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.
PRECIOUS METALS REVIEW - MAY 17, 2013
In the precious metals markets this week . . .
Monex spot gold prices opened the week at $1,431 . . . traded as high as $1,437 on Tuesday and as low as $1,360 on Friday . . . and the Monex AM settlement price on Friday was $1,366, down $65 for the week. Gold support is now anticipated at $1,361, then $1,329, and then $1,285 . . . with resistance anticipated at $1,407, then $1,448, and then $1,484.
Monex spot silver prices opened the week at $23.62 . . . traded as high as $23.78 on Monday and as low as $22.18 on Friday . . . and the Monex AM settlement price on Friday was $22.34, down $1.28 for the week. Silver support is now anticipated at $22.10, then $21.31, and then $20.65 . . . and resistance anticipated at $22.53, then $23.47, and then $24.26.
Monex spot platinum prices opened the week at $1,482 . . . traded as high as $1,509 on Tuesday and as low as $1,453 on Friday . . . and the Monex AM settlement price on Friday was $1,463, down $19 for the week. Platinum support is now anticipated at $1,451, then $1,417, and then $1,375 . . . and resistance anticipated at $1,515, then $1,558, and then $1,598.
Monex spot palladium prices opened the week at $704 . . . traded as high as $742 on Thursday and Friday and as low as $704 on Monday . . . and the Monex AM settlement price on Friday was $740, up $36 for the week. Palladium support is now anticipated at $734, then $716, and then $701 . . . and resistance anticipated at $740, then $758, then $788, and then $825.
QUOTES OF THE WEEK:
From Richard Russell, editor of Dow Theory Letters, in remarks posted on his website on May 13th:
''We are living in amazing times. These are times that have ushered in unprecedented events. For instance, did you know that the Dow has risen on 21 of the last 25 weeks? On top of that, borrowing (margin debt) is at a near-record high of $346 billion (the record was $381 billion in July, 2007). Never before has there been so little cash in money market funds relative to stocks and bonds. Last week the yield on Barclays US high yield index fell to a record low 4.97%, the first time it has ever fallen below 5%.
The whole situation can be described in one sentence -- the search for yield has reached almost insane levels. The question -- have investors driven certain assets to extremes in height, and have they placed various markets on dangerously thin ice? Are we looking at a collection of new Fed-created super-bubbles?
What's the Russell advice? My average subscriber is not a money manager. Therefore, my average subscriber's job does not depend on his producing income or even profits. My preference is to sit with cash and gold.''
. . . and from widely-followed gold market expert Jim Sinclair, in comments posted on his website (Link) on May 15th:
''Legacy OTC derivatives still overhang and threaten the financial system. They, by the nature of their construction, never go or fade away. They simply float in cyber space without funding as special performance contracts that have no chance of performing.
The entire impetus behind all the hustle in central banks of late is the legacy OTC derivatives. Financial institutions internationally still have them and they are not valued by any market because there is no market.
If legacy OTC derivatives were adjusted to real value, it would be like the Black Plague in the financial world. That is the root of all the manipulations of every market on the planet.
This is the reason and only reason for QE. This is the event that must not happen.''
. . . and from Mike Cosgrove, in an editorial on the ''Issues & Insights'' page of Investor's Business Daily on May 16th:
''The Treasury portion of QE3, buying $45 billion a month, effectively purchases over half the Treasury debt issuance this year. Is that why the Fed implemented it? To try and keep longer-term bond yields low to hold down the cost of financing the $16 trillion debt burden?
That is how it looks -- the Fed is effectively monetizing the issuance of Treasury debt.
Is it any wonder banks, households and businesses are holding large amounts of cash and cash equivalents?
This monetizing of federal debt allows the White House and Congress to cheaply add nearly a trillion dollars to outstanding Treasury debt this year.
The Federal Reserve policy of buying $85 billion of debt in the fourth year of recovery is enhancing Main Street's perception that central bank officials have turned into an arm of the administration.''
. . . and from Bill Bonner, well-known author and founder of Agora Inc. and Agora Financial, in an article on Agora's The Daily Reckoning website, posted on May 16th:
''Stock market investors don't seem to know or care that the main thing propping up their investments is the same thing that will ultimately destroy them. And that the longer the situation continues, the bigger the mess will be when it finally blows up.
We're talking, of course, about Fed, Bank of England, Bank of Japan and People's Bank of China monetary policy. It is 'experimental.' It is 'bold.' It is also reckless and potentially catastrophic.
Lending money at negative real interest rates creates grotesque distortions in the market.
Savers get nothing for their trouble. In fact, they lose money in real (inflation-adjusted) terms. So they shift to speculating on stocks. The stock market goes higher . . . but it is not a market you can trust.
It is being driven by the printing of trillions of dollars, yen, pounds and renminbi. But central bank policy hasn't been able to budge slumping economic fundamentals. And any attempted exit by central banks in the absence of a genuine economic recovery will be, in the words of hedge fund manager Paul Singer, 'somewhere on the continuum between problematic and impossible.' ''
. . . and from Mary Anne and Pamela Aden, editors of The Aden Forecast, in the May issue of their newsletter, released this week:
''It's already been a month since gold fell almost $200 in two trading days. This head-spinning drop damaged the bull market. It broke the back of a STRONG market, but that doesn't necessarily mean the mega uptrend is over.''
''As of the mid-April low, gold is down about 19% for the year. If gold ends the year near these low levels, it'll be the first time in 12 years gold has had a down year. Assuming this happens, the 660% rise from 2001 to 2011 would be down about 28% from the peak, which isn't bad in perspective.
During the last 12 years, gold rose without inflation, with a war on terror, during the worst financial crisis in decades, through an unprecedented debt build up and during years of economic sluggishness.
This time period also saw the U.S. dollar decline amid growing doubts of its reserve currency status. And it's been a time when many countries have protected themselves from uncertainty by buying the most gold in 50 years. That's because our present economic situation is nearly unparalleled in U.S. history.''
''Currently, the bull is wounded but it will recover. In the meantime, gold and silver have strong support at $1320 and $20, respectively.''
Last update: May 17, 2013 11:34:51 AM
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