Mining’s old guard needs strong medicine
A new report details subpar investor returns in the mining industry over the last decade, particularly big cap diversified companies which have not adapted to new realities.
The “Gold & Precious Metals Report” is only a brief summary of the fundamental and technical developments that I see in the market. In the changing market place that we are involved in, sentiments can amended as new developments arise. Clients and subscribers enjoy full access to my services including; trade recommendations, fundamental and technical analysis, order execution, risk management.
December Gold settles 1780.5 up $26.40
December Gold posted a rally back up to the 1780 level Thursday buoyed by data from the EU and more importantly China. Data released today on the U.S. economy was mixed however with jobless claims falling more than forecasted while a reading on GDP came in much weaker than expected.
Chinese stocks rebounded from multi year lows amid speculation the government would announce steps to support the slowing markets that could include more changes to initial public reforms. China’s central bank made a $57.9 billion injection into money markets this week, the largest in history.
China is the world’s number one consumer and producer of Gold, so additional stimulus from their central bank will be seen as supportive for the precious metals in my view. In Europe shares ended higher probably due to Spain’s budget decision to cut spending rather than raise taxes. Spain also said it will tap 3 billion euros from the social security reserve to cover liquidity needs.
This news was largely responsible for putting a temporary bottom in the Euro which caused the Dollar to trade lower. Outside markets were sharply higher as well with the S&P and Dow higher along with Crude Oil trading over two dollars a barrel higher near the close.
The news out of China was the fifth new or extended stimulus measure in the last month or so announced by Central banks around the globe. With interest rates at historic lows combined with the perception that the Chinese economy will expand due to stimulus measures from their Central Bank, it should be no surprise that Gold traded back to near six month highs this morning.
Tomorrow ends the month and quarter and it is light on economic releases from the U.S. with only a consumer sentiment reading, and a Chicago PMI number.
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Daily Swing #s GCZ2
Resistance#2-1801.9
Resistance#1-1791.2
Pivot 1772.2
Support#1 1761.5
Support#2 1742.5
Sean Lusk
Gold & Precious Metals Analyst
Direct: 312-765-7213
