Precious metals have not responded to Cyprus right now.

Gold had begun the week with the huge sell off. The price was under $ 1600. There were explicit attempts to hold the price under this level. Gold crossed $ 1600 on Wednesday to be under it once again when lost $ 9 on Thursday. Silver was a little bit different story. It almost nothing happened during first two days of the week. The sell-off showed up on Wednesday but was totally erased during the day. Silver had followed gold pattern on Thursday and lost $ 0.33. Friday was a free trading day but HFT mechanisms did some bizarre attempts to put both prices down during the early Asia trading hours.

Gold finally closed on $ 1597.6 per ounce what was $ 11.6 lower compared to previous week. Silver closed on $28.30 per ounce what the same story as on gold – down $ 0.46 compare to previous week. The gold/silver ratio is 1 to 56.45 (i.e. you could buy 56.45 gram of silver for 1 gram of gold, it was 55.95 week before). So it was gold once again which was a little bit more successful this week. HUI index (index of the most important gold mining companies) was $ 357.11 and was down of $2.71 compared to previous week. XAU index (index of gold and silver mining companies) was $ 135.76 what was $ 2.5 down compare to the previous week. Net short concentrated positions of bullion banks on COMEX were down on both metals. Bullion banks decreased their net short positions on silver by almost 2,400 contracts and on gold by 3,900 contracts.

There are not many changes on gold and silver market right now and I think that we are still in an awaiting position. The situation about Cyprus is still unclear because we still do not know with absolute certainty what the percentage of nationalization of deposits over € 100,000 is (20%? 30% 40% or more). Once they nationalize these deposits I mean when people will directly see on their banking accounts less money we can expect some fear of rich people and their increased interest in gold. Spot prices are slightly under futures prices but from time to time we could see short term bakwardation on the market which indicates distrust of investors towards the paper market. Top City analyst Tom Fitzpatrick is bullish on both gold and silver. He claims that we are still in the situation when the bottom on both prices is forming. The longer formation means bigger moves once the market will get the impulse. The most important levels for both metals are from his point of view $35 on silver and $1790 on gold.

Overview of the prices of gold and silver for the remaining periods:


Gold chart


Silver chart



Matúš Pošvanc

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About matus.posvanc

Trhu so zlatom a striebrom sa venujem od roku 2011. Prešiel som rôznymi fázami a pohľadmi na problematiku. "Trh je manipulovaný. To je jasné!" Inak by cena zlata predsa nešla dole. "Zlato na úrovni 100 tis. USD? Žiaden problém." Najneskôr do pár rokov. "Futures trh je najväčšie zlo a tzv. papierové zlato je nutné zakázať". Nuž, po dlhom štúdiu tejto problematiky, som hlúposti a táraniny opustil. Ostalo to, čo považujem za podstatné. Význam zlata je veľký. Avšak bez pochopenia trhu okolo neho, sa sám od seba znovu neobjaví. Kúpiť zlato ako časť svojho portfólia má zmysel. Snažiť sa na zlate zbohatnúť? To je iný príbeh. Jednu jeho časť nájdete na mojom blogu.
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