Gold Seeker Weekly Wrap-Up: Gold and Silver Gain Over 6% on the Week

	Close	Gain/Loss	On Week
Gold	$895.20	+$37.15	+6.43%
Silver	$11.95	+$0.58	+6.60%
XAU	125.94	+8.98%	+10.69%
HUI	304.03	+9.07%	+10.63%
GDM	946.05	+9.10%	+11.24%
JSE Gold	2363.24	+67.75	+7.42%
USD	85.52	+0.03	+1.85%
Euro	129.82	-0.29	-2.43%
Yen	112.58	+0.13	+2.12%
Oil	$46.47	+$2.80	+27.28%
10-Year	2.622%	+0.028	+13.80%
Bond	129.609375	-0.328125	-4.85%
Dow	8077.56	-0.56%	-2.46%
Nasdaq	1477.29	+0.81%	-3.40%
S&P	831.95	+0.54%	-2.14%

Gold traded slightly lower in Asia and rose roughly 1.5% to above $870 in London before it soared even higher in the last few hours of New York trade and ended about 1% off its high of $903.10 with an impressive gain of 4.33%. Silver rose about 2% to above $11.60 in London before it fell to see a loss of 0.99% by about 10:30AM EST in New York, but it then exploded higher in the last few hours of trade and ended about 1% off its high of $12.075 with a gain of 5.1%.

Euro gold rose to a new record high of about €691, platinum gained $29 to $954, and copper gained nearly 8 cents to about $1.46.

Gold and silver equities rose roughly 10% by early afternoon before they pared their gains a bit mid-afternoon, but they then surged back higher into the close and ended with about 9% gains.

There were no major economic reports today. All of this week’s economic reports:

Next week’s economic highlights include Existing Home Sales and Leading Economic Indicators on Monday, Consumer Confidence and the S&P/CaseShiller Composite on Tuesday, a FOMC Rate Decision on Wednesday, Durable Goods Orders, Initial Jobless Claims, and New Home Sales on Thursday, and GDP, Chicago PMI, Michigan Sentiment, and the Employment Cost Index on Friday.

Oil reversed early losses and ended higher on rumors over more OPEC production cuts and on the general rise in nearly all commodities.

The U.S. dollar index reversed early gains driven by weakness in other world currencies and it ended barely higher on worries over the impact of the large stimulus package that is likely to be passed soon.

Treasuries fell slightly as the Dow, Nasdaq, and S&P ended mixed after early losses. While continued economic worries dragged stocks lower in early action, hopes over the stimulus package arriving soon seemed to lift at least the Nasdaq and S&P higher by the close.

Among the big names making news in the market Friday were Pfizer and Wyeth, Xerox, Schlumberger, Google, GE, and Harley.

“Gold is soaring back to the $900 level. A further rally towards $1,000 is possible with momentum and buying interest very strong this week with volatility increasing once again.

Vast misallocation of capital over many years has lead to artificial demand and supply of many goods and services. These large distortions are going through a severe readjustment period which will shock nearly all industries and economies. In the process, losses keep mounting for banks and their leveraged balance sheets will lead to many more becoming insolvent. Investors are looking to shelter their wealth and gold is one of the few choices they have in these unstable markets; wealth preservation is 2009’s theme!”- Peter Spina, www.goldforecaster.com

“With gold running strongly at the moment alongside a strong $, it appears that the strains on the currency market are reaching crisis proportions. The Pound Sterling in particular is falling too far too fast. Will it reach $1: Pound 1 or will Britain impose exchange/Capital controls before then to halt what's left of capital residing in Britain from leaving? Will the Bank of Japan act to halt the rise in the Yen? Will other central banks now be forced to act against exchange rates hurting their economies?

It is this type of uncertainty that is lifting gold. As we have seen record demand for the shares of the gold Exchange Traded Funds, it appears that institutional demand is at the forefront of the present heavy demand for gold. This demand is long-term.”- Julian D.W. Phillips, www.goldforecaster.com

“The battle for Helms-Deep is over; the battle for Middle Earth has begun”!

So says Gandolph the Wizard in the second of Lord of the Rings trilogy, “The Two Towers”.

