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(Kitco News) - Mike Daly, gold and silver specialist with PFGBEST, says traders will be on the lookout to see whether recent weakness in gold will bring about bargain hunting. Prices fell Wednesday as the market continued to react to a Federal Open Market Committee statement the day before construed to mean little chance of further U.S. quantitative easing. Previously, gold was underpinned by physical buying from Asia, geo-political tensions involving Iran and the West and leading to higher crude prices, plus hints in the early part of the year of more Fed easing. Removal of the latter has taken some of the glitter out of gold, Daly says. “However, keeping interest rates at benchmark lows through 2014 is bullish gold,” says Daly of the Fed’s stated intentions so far. “We will see if this recent three-trading session price break will bring bargain-buying opportunities.”

By Allen Sykora of Kitco News; asykora@kitco.com

Market Nuggets: Triland: Gold Market Remains Heavily Long, Meaning More Scope For Weakness

14 March 2012, 2:32 p.m.
By Kitco News
http://www.kitco.com/

(Kitco News) - Triland Metals cautions that speculators remain heavily long in gold despite the recent pullback in prices, meaning potential for more downside if liquidation continues. "Another FOMC meeting and another serious wound to the gold market," Triland says. "The lack of any mention of QE3 (third round of quantitative easing) and the ongoing succession of good U.S economic data are inducing gold longs to liquidate positions." Comex April gold has fallen to an eight-week low of $1,635.80 an ounce and was down $55.70 to $1,638.50 as of 2:21 p.m. EDT. "This market remains very long and the scope for further falls is large, especially if the cavalry (China/India /ETF buyers) do not arrive soon," Triland says. Analysts say major support now lies between $1,620 and $1,625 an ounce, with resistance between $1,660 and $1,665.

By Allen Sykora of Kitco News; asykora@kitco.com

Market Nuggets: TDS: Gold Has ‘Heavy Undertone’ On Technical Charts

14 March 2012, 10:39 a.m.
By Kitco News
http://www.kitco.com/

(Kitco News) - The U.S. dollar is stronger as the U.S. economic outlook improves and yield differentials move in of the greenback, says Eric Viloria, senior currency strategist with FOREX.com. “Market sentiment is higher and the buck is gaining on shifting monetary policy expectations and strong fundamentals while impacted less by the risk-on environment, which has been associated with USD weakness,” he says. “Global equities are broadly higher with most of Europe currently trading in positive territory and U.S. stock futures are relatively flat. Commodities are softer on the back of a stronger USD and the Dollar Index continues to advance above the top of its daily cloud.” As of 9:48 a.m. EDT, the euro was down to $1.3056 from $1.3081 late Tuesday and was more than 2 cents lower than last week’s peak of $1.3291. Metals traders tend to closely monitor forex moves, as metals and other commodities often trade inversely to the dollar. All of the precious and base metals, except nickel, are lower so far Wednesday.

By Allen Sykora of Kitco News; asykora@kitco.com

Market Nuggets: FOREX.com’s Viloria: U.S. Outlook, Yield Differentials Underpin U.S. Dollar

14 March 2012, 9:59 a.m.
By Kitco News
http://www.kitco.com/

(Kitco News) - The U.S. dollar is stronger as the U.S. economic outlook improves and yield differentials move in of the greenback, says Eric Viloria, senior currency strategist with FOREX.com. “Market sentiment is higher and the buck is gaining on shifting monetary policy expectations and strong fundamentals while impacted less by the risk-on environment, which has been associated with USD weakness,” he says. “Global equities are broadly higher with most of Europe currently trading in positive territory and U.S. stock futures are relatively flat. Commodities are softer on the back of a stronger USD and the Dollar Index continues to advance above the top of its daily cloud.” As of 9:48 a.m. EDT, the euro was down to $1.3056 from $1.3081 late Tuesday and was more than 2 cents lower than last week’s peak of $1.3291. Metals traders tend to closely monitor forex moves, as metals and other commodities often trade inversely to the dollar. All of the precious and base metals, except nickel, are lower so far Wednesday.

By Allen Sykora of Kitco News; asykora@kitco.com

Market Nuggets: Barclays: Data Suggest South African Gold, PGM Mining Remains Under Pressure

14 March 2012, 8:50 a.m.
By Kitco News
http://www.kitco.com/

(Kitco News) - The most recent data from Statistics South Africa suggests mining for gold and platinum group metals remains under pressure, say analysts with Barclays Capital. January gold output fell 11.3% year-on-year, with the indexed level at its lowest in two years even though January tends to be a weak month given maintenance. PGM output fell 19.5% year-on-year and was at its lowest level since October, Barclays says. A strike against Impala Platinum cost the company an estimated 120,000 ounces of platinum. “Our economists note the sharp declines could also be the result of both maintenance and safety stoppages, and the February data is likely to paint a similar picture,” Barclays says. Analysts note, however, that South Africa’s Labor Court has suspended a safety stoppage at Northam Platinum’s Zondereinde mine, the first such legal challenge.

