Ira Epstein’s Weekly Metal Report


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It seems to me that the writing of this report has become repetitive. I say this because the forces that drive Gold prices haven’t changed.
• Iran…embargo going forward July 1st
• Sovereign debt issues in Europe
• China having a “hard” landing
• New…Egypt having an Islamist President
Gold is trading about where it finished last year at. Obviously this means that on a close to close basis it hasn’t moved very much in the first half of 2012. It might not in the second half either. Yes, there have been rallies, but as gold bulls know they haven’t held.
The Eurocurrency has serious issues and I don’t see those issues being quickly resolved, so that removes one of gold’s props. As the Euro has fallen in value, the US Dollar has been rising. As the Dollar rises, gold in terms of the Eurocurrency costs more. India, a traditionally major consumer of gold is having the same issue. It’s Rupee has lost a lot of value against the Dollar this year. China seems to be the bright spot as the Chinese public is picking up the slack from the loss of India’s consumption.
I just read reports that central banks as a whole have not been adding to their gold reserves. Just as important, as a group they haven’t been selling their reserves in these rough economic times.
Seasonally speaking, gold leaves the current “weak” seasonal time frame it’s now in and begins, historically speaking, to gather strength into year end. Will this year follow the seasonal pattern is the question only the market can answer. Keep July 26th in mind, as the close that day becomes to me a “key” day.
The close of July 26th is the number I use as the pivot if gold is to be declared a bull market in the second part of the year. While gains and losses in-between the July 26th date and the close of this year will vacillate, this price becomes to me very  important in terms of determining if seasonality is working or not. I also use this price to watch for relative strength or weakness going into year end.
More important, I am looking for buy signal now for the first time in a long time assuming the seasonality takes hold. I also like the setup of the charts going into July. The potential is there, but what’s missing has been a story to get the public involved. Given all the above events, I don’t know what that story

The chart below is published with permission of the Moore Research Center, Inc.
For simplicity purposes, I have published below the 15 and 30-year seasonal patterns. As you can see, they are very similar and show that gold prices tend to decline into July.



….read more and view 4 more charts and summary HERE