Gold has beaten back the Orcs and Uruk-Hai to regain the critical $880 level and must now deal with the Ringwraiths (the bullion banks) and Sauron (the monetary lords) as they attempt to defend Mordor (the unbacked paper money system – the root of all economic woes in the global universe). If Frodo can just make it to the fires of Mt. Doom and throw the golden ring of power into the volcanic flow (reintroduce gold into the monetary system), the system will topple freeing the masses from the tyranny of the money masters!

Okay – so it’s a bit melodramatic but gold has smashed through the level which all of the technical studies point to as being the lynchpin of the monetary authorities’ defense – the $880 level. That level marks the upper boundary of the bullish wedge formation I mentioned in yesterday’s commentary as well as the horizontal resistance level which has held it in check since the middle of last December. Bulls were able to take it through this barrage of bullion bank selling who not unexpectedly were attempting to absorb all of the bids and force it back down. The battle could be seen on the 5 minute charts where for a while they were successful at defending their position but a strong wave of buying stormed into the market and effectively routed them out. They were then forced back to $900 where they are regrouping.

Once again gold has defied the action in the Dollar keying off the banking crisis now occurring in Britain as the British Pound disappears into a black hole while the Euro continues to swoon as confidence in the economic fortunes of Euroland disappears like the morning mist. Gold is seeing strong safe haven flows from Europe, which as all the regular readers of this site have known for some time, has generally been the scene of bear raids on gold commencing around the 2:00 AM CST hour. Not so any longer – there is real fear gripping Britain and Europe. Gold has again made yet another all time record high in terms of Sterling at the PM Fix coming in at 641.012 while Euro price gold did indeed set a brand new all time high at the Fix, coming in at €682.420. Euro gold looks like it might be making a run towards €700. At the risk of being repetitive – it certainly appears that a loss of confidence in the European currencies is occurring with the resulting rush into gold being led by European investors. New York is keying off of that as momentum players now move in on the long side.

Overhead resistance now becomes $900 which is near today’s session high followed by more stiff resistance near the $935 - $940 level. Support initially emerges back near $880 and then near the downsloping trendline at the top of the wedge formation which comes in near the $870 level. Oftentimes markets will break up and out of such a formation and then come back down to the broken trendline where they should find buying support and bounce back higher if the breakout is a bona-fide one.

The HUI and the XAU look like they have finalized a divorce from the broader equity markets after their trial separation period which began early this week. The HUI is closing in on former double top resistance near the 310 – 312 level which if it can best that should put it on path to target the general region near 350. The XAU appears to be the stronger looking of the two indices as it closes in on 127, again, a double top that has been in place for the last 5 weeks. A breach of that level and it has a good shot at making a run towards 138 – 140.

I should point out that the major gold ETF, GLD, reported a surge in gold investment demand driving reported tonnage to a new record high of 819 tons. You all know how I feel about that particular entity but nonetheless it still remains a good barometer for gold investment demand.

Keep in mind that this drive higher in gold has been occurring against a backdrop of relatively very low open interest. After making a peak above $1000 last year, open interest in gold reached to almost the 600,000 mark, topping out at 593,953 nearly a year ago to this exact date. Yesterday’s open interest number was a paltry 342,088 or 57.5% of the peak. This comes with gold around $110 or so away from reaching the $1000 level again. Clearly, there is a great deal of room in the paper gold market should momentum players begin returning in size. I would still suggest to some of these managers that they consider standing and taking delivery of some of the gold contracts that they are buying and help pull down the Comex warehouse stocks further. Even so, I wonder what the price might be should another 100,000 new longs move into this market…”- Dan Norcini, More at JSMineset.com

“April Gold closed up 37.2 at 897.7. This was 18.7 up from the low and 2.3 off the high.

March Silver finished up 0.575 at 11.94, 0.01 off the high and 0.39 up from the low.

The gold market started out positive and fell back a couple times in the morning trade, but into mid session prices had managed to reach the highest level since October 10th. In other words, the flight to quality argument seemed to be pumping up gold prices, with some players expressing interest of being long and holding the metal into the weekend. In other words, there is a portion of the trade that continues to expect additional bad news from the credit/banking sector and that seems to have left all of the metals with a positive bias.

