Gold And Silver’s Ascent Pauses: Will Prices Crash?

By Mike Gleason

Welcome to this week’s Market Wrap Podcast, I’m Mike Gleason

Coming up we’ll hear part two of the recent interview Money Metals President Stefan Gleason did with Pete Fetig during the 360 Gold Summit. Stefan gives some important warnings to precious metals investors, discusses why he favors one of the precious metals over the others and also talks about some absolutely critical things to consider when selecting a precious metals dealer. Don’t miss the fantastic conclusion of Stefan’s interview, coming up after this week’s market update.

Precious metals markets cooled off a bit this week after a red hot start to the summer led to some Independence Day fireworks in the silver market. While U.S. exchanges were closed on July 4th, silver shot up in overseas trading, carrying prices briefly above $21 per ounce.

The silver market has since settled back down. As of this Friday morning recording, silver trades at $19.86 an ounce, essentially flat for the week. Gold is faring slightly better, posting a 1.0% weekly advance to trade at $1,356 per ounce.

Checking in with platinum, the catalytic metal closed at a new high for the year on Thursday at $1,094 an ounce. Platinum is down slightly Friday with prices currently coming in at $1,087, good for a 2.3% gain on the week.

The long-term outlook for precious metals remains solidly bullish, even as institutional bears try desperately to engineer a takedown. Big commercial traders are positioned heavily on the short side in the futures markets. And on Thursday, the Intercontinental Exchange clearinghouse for commodity markets raised margin requirements on gold and silver. This will force funds that hold leveraged long positions in gold and silver contracts to raise cash or liquidate some of their positions.

Futures markets overseers say that raising margin requirements is sometimes necessary to deter excess speculation after a market has experienced a big run in one direction or another. Back in 2011, interventions to increase margin requirements helped kill the gold and silver bull markets.

from http://seekingalpha.com/