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Gold Challenges Resistance at $1,750/oz

Tyler Durden's picture




 

From GoldCore

Gold Challenges Resistance at $1,750/oz – Technicals and Fundamentals Remain Very Positive

Gold’s London AM fix this morning was USD 1,747.50, EUR 1,326.68, and GBP 1,102.80 per ounce. Yesterday's AM fix was USD 1,744, EUR 1,327.65, and GBP 1,106.74 per ounce.


Cross Currency Table - Bloomberg

Gold has seen quite volatile up and down trading in Asia and Europe but within a narrow $10 band.

It saw gains initially in Asia to $1,752/oz before a retracement to $1,744/oz. It then rose to $1,750/oz again as Asian trading closed.

Early European trading saw gold quickly fall from over $1,750/oz to below $1,746/oz prior to a quick reversal and gold reaching an eight week high at $1,753.45/oz.

Resistance is at $1,750/oz and there appears to be a determined seller at these levels.


Gold Spot $/oz  - 2 Days (Bloomberg)

However, the short term technicals are positive with a series of higher lows and higher highs. 

Gold has risen to 8 week highs despite positive manufacturing data, higher factory activity in Germany, China and the US and the hope that a Greek debt restructuring solution is imminent.

Demand for physical in Europe, Asia and internationally remains robust which is supporting gold. 

Investors will today watch the US weekly jobless claims data for the week ending January 28th.

Adding to the very gold supportive interest rate backdrop, Japan's finance and economic ministers are putting pressure on the Bank of Japan to consider easing monetary policy even further.

Negative yields on some bonds (such as TIPS) are very gold positive as is moves to let investors buy short term bills with negative yields.  

Gold is also being supported by central bank buying. Russia's gold and foreign exchange reserves rose to $504 billion in the week to Jan. 27 from $499.7 billion a week earlier.

Knowledgeable industry participants continue to be bullish on gold.  

Newcrest Mining, the world's third largest gold producer, expects gold to trade as high as $2,500 an ounce and retain its safe harbour status for as long as the world's financial system remains in crisis.

Newcrest chief executive Greg Robinson said today that gold will remain a hedge against a global financial breakdown, citing risks such as a devaluation of the U.S. dollar, today’s global currency, European economies in dire shape and persistent political tensions throughout the globe.

Bank of America Merrill Lynch said today that gold bullion may reach $2,000/oz in Q4, up from a 1Qtr estimate of $1,850.

For breaking news and commentary on financial markets and gold, follow us on Twitter.

SILVER 
Silver is trading at $33.72/oz, €25.66/oz and £21.30/oz. 

PLATINUM GROUP METALS 
Platinum is trading at $1,618.00/oz, palladium at $689/oz and rhodium at $1,400/oz. 

(Bloomberg) -- China’s demand for gold will continue to rise on growing incomes and investment against inflation, Albert Cheng, World Gold Council’s managing director for the Far East region, says in email. Given the country’s “strong affinity to gold” and record imports in November, this year is “set to be a strong year” in a part of a longer-term trend, Cheng says

(Bloomberg) -- Turkey’s gold imports were 2.96 metric tons in January, the Istanbul Gold Exchange said on its website today. Silver imports were 4.2 tons last month, the data show. Holdings rose from 4.4 million ounces in October and 3.7 million ounces in September, according to the data. In September and November, Turkey’s central bank increased the proportion of required reserves that commercial banks can deposit in gold. The changes have increased the amount of gold Turkey declares in its official reserves.

(Bloomberg) -- Iran has $120 billion in foreign currency reserves and 907 tons of gold, the Tehran Times reported, citing Yahya Ale-Eshagh, who heads the Tehran Chamber of Commerce, Industries and Mines.

The gold reserves have a total value of $17.5 billion, the newspaper cited Ale-Eshagh as saying. Iran has “no shortage” of foreign currencies or gold to meet domestic demand, he said.

Ale-Eshagh said recent fluctuations in the gold and currency markets were a result of mismanagement by some state bodies; he called for tighter monetary control by the government, according to the report.

