Gold & Silver Prices – Daily Outlook September 29

Gold and silver prices shifted to red again yesterday after they had regained some value a day earlier. Currently, gold and silver prices are traded up. The German Parliament approved the expansion of the European bailout fund that could ease the uncertainty in the financial markets over the stability of the Euro Area.  Today, the U.S. Unemployment Claims report will be published, U.S. pending Home Sales and US GDP 2Q 2011 Estimate. 

 Here is a market outlook of precious metals prices for today, September 29th:

Gold and Silver Prices –September

Gold and silver prices shifted to red and decreased yesterday: Gold price shed on Wednesday 2.08% to its value to $1,618; silver price sharply decreased by 4.45% to $30.13. During September, gold price fell by 11.4% and silver price decreased by 27.9%. The chart below shows the development of gold and silver prices during September (normalized gold and silver prices (August 31st 2011=100)).


Gold price forecast & silver prices outlook 2011 September 29

The ratio between gold and silver prices slightly inclined on Wednesday, September 28th to 53.70. During September, silver price declined by a much higher rate than gold price as the ratio increased by 22.5%.


Ratio Gold price forecast & silver prices outlook 2011 September 29

The recent shifts in gold and silver prices brought the volatility of these commodities to record levels: the standard deviation of the daily percent changes of gold and silver prices reached the highest levels in 2011. These findings just show how hard it will be to determine the direction of precious metals direction.


Standard deviation Gold price forecast & silver price outlook 2011 September 29

On Today’s Agenda:

Germany voted today and approved on a bailout plan for Greece that includes raising the German guarantees for the EFSF fund from €123 billion to €211 billion;

U.S. Unemployment Claims: For the week of September 17th, initial claims fell by 9,000 to 423,000 claims; 

Final US GDP 2Q 2011 Report: This report is the final estimate of the second quarter 2011 real GDP of US. In the preliminary estimates the 2Q2011 GDP growth rate was 1.0%, compared with 0.4% increase at 1Q2011 (for the second estimate of 2Q GDP).

U.S. Pending Home Sales: This report will be another indicator for the economic progress in the U.S. housing market in the U.S. and could affect traders not only in the stock market, but also in commodities markets;

US Dollar / Gold & Silver Prices – September Update

The EURO/USD exchange rate along with other exchange rates changed direction and fell yesterday: the Euro to USD fell by 0.31% to reach 1.3543; the AUD/USD shed 1.34% to its value; the USD/CAD increased by 1.39%. The drop of major currencies against the USD might be related to the ongoing concerns over the affects of a Greek default.

U.S. Treasuries / Gold Price – September Update

The US 10-year Treasury yield inclined again by 0.03 percent points to 2.03% – the highest rate since September 20th; during September it has fallen by 0.20 percent points. The rise in LT securities’ yields in recent days represents a shift in the direction of yields in recent months. The negative correlation between the US long term Treasury yields and gold price daily percent changes (in September the correlation was -0.217), mainly in recent days suggest that traders are moving away from the shopping spree of safe haven investments as traders did in August.  If this trend will continue, it may keep gold price low in the near future.

Chart Gold Price and 10 Yr Daily Treasury Yield September 2011 September 29

Current Gold and Silver Prices

The precious metals prices are currently traded up in the European markets:

Current gold price short term future (October 2011 delivery) is traded at $1,631.6 per t oz. a $13.5 or 0.83% increase as of 09:40*.

Current silver price short term future is at $31.2 per t oz – a $1.066 or 3.54% incline as of 09:39*.

The current ratio of gold to silver prices is at 52.27.

(* GMT)

Gold and Silver Prices Outlook:

Gold and silver prices changed direction again and sharply fell yesterday. The recent trend in the financial markets seems that traders are pushing away from the safe haven investments including the US treasuries bills and precious metals. On the other hand the stock markets are also not performing well. This situation might suggest that the market is still in a level of high uncertainty especially in regards to the next steps of the policymakers in Europe and the economic progress of the US. Today’s US home report may have some effect on trading. In the meantime, gold and silver prices are likely to continue zigzagging and perhaps slightly rising in the next couple of days of the month.

Here is a reminder of the top events and reports that are planed for today (all times GMT):


13:30 –U.S. Unemployment Claims

13:30 – Final US GDP 2Q 2011 Report

15:00 – U.S. pending Home Sales

15:30 – EIA report on US Natural Gas Market


10.00 – Euro Area Annual Inflation (September)

13:30 – Canada GDP by Industry


For further reading:

Lior Cohen, M.A. commodities analyst and blogger at Trading NRG.