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Gold Seeker Weekly Wrap-Up: Gold and Silver Gain Almost 2% and 8% on the Week

By: Chris Mullen, Gold-Seeker.com



-- Posted 27 May, 2011 | |

Please Note: US Markets are closed on Monday in observance of Memorial Day.

 

 

Close

Gain/Loss

On Week

Gold

$1535.80

+$13.60

+1.76%

Silver

$37.88

+$0.53

+7.98%

XAU

208.47

+1.47%

+4.61%

HUI

550.38

+1.52%

+3.90%

GDM

1605.48

+1.42%

+3.67%

JSE Gold

2600.99

+22.82

+1.74%

USD

74.92

-0.67

-0.94%

Euro

142.84

+1.45

+0.96%

Yen

123.69

+0.74

+1.09%

Oil

$100.59

+$0.36

+1.11%

10-Year

3.064%

+0.003

-2.79%

Bond

125.84375

-0.125

+0.80%

Dow

12441.58

+0.31%

-0.56%

Nasdaq

2796.86

+0.50%

-0.23%

S&P

1331.10

+0.41%

-0.16%

 
 

 

The Metals:

 

Gold traded mostly slightly higher in Asia and London before it accelerated higher in New York and ended near its late session high of $1538.37 with a gain of 0.89%.  Silver surged to as high as $38.18 by midmorning in New York before it fell back off a bit into the close, but it still ended with a gain of 1.42%.

 

Euro gold remained at about €1078, platinum gained $24.50 to $1795.00, and copper gained another 7 cents to about $4.18.

 

Gold and silver equities rose about 1.5% at the open and remained near that level for the rest of the day.

 

The Economy:

 

Report

For

Reading

Expected

Previous

Personal Income

Apr

0.4%

0.4%

0.4%

Personal Spending

Apr

0.4%

0.5%

0.5%

PCE Prices - Core

Apr

0.2%

0.2%

0.1%

Michigan Sentiment

May

74.3

72.4

72.4

Pending Home Sales

Apr

-11.6%

-1.4%

3.6%

 

All of this week’s other economic reports:

 

GDP - Q1

1.8% v. 1.8%

 

GDP Deflator - Q1

1.9% v. 1.9%

 

Initial Claims - 5/21

424K v. 414K

 

FHFA Housing Price Index - March

0.3% v. -1.5%

 

Durable Orders - April

-3.6% v. 4.4%

 

Durable Orders ex trans. - April

-1.5% v. 2.5%

 

MBA Mortgage Index - 5/20

1.1% v. 7.8%

 

New Home Sales - April

323K v. 301K

 

Next week’s economic highlights include the Case-Shiller 20-city Index, Chicago PMI, and Consumer Confidence on Tuesday, ADP Employment, Construction Spending, and the ISM Index on Wednesday, Initial Jobless Claims, Productivity, Unit Labor Costs, and Factory Orders on Thursday, and May’s jobs data and ISM Services on Friday.

 

The Markets:

 

Charts Courtesy of http://finance.yahoo.com/

 

Oil ended slightly higher on worries over fighting in Libya and anti-government protests throughout the Middle East.

 

The U.S. dollar index fell on more poor housing data that suggests the fed may hold off longer before raising interest rates.

 

Treasuries fell as the Dow, Nasdaq, and S&P rose on the better than expected consumer confidence reading.

 

Among the big names making news in the market Friday were Google, EBay, PayPal, CVS, and Medco.

 

The Commentary:

 

Please note several aspects about the gold chart.

 

Fist of all, from a trend following perspective, it is trading above all the major moving averages once again. That tells us that the chart is bullish. Secondly, the 10 day moving average (blue line), which had been moving down until last Friday, has now turned up and is trending higher. It is also getting ready to make a bullish upside crossover of the 20 day moving average (red line). That will be bullish as well.

