Surge In Gold Coin Sales Since Start Of Month

Positive manufacturing numbers out of China this morning have encouraged buying of growth assets, with commodities and stocks strengthening, alongside the euro, which has moved back above the USD 1.30 mark. News that the Greek government has announced details of a 10 billion-euro bond buyback programme – scheduled to take place this Friday – as part of conditions set to receive its next allotment of financial aid has also helped the euro.

Precious metals have been flat since the start of trading today. $1,750 remains a key point of overheard resistance for gold, with support around $1,710. Silver faces selloffs on every run towards $35 – reemphasising the technical significance of this price – though appears to have decent buying support on any dips towards $33. Incremental progress (recall that not long ago, $33 was a point of overhead resistance for silver), and setting us up nicely for the next silver price surge.

Interestingly, as the chart below from the US Mint makes clear, demand for American Eagle gold coins has surged since the start of the month. More and more Americans are waking up to the serious fiscal imbalances affecting government at home and all over the developed world, as well as the serious risk that the Federal Reserve’s perpetual quantitative easing poses to the dollar.


The Fed is said to be considering an expansion of its current asset purchases ($40bn of mortgage-backed securities as month, plus $45bn of “Operation Twist” purchases). The reason? Operation Twist relies on selling short-dated Treasuries in exchange for long-term Treasuries, but the Fed’s stock of short-term paper is dwindling, meaning that new purchases will have to be financed by more money printing.

The Fed’s next policy meeting on December 11-12 may provide some answers, and yet more support for precious metal bulls.