Daily Market Update

Russia Accumulates Gold As Consolidates Below Resistance At $1,644/oz

Today’s AM fix was USD 1,624.00, EUR 1,308.94, and GBP 1,030.26 per ounce.
Yesterday’s AM fix was USD 1,615.25, EUR 1,306.84 and GBP 1,028.04 per ounce.

Silver is trading at $28.95/oz, €22.40/oz and £18.44/oz. Platinum is trading at $1,495.75/oz, palladium at $604.70/oz and rhodium at $1,025/oz.

Gold rose $4.80 or 0.3% in New York yesterday and closed at $1,620.70/oz – its highest level in three months (since June 19). Silver dropped than rallied back to $28.83 ending the day with a gain of 2.64%.

Gold Spot $/oz and 200 Day Moving Average –  August 2009 to Today – (Bloomberg)

Gold continues to be supported by the real risk of EMU break up and further weakness in the euro, dollar and other currencies. Gold continues to consolidate below its 200 day moving average at $1,644/oz. 

Technically, gold needs to close above the 200 DMA. Should this happen we could see quite significant short covering and more speculative elements on the COMEX may sense blood and come in on the long side in a more aggressive manner thereby propelling gold well above its recent trading range.

Platinum hovered just above the 2 month high hit on Monday over supply concerns from South Africa.  Lonmin is the world’s number three producer and accounts for 12% of global platinum output. Industrial unrest has spread to other platinum mines in South Africa which produces between 70% and 85% of the world’s platinum (different estimates).

44 people died after violence and a massacre at Lonmin’s Marikana mine, and the company is now waiting before firing the 3,000 workers as previously planned, as the mine owners realized it would escalate the situation.

Gold bullion prices inched up despite trading volume for US gold futures being on track to hit a 2012 low. Silver surged almost 3% and there was speculation that platinum’s rally may have made some of the silver shorts close some of their massive concentrated short positions. 

Platinum has surged 7% in the last 3 sessions bringing its year to date gain to 7% outperforming gold and silver so far in 2012.

Russia continues to accumulate gold in its large foreign exchange reserves. The reserves include monetary gold, special drawing rights, reserve position at the IMF and foreign exchange.

Russia’s central bank increased its gold holdings to 30.1 million troy ounces as of August  1st, from 29.5 million troy ounces a month earlier, according to a statement published on its website today.

The gold reserves were valued at $48.7 billion at the end of last month, Bank of Russia said in a statement.

Russia’s gold and foreign exchange reserves rose to $510.0 billion in the week to August 10 from $507.4 billion a week earlier, central bank data showed last Thursday.  Russia’s gold and foreign exchange reserves were $498.6 billion at the end of 2011.

This means that Russia now nearly has some 10% of its foreign exchange reserves in gold bullion. 

Russia’s Gold Holdings From 1993 to June 2012 – (Bloomberg)

Since 2006, Russia has been gradually accumulating gold in order to diversify and protect from devaluation of their dollar and euro foreign exchange reserves and as part of a long term plan to position the Russian rouble as an international reserve currency.         

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(Bloomberg) – Silver Imports By China In July Rise To 272 Tons
Silver imports by China were 272 metric tons in July, according to data released by the customs agency today. That compares with 223 tons in June. Platinum imports were 7.4 tons in July, compared with 6.1 tons a month earlier, data showed. Palladium imports were 1.97 tons, data showed.

(Bloomberg) — IShares Silver Trust Holdings Unchanged at 9,733 Metric Tons 
Silver holdings in the IShares Silver Trust, the biggest exchange-traded fund backed by silver, were unchanged at 9,733.39 metric tons as of Aug. 20, according to figures on the company’s website.


                  Aug. 20    Aug. 17    Aug. 16    Aug. 15    Aug. 14    Aug. 13

                     2012       2012       2012       2012       2012       2012


Million Ounces    312.936    312.936    312.936    312.936    311.579    313.226

 Daily change           0          0          0  1,356,958 -1,647,762          0


Metric tons      9,733.39   9,733.39   9,733.39   9,733.39   9,691.18   9,742.43

 Daily change        0.00       0.00       0.00      42.21     -51.25       0.00

================================================================================NOTE: Ounces are troy ounces.

(Bloomberg) –Bear Market In Tin Risks Global Shortage
Indonesia idled about 70 percent of tin-smelting capacity in its biggest producing region amid a three-month bear market, curbing the world’s biggest exports and setting the stage for a global shortage.

Cross Currency Table – (Bloomberg)

Gold futures settle at highest since June – MarketWatch

Platinum hits 2-month high on South Africa supply fear – Reuters

Platinum Climbs to Six-Week High; Gold Gains as SPDR Assets Jump – Bloomberg

Low demand, high cost: platinum industry in for tough times – MSN

US drought will lead to inflation and higher food prices, says report – The Guardian

Is Apple Really Worth More Than The Sum Of Microsoft, Dell, Google, Facebook And HP? – Zero Hedge

Embry – Apple, Gold, Manipulation & Financial Implosion – King World News

Watch Out For A Silver Breakout Higher – Max Keiser

Keiser Report: Consumption-tration Camps – Max Keiser

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