 

Also note that the market held above the 40 day moving average (dotted line) even on its setback in price, failing to close BELOW that level once. That means that the trend following funds were still active and were buying the dip or retracement in price.

 

The MACD, a good trend following indicator, is bullish.

 

Based on what I can see here, gold looks as if it wants to make a try at $1550, one of those even numbered levels that takes on a technical significance as price approaches it. It is important to note that this is occurring late in May, a time frame during which gold tends to show seasonal weakness. This seasonal weakness however can be attributed to factors, which while important, are not what are driving gold at this time. The festival seasons from Asia and India are over and the strong jewelry related demand is therefore missing. However, gold is not deriving the bulk of its strength from that source but rather from currency related matters.

 

By currency related matters I mean investor concerns over the stability of paper currencies due to the tremendous amount of debt being run up by so many nations. European sovereign debt woes remain a strong source of gold related buying, especially from investors on the Continent. This is reflected in the very strong gold price in terms of the Euro and of the British Pound. As you know, Euro priced gold set a new record high this week.

 

Here in the US, our total federal debt level is at 100% of GDP. We are looking at entitlement programs which will be bankrupt within less than a decade on the current trajectory. Many states are in precarious financial condition which large numbers of municipalities and counties facing their own set of problems. Much of this is tied to the collapse in real estate values and thus affects valuations which are a source of property tax revenues. News on the housing market continues to reflect a sector that is mired in a supply glut at a time when demand is feeble. That is not a recipe for improving valuations anytime in the immediate future.

 

Ever since Fed governor Bullard let the cat out of the bag and basically told the market that the Fed would not be withdrawing accommodative monetary policy until at least July 2012, the Dollar has been moving steadily lower. That keeps REAL INTEREST rate yields negative and has strengthened the conviction in many traders’ minds that such an environment is going to be the norm for at least another year. Gold LOVES those kinds of conditions and thus has moved steadily higher ever since Bullard’s comments.

 

While it may dip in price moving forward, as long as this negative real interest rate environment is present, it is going to attract strong buying on such occasions, particularly if Euro-priced and British Pound-priced gold continue their impressive chart action.

 

Also, an additional kicker for gold is that the CCI, the Continuous Commodity Index, is now trading above 650 as it puts a bit of distance between itself and that critical technical chart level of 640. The commodity markets are signaling that prices had fallen far enough and that this fall had been sufficient to scare the Fed out of any further hawkish talk. I would be surprised to see much in the way of comments coming out from the usual hawks on the FOMC. As long as these economic data numbers that we keep getting are coming out on the low side of expectations and disappointing investors, the doves at the FOMC are going to be getting the airtime.

 

Note that the Dollar has broken down through the 50 day moving average at this hour and is also down below support near 75.20. A week close today does not bode well for next week.- Dan Norcini, More at http://www.traderdannorcini.blogspot.com/

 

GATA Posts:

GoldMoney interviews GATA Chairman Bill Murphy

 

The Statistics:

Activity from: 5/26/2011

Gold Warehouse Stocks:

10,874,645

-271,824

Silver Warehouse Stocks:

101,427,606

-383,025

 

Global Gold ETF Holdings

[WGC Sponsored ETF’s]

 

Product name

Total Tonnes

Total Ounces

Total Value

New York Stock Exchange Arca (NYSE Arca) AND Singapore Exchange (SGX) AND Tokyo Stock Exchange (TSE) AND Hong Kong Stock Exchange (HKEx)

SPDR® Gold Shares

1214.079

39,033,842

US$59,820m

London Stock Exchange (LSE) AND NYSE Euronext Paris AND Borsa Italiana AND Frankfurter Wertpapierbörse (Deutsche Börse - Xetra)

Gold Bullion Securities

115.35

3,708,632

US$5,696m

London Stock Exchange (LSE) AND NYSE Euronext Paris AND Borsa Italiana AND Frankfurter Wertpapierbörse (Deutsche Börse - Xetra) AND NYSE Euronext Amsterdam

ETFS Physical Gold

126.23

4,058,350

US$6,235m

Australian Stock Exchange (ASX)

Gold Bullion Securities

14.21

474,205

US$701m

Johannesburg Securities Exchange (JSE)

New Gold Debentures

48.12

1,547,101

US$2,349m

NASDAQ Dubai

Dubai Gold Securities

0.154

4,955

US$8m

 Note: No change in Total Tonnes from yesterday’s data.

