 on Friday and as low as $1,232 on Tuesday . . . and the Monex AM settlement price on Friday was $1,290, up $53 for the week.  Gold support is now anticipated at $1,285, then $1,238, and then $1,195 . . . with resistance anticipated at $1,307, then $1,340, and then $1,381.

SILVER:
Monex spot silver prices opened the week at $17.01 . . . traded as high as $17.97 on Friday and as low as $16.92 on Tuesday . . . and the Monex AM settlement price on Friday was $17.79, up $.78 for the week.  Silver support is now anticipated at $17.77, then $17.52, and then $17.17 . . . and resistance anticipated at $17.97, then $18.32, and then $18.51.

PLATINUM:
Monex spot platinum prices opened the week at $1,011 . . . traded as high as $1,082 on Friday and as low as $1,003 on Tuesday . . . and the Monex AM settlement price on Friday was $1,075, up $64 for the week.  Platinum support is now anticipated at $1,058, then $1,015, and then $981 . . . and resistance anticipated at $1,083, then $1,108, and then $1,141.

PALLADIUM:
Monex spot palladium prices opened the week at $601 . . . traded as high as $636 on Friday and as low as $594 on Tuesday . . . and the Monex AM settlement price on Friday was $627, up $26 for the week.  Palladium support is now anticipated at $621, then $588, and then $555 . . . and resistance anticipated at $645, then $676, and then $698.

QUOTES OF THE WEEK:

From James Grant, in the cover story in the April 25th issue of Time magazine:

''Dollars aren't so much minted these days.  Rather, they issue from the Fed's computers in billowing digital clouds.  The cost of producing them is only the energy expended on tapping the keys.  The Fed emits these electronic greenbacks to attempt to control the course of economic events.  It's a heaven-sent monetary system for a big-spending government.''

''Periodically, the buzz wears off.  What remains is a hangover of debts and promises.  The proliferating dollars facilitate heavy borrowing.  Ultra-low interest rates mask the cost.

I don't ask that we return to some long-lost fiscal and monetary Eden.  None has ever existed, even in America.  Crises and business cycles are always with us.  I merely observe that sound money and a balanced budget were two sides of the coin of American prosperity.''

''Between the fiscal years 2008 and 2012 alone, federal deficits totaled $5.6 trillion.  The public debt nearly doubled in the same span of years, to $11.2 trillion.  The Federal Reserve tickled $1.6 trillion in new digital dollars into existence.  True, our Great Recession proved no Great Depression, but the post-2008 recovery is the limpest on record.''

''We always need protection against cockeyed economic experimentation.  Once a national consensus on money and debt furnished this protective armor.  Money was gold and debt was bad, Americans assumed.  Most credentialed economists today will smile at these ancient prejudices.  Allow me to suggest that our forebears knew something.''

. . . and from Fergal O'Brien and Catherine Bosley, in a posting on the Bloomberg website on April 26th:

''Nobel-prize winner Joseph Stiglitz said monetary policies have exacerbated inequality and need to be redirected to better target getting money flowing into economies and helping small and medium-size businesses.''

'' 'The key problem is the access of credit to small and medium-size enterprises, is getting that flow of money into the real economy,' Stiglitz said.  It's 'nice to have a stock market bubble if you have a lot of stock.  But if you are in the bottom 80 percent of America, you have a little stock and you can feel a little good about the stock going up.  But let's face it, the overwhelming bulk of our stock market is owned by the 1 percent.'

Stiglitz's comments come as some central banks around the world are being forced to delve deeper into their policy tools to help support their economies.  As policy makers struggle to find a way out of the economic malaise, some have even raised the idea of helicopter money, which aims to direct cash straight to consumers.''

''The dangers of negative interest rates -- if you don't manage it extraordinarily well; some countries are doing it reasonably well, some are not -- is that it actually weakens the banking system,' he said.  'If it weakens the banking system, the banks are going to provide even less credit.  While it might have some effect on financial markets, in terms of what we really should be concerned about, which is the flow of credit to businesses, that's not working.' ''

. . . and from Michael Brush, in a posting on the MarketWatch website on April 27th:

''If you missed the nice run in gold so far this year, here's a way to make up for lost ground.

Buy platinum.

Platinum has already crushed gold in 2016, advancing about 22% vs. 17% for gold.

This trend is likely to continue for a simple reason.  Historically, platinum often sells for about 1.5 times the value of gold per ounce.  Recently, though, it's sold for about 80% the price of gold.

This discount may well continue to close -- as it has so far this year -- and then revert to a premium.  As this happens, platinum will keep outperforming gold.''

''Unlike gold, platinum is used pretty extensively in industry.  This could help explain the unusual discount to gold.  After all, many investors remain fearful that the global economy and manufacturing are going to sink into recession.  Others worry that China's growth is not all it's cracked up to be.

But what if they're wrong and Chinese and global growth pick up?  Then platinum demand will improve, driving prices higher.  U.S. Global Investors CEO Frank Holmes expects improved growth in China.  He thinks job growth in China will boost demand for cars, which will spark demand for platinum.''

. . . and from Jan Harvey, in a posting on the Reuters website on April 28th:

''Silver may yet have more upside than gold after lagging the yellow metal in the first quarter.  The ratio of the two metals reached its highest since 2008 in February, but has dropped sharply back as silver rallied this month.

'The gold/silver ratio has risen significantly over the past few years,' Stephen Walker, analyst at RBC Capital Markets, said.  'We believe that over the longer term, this multiple should contract and regress towards the mean.' ''

''Increased investor interest has been driven by a perception that the metal had become undervalued compared to gold, analysts said, and could benefit along with industrial metals from a recovery in the global economy.

'Later in the year we forecast silver will eventually catch up with gold, helped by bargain hunting purchases and improving industrial commodity prices,' Metals Focus analyst Nikos Kavalis said.''

. . . and from Stephanie Yang, in a posting on the Wall Street Journal website on April 29th:

''Gold prices rose to their highest level in 15-months Friday, boosted by a weaker U.S. dollar and heightened demand for safe-haven assets.''

''Friday's move also marks the biggest one-day gain since March 17, when gold rose 2.9%.''

''The dollar has fallen 2% this week, as the Federal Reserve signaled it would be slow to raise interest rates this year.  On Thursday, the Bank of Japan left monetary policy unchanged, which led to a surge in the Japanese yen against the dollar.

Weak economic data has also helped to support gold.  On Thursday, the Commerce Department said U.S. gross domestic product rose 0.5% in the first quarter, marking its worst performance in two years.  Corporate profits, manufacturing and consumer confidence have also come in with dismal numbers this month.''

Last update: Apr 29, 2016 11:27:45 AM

This is not a recommendation to buy or sell.