Mid-Day Gold & Silver Market Report – 1/11/2013

GOLD CONFIDENCE MAY BE RETURNING; EQUITIES STILL HOT

We made it through the first round of debt ceiling talks, and now earning season is upon us. Soon we will have a clearer landscape for how the rest of the quarter and the year should look. Chuck Butler, president of EverBank World Markets said, “Once the landscape for those things can be laid out, the market will then have a clear direction. That direction most likely will include kicking the can down the road for the U.S., which would potentially drive the dollar down further, which would be good for Gold.” Gold has a negative correlation to the U.S. dollar and is viewed as a safe-haven asset.

The equities market is still growing; last week money flowed back into stock-based mutual funds at a pace we haven’t seen in more than four year. Volatility measures tell us that there is almost no fear in the market. The most recent American Association of Individual Investors survey came in with a 46.4 percent bullish reading, those expecting the market to be lower in six months fell to 26.9 percent. Why all the positive momentum?  Successfully surviving the “fiscal cliff” seems to be a good enough reason for now.

At 1:25 p.m. (EST), the APMEX Precious Metals spot prices were:

• Gold, $1,660.50, Down $19.50.
• Silver, $30.44, Down $0.52.
• Platinum, $1,632.10, Down $2.20.
• Palladium, $704.80, Up $1.60.

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