 

COMEX Gold Trust (IAU) Total Tonnes in Trust: 137.61: +0.67 change from yesterday’s data.

 

Silver Trust (SLV) Total Tonnes in Trust: 9,941.33 - No change from yesterday’s data.

 

The Miners:

 

Tanzanian Royalty’ (TRE) detailed review of historical drilling programs, Buenaventura’s (BVN) resumed operations, and Gold Resource’s (GORO) Special Cash Dividend were among the big stories in the gold and silver mining industry making headlines Friday.

 

WINNERS

1.  Harmony

HMY +6.32% $13.79

2.  Great Panther

GPL +6.27% $3.22

3.  Rubicon

RBY +5.68% $4.84

 

LOSERS

1.  Kimber

KBX -3.45% $1.68

2.  Vista Gold

VGZ-2.93% $2.98

3.  Solitario

XPL -1.56% $3.16

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

       

All of today's gold and silver stock news:

 

Cream Minerals Ltd. Board of Directors Approves Adoption of Shareholder Rights Plan - More
- May 27, 2011 | Item | ShareThis


Delta Uranium Agrees to Issue Shares for Indebtedness - More
- May 27, 2011 | Item | ShareThis


Barrick Reviews Zambian Clearance for Equinox Acquisition - "Barrick Gold Corporation (NYSE:ABX - News)(TSX:ABX - News) ("Barrick" or "the Company") announced today that the Zambian Competition and Consumer Protection Commission (the "CCPC") has disclosed that it has issued a conditional authorization for Barrick's proposed acquisition of all of the issued and outstanding common shares (the "Equinox Shares") of Equinox Minerals Limited (TSX:EQN - News) (ASX:EQN - News) ("Equinox"). Barrick appreciates the timeliness of the CCPC approval process to date and notes that discussions with the CCPC relating to modifying the terms of its conditional authorization are ongoing." More
- May 27, 2011 | Item | ShareThis


TVI Pacific Announces the Results of Its Annual & Special Meeting of Shareholders - More
- May 27, 2011 | Item | ShareThis


Encore Renaissance Receives a Joint Venture Offer on the Bonaparte Gold Project - More
- May 27, 2011 | Item | ShareThis


Mitsubishi Issues Standard Force Majeure Notice to Copper Mountain - More
- May 27, 2011 | Item | ShareThis


Adroit Resources Inc.: $1,000,000 Private Placement Agreed - More
- May 27, 2011 | Item | ShareThis


Detailed Review by Tanzanian Royalty of Historical Data at Buckreef Project Reveals Significant Drill Hole Assays in Eastern Porphyry Area - "Tanzanian Royalty is pleased to report that it has completed a detailed review of historical drilling programs on its Buckreef Gold Mine Re-development project in Tanzania." More
- May 27, 2011 | Item | ShareThis


Goldstone Announces 2011 Annual Meeting Date - More
- May 27, 2011 | Item | ShareThis


Ivernia Closes Previously Announced Financing - More
- May 27, 2011 | Item | ShareThis


Lion One Metals Limited: Tuvatu Gold Project Phase 1 Exploration Program - More
- May 27, 2011 | Item | ShareThis


Stellar Update on Sale of Quebec Assets and Shares Distribution - More
- May 27, 2011 | Item | ShareThis


