Latest Gold & Silver Price News
Jakobsen argues that in the current economic environment that what a metals trader needs to focus on is deflation. When deflation bottoms out, which is something likely to happen during Q1 of 2015, it will be the biggest buy signal for metals. Jakobsen’s base scenario is that Q1 and Q2 will become the worst part of the business cycle with the lowest inflation expectation, the lowest growth, the lowest ability to do anything and increasing volatility at the same time. But he believes that as this low energy, as these low interest rates and as the terms of trade for Europe improve, we will see a better second half than we’ll see a first half.
Despite price weakness in 2014, which inspired a lot of badmouthing of precious metals in the financial media, silver coin demand hit new records. The U.S. Mint sold more than 44 million Silver Eagles, up from 42.7 million the prior year. At one point last fall, the dysfunctional government mint had to suspend orders because it couldn’t keep up with demand.
The price of gold is showing encouraging signs. A basing pattern, which has been in the making for a year and a half, seems to be fully intact, contrary to the doomsday prophecies of mainstream media which predicted $800 gold. The Euro gold chart for 2013 and 2014 shows the breakdown of early 2013, followed by a stabilization period. That could be coming to an end as of this week. gold is attempting to break above the long term resistance line.
In its monthly industry release, The Silver Institute reported once again new applications of silver in products across several industries. The Silver Institute has written extensively how silver has helped breakthrough improvements in product development and industries.
If we review the events of 2014, it seems the situation has intensified: governments are still overwhelmed with debt, our fiat money system is unsupported, our central banks insist on accumulating debt and making money valueless. It doesn’t look all too good. Or does it? Will someone realize we have to pull the plug? And when we do, because it will happen whether we want it or not, how can we support ourselves from the damage that we will all have to endure? I am a strong advocate of physical gold and can’t stress enough the importance of owning physical precious metals stored outside the banking system.
I have no idea how the Greek elections will affect gold, but I do think any signals we need will show up on the price chart. Yes, turn off the TV and turn on the chart. Note that the long-term trend is down because gold hit a new low in early November. This means the bounce from 1140 to 1240 is a counter-trend move and the break below 1180 is bearish until proven otherwise. Gold has yet to continue lower as prices firmed the last two weeks, but I would like to see a break above 1220 to negate this bearish signal and consider a bullish alternative.
The chart setup for gold and silver does not really look like prices are ready to move much higher, at least not in the short run. Excellent chart analysis of gold and silver was provided by Michael Noonan in Gold And Silver Charts Going Into 2015: Expect More Of The Same, courtesy of ChartAnalyst.expert. Although we should not expect fireworks in terms of price, there are some favorable trends “under the hood”. They do not reflect the generally accepted pessimism towards the metals among investors. Our belief is that it will take some time until the price will move back in line with these fundamental trends. Until then, gold or silver owners can rest assured that the gold and silver market is not as bad as some would like to make you believe.
In his weekly market review, Frank Holmes of the USFunds.com summarizes this week’s strengths, weaknesses, opportunities and threats in the gold market for gold investors. Gold closed the week at $1,187.88 down $8.12 per ounce (-0.68%). Gold stocks, as measured by the NYSE Arca Gold Miners Index, gained 3.72%. The U.S. Trade-Weighted Dollar Index rose 1.20% for the week.
Given the wealth of stories available, we choose to focus on the most compelling one as told by the charts. Keep in mind, when we say charts, they are a reflection of developing market activity that tells the most accurate and current story. It is not a promising one, as of the end of the year and heading into 2015, but it is reality, and to expect anything else will lead to the same disappointments of 2013 and 2014. Forget the ego-driven predictions that have all proven wrong again and again, and deal with what is.
As requested by one of our readers, we provide in this article an update of the long term gold and silver charts. The charts show the recent price breaking out of the major uptrending channel since the start of the secular bull market in 2001. These charts could suggest that the ongoing correction could be “balancing off” the extended rise of 2011. However, there is not too much time left for the price of the metals to reverse its course. If the precious metals do not reverse their trend somewhere in 2015, then the long term trendline has been invalidated. Time will tell.
The essential trust in fiat currencies is beginning to fade. People look aghast at the “debt clock” in Times Square now surpassing $18 trillion. Their minds are boggled at the trillions of new dollars created by the Fed via extraordinary maneuvers such as Quantitative Easing. Today, there are real questions about the solvency of the U.S. government, and the value of the scrip issued on its behalf.
Given the data points discussed in this article, it is fair to say that Japan is on track for a devastating bust at some point in the future. The unknown factor is timing. When the inevitable will take place is anyone’s guess. The fate of countries like Japan is really in the hands of central bankers. However, central planners are not able to manipulate markets infinitely. At a certain point, something has to give. That is when the markets will give up and disbelief will replace trust. Readers should remember that in such a bust scenario, people flee down the Golden Pyramid of asset classes to their safe haven, being gold.
The Gold SPDR got a big bounce on the 26th, but remains in a downtrend overall. The upper line of the Raff Regression Channel marks the first resistance area in the 115.2 area. I will leave key resistance in the 116-116.5 area for now. The Silver ETF has resistance in the 15.5-15.7 area.