Kitco Market Nuggets
Market Nuggets: Silver Technical Chart Pattern Suggests 'Indecision'

17 September 2010, 4:15 p.m.
By Debbie Carlson
Of Kitco News
http://www.kitco.com/

(Kitco News) -Silver prices could be forming a bearish technical chart pattern and the market could be prime for profit-taking. John Person, president, National Futures.com, said on Friday silver prices formed a “Doji” pattern on Japanese candlestick technical chart work. That suggests indecision on the part of traders. In bull markets the gap between where prices open and close is wide, but Friday silver saw those prices close together. That signals less commitment by bulls, he said. Silver prices could pull back by $1 to $1.25 an ounce, with support at $19.50 “not out of the question,” Person said.

By Debbie Carlson of Kitco News; dcarlson@kitco.com

17 September 2010, 2:51 p.m.
By Allen Sykora
Market Nuggets: MKS Finance Says Gold Could Turn Volatile

(Kitco News) - With gold hitting record highs, there could be a pick-up in volatility, says MKS Finance. The trade house describes the market as “edgy” after a day that alternately saw profit-taking but also hedge-fund buying. Comex December gold hit a peak of $1,284.40 an ounce that is a record for a most-active contract. “The market has hit new highs, but at these rarified levels, investors continue to be wary…,” says MKS, citing an expectation for choppy conditions. MKS concludes, “while the yellow metal ought to continue to rise, it will be a volatile trip.”  

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

17 September 2010, 10:12 a.m.
By Allen Sykora
Market Nuggets: Investor Sentiment 'Lukewarm' Despite Gold's Rise--GoldCore

(Kitco News)--GoldCore says sentiment toward gold remains “lukewarm” among the general public, citing this as evidence that the rally in prices has not reached the point of “irrational exuberance.” The “mainstream press” is still “barely covering” gold’s run to record highs, Goldcore says. “Another indication of the lack of animal spirits or irrational exuberance in the gold market is the recent decline in investor buying of gold (and silver) coins,” GoldCore says. Coin premiums have fallen since 2008, when Lehman Brothers failed, GoldCore says. “In the aftermath of the Lehman Brothers collapse and the ensuing crisis, premiums surged as investors and savers scrambled to buy bullion coins, leading to rationing and shortages. There is nothing like that happening in the bullion markets today.” Instead, GoldCore describes recent sales as “steady” with “no element of the public piling into gold.”

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

17 September 2010, 9:55 a.m.
By Allen Sykora
Market Nuggets: Goldman Says Move To $1,300 Gold Could Accelerate

(Kitco News) - Goldman Sachs says there are some potential factors that could speed up gold’s rise to the investment bank’s six-month target of $1,300 an ounce. However, Goldman also lists a long-term risk. “For gold, we maintain that the low U.S. real interest-rate environment will allow prices to continue to move higher, with a 6-month target of $1,300/oz,” Goldman says. “Further, we expect that a resumption of quantitative easing would likely accelerate the move to our 6-month price target and provide upside risk to our forecasts.” Additionally, Goldman says, while speculative net length in Comex futures is approaching its highest level of the year, gold ETF holdings rose only “modestly” in August and are flat over the past three weeks. This suggests “gold prices could move faster to our 6-month target should gold-ETF buying come back to the market following the recent rally to a new record-high gold price.” Goldman lists a 12-month forecast of $1,365. Still, Goldman cites a “considerable” long-term downside risk, should the Federal Reserve tighten monetary policy earlier than expected.

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

17 September 2010, 9:54 a.m.
By Allen Sykora
Market Nuggets: Goldman Looks For Platinum To Outperform Gold

(Kitco News) - Goldman Sachs says it looks for platinum prices to rise with gold, and "likely outperform as the cyclical recovery in the automotive industry pushes platinum demand against a constrained supply base, notably in South Africa." Within the commodities arena, Goldman says the near- to medium-term fundamentals remain most constructive for crude oil, copper, platinum and corn, with the short-term risk/reward looking best for crude oil. Goldman says it maintains an "overweight" recommendation for commodities. Goldman says "recovering global automobile demand will likely continue to put upward pressure on auto-catalyst demand and therefore on platinum and palladium prices." In the case of copper and crude oil, Goldman cites "expectations that supportive policy shifts in China and the United States, on top of already exceptionally high levels of emerging-market commodity demand, will lead to further tightening in commodity fundamentals."

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

17 September 2010, 8:59 a.m.
By Allen Sykora
Market Nuggets: Commerzbank Looks For Silver To Meet Resistance at $21

(Kitco News)--Silver prices may run into chart resistance around $21 an ounce, says Commerzbank. Spot silver touched a high of $21.03 so far Friday, pulled along by gold. The metal was last at $21 in March 2008, when it peaked at $21.35, Commerzbank reports. “The closeness to this mark, a 30-year high, should attract further financial investors. It is therefore probably only a matter of time before this price level is reached,” Commerzbank says in a report early Friday. “That said, it is unlikely to advance beyond this mark very quickly because of the technical resistance to be expected.” At 8:32 EDT (1232 GMT), spot silver was up 9 cents to $20.89.

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

17 September 2010, 8:37 a.m.
By Allen Sykora
Market Nuggets: Barclays Expects Strong Fourth Quarter For Gold

(Kitco News)--Market speculation over further quantitative easing, against an environment of low interest rates and industry plans for further producer hedge-book buy-backs, have propelled gold to record highs prices, says Barclays Capital. Jewelry demand has waned some due to high prices, but Barclays says it expects physical interest to materialize due to the good monsoon season in India and expectations for still higher prices. Barcalys says “we maintain our view for the fourth quarter of this year to be the strongest quarter on record yet for gold prices, with downside corrections finding support from the seasonally strong period for fabrication demand with the forthcoming wedding and festival season in key gold-consuming countries.” Global gold exchange-traded-product holdings edged higher Thursday but are flat for the month so far, Barclays says. Silver ETP holdings remained at a record 13,212 metric tons, but are up 155 tons so far in September.

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