January Ends With Gold and Silver Up the Most

After suffering through what could best be described as ‘the best of times and the worst of times’ in 2011, Silver has had one whale of a January.  The white metal gained nearly 20% in the first month of 2012 closing at $33.13 on Tuesday.  So strong has the rally been for Silver in 2012 that the 50 day moving average is now positively sloped.  Volume has returned to the silver pits at the COMEX as well, after a 4th quarter where buyers could not be found and brutal intra-day sell offs were the norm.

Tuesday marked the only time in January that Silver put in two consecutive down days in a row.  What is even more impressive is that most of the gains for the month have held through the delivery period for the February contract which ended last Wednesday.  This is in sharp contrast to the behavior in December where the last day of the January contract was the last time the bears were able to induce a waterfall decline in price, a sure sign that someone (*cough* JPMorgan *cough*) needed to wipe out any bulls who were intended to stand for delivery in 2011 (*cough* Eric Sprott *cough*).

Oh, yeah, Gold did pretty well in January also.   It was up a mere 11.2% for the month, buoyed by Ben Bernanke’s grand plan to target inflation (*cough* QE to infinity *cough*) and a return of sanity to the trading pits as the new year allowed new players to begin building positions.

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Tom Luongo

About Tom Luongo

Tom Luongo is a professional chemist and self-taught economist who has been following and trading stocks for nearly 12 years. He has no formal ties to the financial industry and considers that an asset in his analysis of the interplay between monetary policy and capital markets.

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