NEWS
(Reuters)
Gold rises to 8-week high, firm euro supports

(Reuters)
Gold in a bubble? Not in Europe, where public can't sell fast enough

(Reuters)
Economic woes could push gold to $2500-Australia's Newcrest‎

(CNBC)
Fed's Low Rates Killing Credit, Slowing Recovery: Gross

(BusinessWeek)
California Will Borrow Up to $1 Billion to Skirt Cash Crisis

COMMENTARY

(ZeroHedge)
Bill Gross Explains Why "We Are Witnessing The Death Of Abundance" And Why Gold Is Becoming The Default "Store Of Value"

(Max Keiser)
The Historical Case For $960 Silver

(Benzinga)
Central Bankers Weaken Their Currencies, Boost Gold

(The Economic Collapse Blog)
34 Shocking Facts About U.S. Debt

(RT)
Chinese 'gold rush': Country diversifying assets

(Ludwig Von Mises Institute)
Currency Wars

 

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Thu, 02/02/2012 - 09:05 | 2119424 DollarDive
DollarDive's picture

Volatility in the AUD.USD..... Several out of ordinary price bars already.  Something coming ?   This may be getting ready to break to the downside in a big way.  Who knows.  Just a thought..... data is interesting though.

 

http://displacedema.blogspot.com/2012/02/audusd-5m-range-17pip-bars-are-...

Thu, 02/02/2012 - 09:14 | 2119431 GetZeeGold
GetZeeGold's picture

 

 

Gold should be over $2000. Fair value with the last debt ceiling raise was $1900s.

 

Hot QE cash holds gold at $1750......but how much is it costing them?

 

It appears we are doing nothing more than subsidizing Chinese gold purchases.....perhaps that is the quid pro quo.

 

 

 

Thu, 02/02/2012 - 10:23 | 2119614 Badabing
Badabing's picture

We don’t need no stinking charts.

It’s a counterfeit market, the numbers don’t add up.

What resistance at $1750? TPTB don’t want gold to go expediential like everything else so they just fake it.

Thu, 02/02/2012 - 10:37 | 2119685 HardlyZero
HardlyZero's picture

Lock it down !  Don't flash your stash...its getting tight out there !

$3 million in gold nuggets stolen from Yreka courthouse

Thieves in Yreka, Calif., made off with $3 million in gold nuggets Wednesday after breaking into the Siskiyou County Courthouse and smashing a glass case that contained a display on the area's mining history, officials said.

The collection in the town near the Oregon border was about the only remnant of the Northern California county’s little-known Gold Rush days.

Founded after gold was discovered there in 1851, Siskiyou County came to be known as “the second Mother Lode,” said local historian Claudia East. “But a lot of times, we’re just kind of left out.”

http://latimesblogs.latimes.com/lanow/2012/02/3-million-in-gold-nuggets-stolen-from-yreka-courthouse.html

Thu, 02/02/2012 - 10:46 | 2119728 Rakshas
Rakshas's picture

I'd bet it was a take down by the Hoffman/Schnabel Gang.....

gotta find gold somewhere... 

Thu, 02/02/2012 - 10:12 | 2119576 doomz78
doomz78's picture

the banking cartel keeps gold down to allow china to accumulate.  and to allow an orderly decline in the us dollar.  it is actually very nice of them and responsible.  thanks ben and the boys.  china apreciates this also.

Thu, 02/02/2012 - 09:05 | 2119425 achmachat
achmachat's picture

lol @ "...and there appears to be a determined seller at these levels"

Thu, 02/02/2012 - 09:05 | 2119426 bullionbaron
bullionbaron's picture

Alf Field's latest prediction was $4500 for Gold and is now also calling for $158 Silver, interesting times http://www.bullionbaron.com/2012/02/what-about-silver-alf-field-february...

Thu, 02/02/2012 - 09:08 | 2119430 CPL
CPL's picture

It's the only currency worth anything right now.  We will see more and more direct trade action using gold and silver as the currency medium to trade.

 

The powers that be wanted an international currency.  Well it got one.  Just not one they wanted.

Thu, 02/02/2012 - 09:11 | 2119433 EmileLargo
EmileLargo's picture

The only reason not to buy gold today is that you bought a lot yesterday.

Thu, 02/02/2012 - 10:39 | 2119697 HardlyZero
HardlyZero's picture

Don't wait and buy Gold....Buy Gold and wait.

Thu, 02/02/2012 - 09:11 | 2119434 Ex-Pat
Ex-Pat's picture

Aren't the unemployment numbers leaked 48 hours in advance?  What are they?

Thu, 02/02/2012 - 09:17 | 2119443 Peter Pan
Peter Pan's picture

Predictions about the price of gold and silver are a dime a dozen in a market that is rigged.

Predictions about future value of precious metals against a basket of goods and services would be more relevant.

Thu, 02/02/2012 - 09:22 | 2119450 youngman
youngman's picture

"It appears we are doing nothing more than subsidizing Chinese gold purchases.....perhaps that is the quid pro quo."

I agree 100% with this...The Chinese are not stupid...they negociated this years ago I bet...."we will buy your treasuries..but we want insurance"...IMHO

and the end game is when they have enough PM´s..they will introduce a new money backed by PM´s for the world..

