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Eureka Miner’s Report: High Gold-Silver Ratio Unsustainable

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The rise in the gold-silver ratio is unsustainable and will correct, says Richard Baker, editor of the Eureka Miner’s Report. This ratio measures how many ounces of silver it takes to buy an ounce of gold. A rising number means underperformance by silver, and vice-versa. Baker points out that the silver has hit levels not seen since November 2008 during the financial crisis. The ratio was 86.6 Thursday, well above its 10-year average of 66.2. “This suggests silver is very, very cheap relative to the yellow metal, at least in historical terms,” Baker says. “The gold-to-copper ratio, although not extreme, is also elevated considering the safe-haven demand for gold has declined from earlier this year.”

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

 

FXTM: Pickup In Risk-Off Sentiment Would Underpin Gold

Friday April 12, 2019 08:46

Look for gold to benefit if the outlook for so-called risk assets deteriorates, says Lukman Otunuga, research analyst at FXTM. Spot metal is above $1,290 an ounce, stabilizing after Thursday’s sell-off. “Meanwhile, markets are pushing the boundaries on risk sentiment as gold fell by over 1% on Thursday before bouncing off the $1,290 mark,” the analyst says. “Although the [International Monetary Fund’s] cut to its 2019 global growth forecast was a downer, investors are hoping that a not-too-distant U.S.-China trade deal and a stabilizing Chinese economy may weaken headwinds currently felt by the global economy. However, should the outlook take a turn for the worse, that could jolt risk-off sentiment and rally support for the safe-haven assets, including bullion.” As of 8:32 a.m. EDT, spot gold was nearly steady, easing 40 cents to $1,291.50 an ounce.

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

 

SP Angel: Platinum Near Longtime Highs; ETF Demand Surges

Friday April 12, 2019 08:45

Platinum prices remain near the 11-month high hit at the start of the week, with holdings in platinum exchange-traded funds surging, says commodities brokerage SP Angel. These funds have added around 20 tonnes of metal this year, SP Angel points out. “Prices have gained as expectations for tough wage negotiations this year in top producer South Africa raised the threat of supply disruptions, and platinum’s cheapness relative to sister palladium becomes more evident,” SP Angel says. “Platinum supply has outpaced demand for the past two years and the World Platinum Investment Council has forecast another global surplus this year of 680,000 ounces. However, that may change if the South African wage talks later this year break down and workers down tools for an extended period of time.” Further, analysts point out, Anglo American Platinum’s chief executive has said there are no prospects of more new mines starting up in the foreseeable future. As of 8:32 a.m. EDT, spot platinum was $8 higher to $900 an ounce.

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

 

MKS: 100-, 200-Day Moving Averages Offer Support For Gold

Friday April 12, 2019 08:45

Long-term moving averages below current prices offer chart support for spot gold, says MKS (Switzerland) S.A.  As of 8:32 a.m. EDT, spot gold was 40 cents lower at $1,291.50 an ounce. “Chinese demand, while remaining evident as the onshore premium edged above $17, did little to propel the yellow metal higher, rather providing an underlying level of support to restrict further declines,” MKS says of the early-day activity in Asia-Pacific hours. “Over the near term, price action will focus upon the 100 DMA [100-day moving average] at $1,287, while a break below this level would potentially bring the 200 DMA at $1,250 into play. Resistance levels initially cut in at $1,300; however, of greater importance is the recent high around $1,310.”

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