Operations Resume at Buenaventura's Orcopampa Mine - "Compania de Minas Buenaventura S.A.A. ("the Company" or "Buenaventura") (NYSE:BVN - News) announced today that has reached to an agreement with the Orcopampa workers' union, within the frame of the annual collective negotiations." More
- May 27, 2011 | Item | ShareThis


NMC Resource Reaches 66.4% of 2010 Sales Figure in Q1, 2011 - More
- May 27, 2011 | Item | ShareThis


Beaufield Starts Fieldwork for Iron at Schefferville - More
- May 27, 2011 | Item | ShareThis


Creso Reports up to 266 g/t Au From Surface Sampling Program at the Downey Property, Asquith Township at the Shining Tree Project - More
- May 27, 2011 | Item | ShareThis


ValGold Commences Phase 2 Drill Program on Tower Mountain Gold Property, NW Ontario - More
- May 27, 2011 | Item | ShareThis


Yellowhead Mining Inc.: Drill Hole HC11-87 Returned Best Intersection to Date at Harper Creek - More
- May 27, 2011 | Item | ShareThis


Search Minerals Appoints Investor Relations Consultant - More
- May 27, 2011 | Item | ShareThis


GoldQuest Schedules Annual Meeting of Shareholders and Announces Director Nominees - More
- May 27, 2011 | Item | ShareThis


Assay Results Confirm Gold Silver Mineralization in Tigre Viejo Canyon at the El Tigre Property, Sonora, Mexico - More
- May 27, 2011 | Item | ShareThis


Silver Bull Intersects 7.6 g/t Gold Over 9 Meters in Gabon - More
- May 27, 2011 | Item | ShareThis


Athena Silver Begins Preparation of NI 43-101 Technical Report on Langtry Silver Project - More
- May 27, 2011 | Item | ShareThis


Avanti Extends Letter of Intent With SeAH Holdings Corp Until June 17, 2011 - More
- May 27, 2011 | Item | ShareThis


Moly Mines Company Update - More
- May 27, 2011 | Item | ShareThis


Alexis Extends Main Mine East Zone, Snow Lake Intersects Up to 4.38 Meters Grading 12.4 g/t Gold - More
- May 27, 2011 | Item | ShareThis


Antioquia Gold Discovers Two New Gold Zones at Cisneros Project, Colombia - More
- May 27, 2011 | Item | ShareThis


Century Mining Announces Flow-Through Financing - More
- May 27, 2011 | Item | ShareThis


Radius Plans Spin Out of Yukon Assets - More
- May 27, 2011 | Item | ShareThis


Mountain Lake%u2019s Glover Island Gold Project Advances to Environmental Assessment Registration - More
- May 27, 2011 | Item | ShareThis


LIM Closes $11.25 Million Over-Allotment Option - More
- May 27, 2011 | Item | ShareThis


Sonora Resources Completes Promising Geophysics Program at Los Amoles Silver Prospect - More
- May 27, 2011 | Item | ShareThis


RX Exploration Inc. Postpones Annual and Special Meeting of Shareholders to July 26, 2011 - More
- May 27, 2011 | Item | ShareThis


American Bonanza Commences Trading on the OTCQX - More
- May 27, 2011 | Item | ShareThis


Bannerman Board Changes - More
- May 27, 2011 | Item | ShareThis


GGG Extends Offer Period While It Awaits Further Disclosures From Auzex - More
- May 27, 2011 | Item | ShareThis


Gold Resource Corporation Declares Eleventh Special Cash Dividend - "Gold Resource Corporation (GORO) (NYSE Amex: GORO) is pleased to announce it has declared its May Special Cash Dividend of $0.04 per common share to its shareholders of record June 13, payable June 17, 2011. Gold Resource Corporation is a low-cost gold producer with operations in southern Mexico." More
- May 27, 2011 | Item | ShareThis

- Chris Mullen, Gold Seeker Report

 

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© Gold Seeker 2011

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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.

 


-- Posted 27 May, 2011 | |


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