By Allen Sykora of Kitco News; asykora@kitco.com

Market Nuggets: Sharps Pixley: Fed News Hits Gold Again But Fundamentals Have Not Changed

14 March 2012, 8:04 a.m.
By Kitco News
http://www.kitco.com/

(Kitco News) - Federal Reserve comments have hit gold again, but the yellow metal still has some factors in its favor, says Sharps Pixley. The metal plunged on Feb. 29 when Fed Chairman Ben Bernanke did not offer any hints of further quantitative easing in congressional testimony. Gold tumbled further after a post-meeting Fed policy statement Tuesday. Sharps Pixley says the Fed remains “cautious” in its economic outlook, but analysts have “picked up some hints of optimism,” such as the Fed saying the unemployment rate has declined “notably” and upgrading the economic outlook to “moderate” from “modest” previously. Gold continues to be “hampered” by dollar strength and violent reactions to central-bank news, Sharps Pixley says. “However the longer-term fundamental picture for gold has not changed either; central banks have either stopped selling gold or diversified their reserves further into gold, and supply remains constrained in the face of rising demand.” As of 7:54 a.m. EDT, Comex April gold was $36.90, or 2.2%, lower at $1,657.30 an ounce. The bulk of that move came in after-hours screen trading following the Fed statement on Tuesday.

By Allen Sykora of Kitco News; asykora@kitco.com

Market Nuggets: Platinum Premium To Gold Rises To $30/Oz In Futures Markets

14 March 2012, 7:46 a.m.
By Kitco News
http://www.kitco.com/

(Kitco News) - Platinum futures are now roughly $30 an ounce higher than gold after platinum this week regained its historical premium to the yellow metal for the first time since September. Gold fell Tuesday when a strong U.S. retail-sales report and Federal Open Market Committee statement left doubts about whether U.S. policy-setters would undertake a new round of quantitative easing. This came on the heels of a strong U.S. jobs report Friday. “The potential for PGMs to outperform the complex is a reflection of the fact that a growth story would benefit industrials more than it would traditional safe havens, such as gold,” says UBS. Platinum has fared better than gold recently, says Commerzbank. Jewelry retailers are likely to have fallen back increasingly on platinum due to its lower price, using it as a substitute for gold, Commerzbank says. “In addition, there have been inflows into platinum ETFs (exchange-traded funds), which have likewise shored up the price,” says Commerzbank, citing Bloomberg data that platinum ETFS have increased their holdings by some 106,000 ounces, or roughly 8%, since the start of the year. As of 7:36 a.m. EDT, April gold was $36.10 lower at $1,658.10, while April platinum was $13.70 softer at $1,688.10.

By Allen Sykora of Kitco News; asykora@kitco.com

Market Nuggets: Commerzbank: Dollar, Chinese Premier's Housing Comments Pressure Base Metals

14 March 2012, 7:34 a.m.
By Kitco News
http://www.kitco.com/

(Kitco News) - Base metals are mostly lower in response to recent gains by the U.S. dollar and comments from China’s leader saying housing prices are still too high, cooling hopes that authorities will loosen policy toward the housing sector. “The firm U.S. dollar, which appreciated following the Fed’s meeting, is no doubt responsible,” says Commerzbank. “In addition, comments by Chinese premier Wen Jiabao this morning have given rise to uncertainty among market players, causing Chinese equity markets to fall sharply. He talked about inflated property prices, above all in the country’s major cities, and about the need to bring them down to an affordable level.” As of 7:22 a.m. EDT, LME three-months copper was $56 lower at $8,502 a metric ton and aluminum was down $10.50 to $2,248. Zinc, lead and tin were also lower, although nickel bounced.

By Allen Sykora of Kitco News; asykora@kitco.com

Market Nuggets: HSBC: Gold May Stabilize As Further QE Hopes 'Wrung Out' Of Market

14 March 2012, 7:25 a.m.
By Kitco News
http://www.kitco.com/

(Kitco News) - Gold may be vulnerable to further selling in the near term but the market should stabilize soon now that expectations of further U.S. quantitative easing have been largely removed, says HSBC. The metal fell again Tuesday on diminished easing hopes after a strong U.S. retail sales report and a Federal Open Market Committee statement. “Any premium that was built into the gold market on expectations of a third round of QE is essentially being wrung out by good recent economic data, Fed Chairman Ben Bernanke’s recent comments to Congress and the latest FOMC statement,” says HSBC. “Further losses near term are possible, but the gold market has effectively absorbed the Fed statement and the better economic data, so additional downside may be limited, in our view. Monetary policy is still on balance highly accommodative, and demand for gold exchange-traded funds has been very good. More important, perhaps, we may be nearing price levels that will encourage emerging-market demand, which should help stabilize prices.”

By Allen Sykora of Kitco News; asykora@kitco.com