Thu, 02/02/2012 - 09:26 | 2119464 mayhem_korner
mayhem_korner's picture

 

 

Resistance, support, 50-day and 200-day moving averages, head and shoulders formations, flags, etc. are all technical trading metrics for the paper trade.  Physical doesn't pay attention to technicals.  All this is simply commentary on the paper trade, which is diluted by the day.

Stack.  Wait.  Win.

Thu, 02/02/2012 - 09:35 | 2119474 JPM Hater001
JPM Hater001's picture

"Turkey’s gold imports were 2.96 metric tons in January, the Istanbul Gold Exchange said on its website today. Silver imports were 4.2 tons last month."

Agreed.  Does this look like 51:1?

Thu, 02/02/2012 - 09:28 | 2119467 monopoly
monopoly's picture

Patience all, patience. It is working out just fine.

Thu, 02/02/2012 - 09:35 | 2119476 RazorForex
RazorForex's picture

Gold right now is diverging heavily and is compressing. Will be interesting to see if there is any reaction during the Bernanke speech.

http://www.youtube.com/watch?v=l9GhlfcjqFY

Thu, 02/02/2012 - 09:49 | 2119506 kralizec
kralizec's picture

Ben is good at moving it, ain't he?!

Thu, 02/02/2012 - 09:35 | 2119479 onebir
onebir's picture

Why doesn't Goldcore get the "Guest Post:" prefix...?

Thu, 02/02/2012 - 09:38 | 2119483 Hobbleknee
Hobbleknee's picture

Bust a move!

Thu, 02/02/2012 - 09:53 | 2119521 vegas
vegas's picture

Ok, we got near unanimous agreement that demand is robust and everybody wants gold. So who's selling and keeping the lid on this at 1750? Remember, last NFP we got to 1762 before rumors of Fed selling gold smacked the snot out of the price. So, more manipulation up here again by the likes of Blythe  & HSBC. 4 weeks to get back here, 10 minutes to test support; so what else is new in the never ending global CB manipulation of the PM group.

 

http://vegasxau.blogspot.com

Thu, 02/02/2012 - 10:04 | 2119552 GetZeeGold
GetZeeGold's picture

 

 

It's simple......the Fed takes public money and forces gold down. They and their friends in the know buy the actual physical gold....courtesy of the American taxpayer.

Not to say the Fed is all that bright......Gordon Brown came up the the orginal idea.

 

 

Thu, 02/02/2012 - 10:51 | 2119749 GetZeeGold
GetZeeGold's picture

 

 

Who just junked me? Benny....is that you....or is that you Gordon?

 

 

Thu, 02/02/2012 - 10:21 | 2119603 Acet
Acet's picture

Well, this week most of the steepest falls in the price of Gold seem to happen during US trading hours, after Asia goes offline.

At the same time, the constant increases in the US debt ceiling are only sustainable as long as the US Dollar remains as the world's reserve currency. The rise of a competing store of value that is out of the control of the US Government and which by it's own nature cannot be debased through printing would risk the reserve currency status of the dollar.

Finally, there doesn't seem any independent assessment of the size of the US' physical gold reserves.

1+1 = 2 ?

 

Thu, 02/02/2012 - 10:20 | 2119599 disabledvet
disabledvet's picture

Does the gold/silver ratio work in reverse? Cuz if silver hit 50 when gold hit 800...as happened back in 1980...gold at 1700 means that silver should be at 150 bucks. if that doesn't happen then would gold gold end up say...below 800 an ounce from here? say like...700?

Thu, 02/02/2012 - 10:33 | 2119664 Badabing
Badabing's picture

The true price of gold

If I had one ounce of gold and was able to sell that one ounce one hundred times over, it would be worth $175000.00 right now. That’s what HSBC, Goldman, Morgan……………..and the list goes on.......

 

got gold in hand?

Thu, 02/02/2012 - 11:43 | 2119985 Loan Gunman
Loan Gunman's picture

Love watching these guys on C-span.  Wouldn't hire any of them to mow my law.

Thu, 02/02/2012 - 11:47 | 2120006 Badabing
Thu, 02/02/2012 - 13:02 | 2120348 jon
jon's picture

hard to believe it's 2012 and people still talk like this.

federal reserve note begs pitifully for support at 1/1750 troy oz.

Thu, 02/02/2012 - 16:35 | 2121152 akak
akak's picture

When fiat printing presses are outlawed, only outlaw banksters will own fiat printing presses.

Do NOT follow this link or you will be banned from the site!