The March silver contract managed to reach the highest price level since October 10th and like the gold trade, the silver trade seemed to be playing the flight to quality card rather aggressively. Some players might suggest that the presence of the US stimulus offering from a Senate finance committee on Friday morning added to the upward bias. But given the magnitude of the gains in silver prices, it would seem as if a number of bullish arguments were being pressed into service during the trade.”- The Hightower Report, Futures Analysis and Forecasting

Note: Change in Total Tonnes from yesterday’s data: SPDR added 13.15 tonnes to a new record high holding and the LSE added 0.87 tonnes.

Almaden’s (AAU) corporate update, AngloGold’s (AU) mineral resource increases, Fronteer’s (FRG) bid for Aurora Energy, Abcourt’s (ABI.V) renegotiated option, and MAG Silver’s (MVG) assay result were among the big stories in the gold and silver mining industry making headlines Friday.

Winners & Losers tracks NYSE and AMEX listed gold and silver mining stocks that trade over $1.

Aurora Acknowledges Fronteer Mailing of Take-Over Bid Circular - "There is no immediate urgency for Aurora shareholders to do anything with respect to the Fronteer Offer. The Aurora Board of Directors will communicate further with shareholders prior to the expiry of the Fronteer Offer, including the mailing of a directors' circular to shareholders, so that Aurora shareholders will have updated information in deciding whether or not to tender to the Fronteer Offer. The Special Committee advises Aurora shareholders to defer making any decision with respect to the Fronteer Offer until the Aurora Board of Directors formally communicates its position on the Fronteer Offer." More
- January 23, 2009 | Item | E-mail

Navasota Outlines Bauxite Resources of 343 Million Tonnes Indicated and 63 Million Tonnes Inferred at Koba Project, Guinea - More
- January 23, 2009 | Item | E-mail

Almaden Corporate Update - "Almaden Minerals Ltd. (Toronto:AMM.TO - News)(AMEX:AAU - News) ("Almaden") is pleased to provide the following review of the events and corporate progress the Company has made during 2008. Many milestones were successfully reached and significant steps were taken to ensure the Company has a productive 2009." More
- January 23, 2009 | Item | E-mail

Abcourt has Renegotiated the Aldermac Option - "Mr. Renaud Hinse, president and C.E.O. of Abcourt Mines Inc. (CDNX:ABI.V - News) (Berlin:ABI.BE - News) (Frankfurt:ABI.F - News), is very pleased to announce that the option on the Aldermac property has been renegociated. Considering the actual economic situation, all the payments of $300,000 per year for years 2009 to 2011 in the original option agreement have been postponed for one year and the term of the option was also extended by one year, in consideration of the issue to the Sellers of 375,000 class B shares of Abcourt and 75,000 warrants; one warrant and $0.20 is needed to purchase one class B share of Abcourt within 24 months." More
- January 23, 2009 | Item | E-mail

Lounor drills more gold at Harker - More
- January 23, 2009 | Item | E-mail

GobiMin Inc. Announces a Normal Course Issuer Bid - More
- January 23, 2009 | Item | E-mail

Abitex announces amendments to property option agreements, adopts new stock option plan and grants options - More
- January 23, 2009 | Item | E-mail

Kria Resources Announces Update on Business Combination with Beartooth Platinum - More
- January 23, 2009 | Item | E-mail

Malaga Inc.: Publication schedule for the new NI 43-101 compliant report on the Pasto Bueno property - More
- January 23, 2009 | Item | E-mail

Dia Bras Increases Non-Brokered Private Placement Unit Offering - More
- January 23, 2009 | Item | E-mail

Nuinsco Announces Restructuring of Bridge Loan - More
- January 23, 2009 | Item | E-mail

Dia Bras: Favorable Court Decision on its Bolivar III and IV Mining Concessions - More
- January 23, 2009 | Item | E-mail

Canada regulator orders HudBay vote on Lundin deal - More
- January 23, 2009 | Item | E-mail

HudBay Minerals Inc.: OSC Sets Aside TSX Decision - More
- January 23, 2009 | Item | E-mail

Lundin Mining Corporation: OSC Reverses TSX Decision - More
- January 23, 2009 | Item | E-mail

Grenville Receives Expressions of Interest on Peru Projects - More
- January 23, 2009 | Item | E-mail

Velocity Minerals Ltd.-Final Mt. Haskin Drill Results (Molybdenum) - More
- January 23, 2009 | Item | E-mail

Simberi Announces Private Placement - More
- January 23, 2009 | Item | E-mail

Romios Announces Appointment of New C.F.O. and Grant of Stock Options - More
- January 23, 2009 | Item | E-mail

Castle Gold Reports Increase in Fourth Quarter 2008 Production to 6,928 Ounces Gold, Provides Update on Operating Performance Expectations for 2009 - More
- January 23, 2009 | Item | E-mail

Pure Nickel Reports Fiscal Year-End Results and 2008 Highlights - More
- January 23, 2009 | Item | E-mail

Minera Andes announces fourth quarter gold/silver production increases at the San Jose mine - More
- January 23, 2009 | Item | E-mail

CanAlaska Uranium commences $4.6 million winter exploration program with 13,600 metres of drilling planned - More
- January 23, 2009 | Item | E-mail

Geovic Provides Update on Nkamouna Cobalt Project - More
- January 23, 2009 | Item | E-mail

Noront Encounters More Nickel at Eagle One, as Well as Intriguing Results AT12 Anomaly - More
- January 23, 2009 | Item | E-mail

Pacific Comox Reports 40 Holes for Total of 195 Averaging 1.2 g/t Gold, 42 g/t Silver, 4 Meters Thick, At/Near Surface on Carmelitas Zone, Mabel Property Mexico - More
- January 23, 2009 | Item | E-mail

MAG Silver Reports High Grade Silver/Gold at Valdecanas Vein, Juanicipio Joint Venture - "MAG Silver Corp. (Toronto:MAG.TO - News)(AMEX:MVG - News) ("MAG") has been advised by the operator of the Juanicipio Joint Venture of a new high grade assay result from the final hole in the 2008 definition drilling program along the Valdecanas Vein. Hole JI-08-LE2 reports an intercept of 10.2 metres (7.81 metres true width) grading 1,068 grams per tonne (g/t) (31.1 ounces per ton (opt)) silver, 1.25 g/t gold, 0.69% lead and 3.53% zinc. This includes an internal high grade gold and silver zone with a true width of 3.06 metres running 2,268 g/t (66.1 opt) silver, 2.27 g/t gold, 0.97% lead and 4.19% zinc." More
- January 23, 2009 | Item | E-mail

Fronteer Launches Formal Bid for Aurora Energy Resources Inc. - "Fronteer Development Group Inc. ("Fronteer") (Toronto:FRG.TO - News)(AMEX:FRG - News) announced today that it has filed with securities regulators in Canada and the United States and has commenced the mailing of its formal offer to acquire all of the outstanding common shares (the "Common Shares") of Aurora Energy Resources Inc. ("Aurora") that it does not already own (the "Offer") on the basis of 0.825 of a Fronteer common share for each Common Share held." More
- January 23, 2009 | Item | E-mail

AngloGold Ashanti Mineral Resource Increases at Tropicana - "The Tropicana Gold Project, located 330 kilometres east north-east of Kalgoorlie, is part of the Tropicana Joint Venture, which is 70% owned by AngloGold Ashanti Australia (the manager) and 30% by Independence Group NL.

The Measured, Indicated and Inferred Mineral Resource for the project is now 75.3 million tonnes grading 2.07 grams/tonne for 5.01 million ounces of gold." More
- January 23, 2009 | Item | E-mail

- Would you like to receive the Free Daily Gold Seeker Report in your e-mail? Click here

Note: This article may be reproduced provided the article, in full, is used and mention to Gold-Seeker.com is given.

Disclosure: The owner, editor, writer and publisher and their associates are not responsible for errors or omissions. The author of this report is not a registered financial advisor. Readers should not view this material as offering investment related advice. Gold-Seeker.com has taken precautions to ensure accuracy of information provided. Information collected and presented are from what is perceived as reliable sources, but since the information source(s) are beyond Gold-Seeker.com’s control, no representation or guarantee is made that it is complete or accurate. The reader accepts information on the condition that errors or omissions shall not be made the basis for any claim, demand or cause for action. Past results are not necessarily indicative of future results. Any statements non-factual in nature constitute only current opinions, which are subject to change. Nothing contained herein constitutes a representation by the publisher, nor a solicitation for the purchase or sale of securities & therefore information, nor opinions expressed, shall be construed as a solicitation to buy or sell any stock, futures or options contract mentioned herein. Investors are advised to obtain the advice of a qualified financial & investment advisor before entering any financial transaction.