Prices and Charts
NZD Gold Consolidates Above $5000
Gold in New Zealand dollars was down $22 from a week ago to $5125. Earlier today it dipped down below $5100. So it continues to consolidate above the green uptrend line dating back 2 years ago. Buy zones to watch out for remain $5000 and then the 50 day moving average and the blue uptrend line at around $4900. But just don’t count on seeing those last two. Because we might only see a retest of the breakout from the green uptrend line.
While in USD gold was down $7 to $2926. Not far above our first buying zone at $2900. Then below that would be $2800 and $2700. Again just don’t count on it. Because while all this gold keeps being hoovered up in London and shipped to the USA, there’s a good chance any dips will be shallow and brief.
Silver Pullback – Buying Opportunity Here?
NZD silver was down $2.19 or 3.8% from 7 days prior to $55.70. Dipping down once again towards the green downtrend line. Also not far from the 50 day MA. So we are entering what could prove to be a very good buying zone here. It still looks like silver is building to break out above $58. Then once that happens the next stop is the all time high above $60.
USD silver was down $1.18 to $31.80. It’s now not too far from the key 200 day MA. That would be a major buying zone if it got down to there. However maybe don’t be too cheeky as these levels already look pretty good. But once we get a definite break of $33 we are likely heading to $35.
NZ Dollar Holding Steady
The Kiwi dollar was up12 basis points from last week to 0.5709. Holding steady but looks like it is on the way to test the overhead resistance line above 0.5800.
Need Help Understanding the Charts?
Check out this post if any of the terms we use when discussing the gold, silver and NZ Dollar charts are unknown to you:
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Legal Tender Gold and Silver Coins: Worth the Investment?
In this week’s feature article, we dig down into legal tender gold and silver coins. These coins, issued by government mints, carry a face value and are recognized as legal tender. However, their market worth is primarily determined by their precious metal content, usually significantly exceeding the stamped face value. We discuss the benefits of such coins, including their global recognition and other advantages. Then finally see how the current premiums over spot prices are at levels we haven’t seen before and what this means to you.
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Gold Silver Ratio Highest Since August
Despite the current dip in silver we think it looks like a pretty good buying zone.Another thing pointing to this is the gold to silver ratio getting above 91. Its highest level since last August. It is also hitting the top of this wedge formation which it has turned down from multiple times over the past 3 years.
This means it now takes 91 ounces of silver to buy an ounce of gold. We expect this to drop lower in the not too distant future. Initial target remains 60.
Here’s What Could “Lower” Inflation in NZ
A headline we read this week points to a way that we may see lower inflation levels in NZ. We’ll, reported levels at least anyway:
“The Reserve Bank worries the Consumers’ Price Index (CPI) may not accurately reflect the level of inflation in the economy, as the basket hasn’t been fully updated since 2020.”
Source.
The RBNZ is calling for an update to what is reported in the CPI along with it being monthly rather than quarterly. With RBNZ head Adrian Orr saying:
“We keep talking about the frequency, but also the rebasing. Our consumer price index hasn’t been re-based … You know, a laptop always costs $2,000, but what you get in that laptop has changed beyond belief”.
What he is referring to here are what is known as “hedonic adjustments”. This is where they adjust the CPI for the items that improve in quality but keep the same price. But of course you still have to pay the same price! However they adjust down the actual price reported in the CPI. There are other things that also happen like substitutions. When something gets too expensive, say eye fillet Steak, they theorise that people buy a cheaper product. So the substitute the cheaper product into the CPI basket.
More on other issues with the CPI can be seen here: Comparing NZ Money Supply, Government Inflation Statistics, Property Prices, and Gold Prices for the Last 24 Years
Great to have more regular timely data for sure. You’ll get no argument from us there. However this sounds suspiciously like we’ll see the CPI adjusted lower in the future.
Audit Fort Knox?
You’ve likely heard the calls being made to audit Fort Knox. Hopefully if this goes ahead they’ll audit all the US gold, not just those reserves held at Fort Knox. Also they’ll need to check if the gold has been leased out. Could this rehypothecated gold be part of the reason for all the gold heading to the USA? More on this next week.
Gold About to Seriously Outperform Stocks – Just like 1971?
Ronni Stoeferle reports:
History doesn’t repeat, but it sure does rhyme…
A crucial inflection point may be unfolding in financial markets: Is the S&P 500 rolling over versus gold, just like in 1971?
This chart, shared by Mike McGlone of Bloomberg Intelligence, highlights a striking resemblance between today’s S&P 500 to Gold ratio and the early 1970s. Back then, a seismic shift occurred—the Nixon Shock ended the gold standard, triggering a massive revaluation of gold and ushering in a new monetary era.
💡 Fast forward to today: Could we be witnessing another historic transition?
🔸 The Setup: The SPX/Gold ratio appears to be rolling over, suggesting a potential shift in relative performance.
🔸 The Implications: Gold could outperform in one of two ways:
1️⃣ Gold surges faster and further than equities.
2️⃣ Stocks decline while gold holds steady—or both!
With central banks aggressively stockpiling gold, persistent inflation concerns, and rising geopolitical uncertainty, the pieces are falling into place for gold to reclaim its monetary dominance in the global financial system.
Is Gold about to have its moment once again? What do you think?
Swiss Banker Agrees With Us: Retail Gold Investors Have Got it Wrong
Retired Swiss Private Banker Clive Thompson had some interesting stats in a post this week on LinkedIn.
He had many similar points to those we made a couple weeks ago:The Two-Tiered Gold Market: Why Central Banks Are Hoarding Gold While Retail Investors Sell Theirs
“The big-boys (large investors in the “know”) are hoovering up gold.
Retail Investors are showing almost zero interest in Gold. In fact they are net sellers. Despite selling by moms and pops the price keeps rising.”
…Conclusion: Small investors see the rise in the gold price as an opportunity to sell.
Small investors are selling their coins and bars.
Gold ETFs are net sellers of gold.
Deliveries of 100oz bars is at a record level.
We don-t know who is buying all those large bars.
Whoever it is has very deep pockets. They are driving the gold price higher.
Here are a few numbers for you to ponder:
Total world gold reserves: 36213 tons
Gold held by the USA: 8133 tons
Gold held by China: 2280 tons
Central Bank gold purchases in 2023: 1037 tons
Central Bank gold purchases in 2024: 1082 tons
Gold held by the LBMA: 8534 tons (-400 tons in 2 months)
Gold held in COMEX warehouses in NY: 1207 tons (+636 tons)
Comex Gold Delivery Notices for Feb 2025: 233 tons
Gold transferred from London to Comex in recent weeks: 393 tons
Gold mined annually: 3646 tons (2023 figure)
Gold held by ETFs: 3253 tons (-600 tons in 2 years)
Retail investors have got it wrong again, as usual. They are selling cheap gold to buy expensive stocks.
The bull run in gold is just getting started. Mom and Pop can’t see it yet. They will, maybe when gold gets to $4000 or $5000. They’d much rather chase the tail-end of a 15 year-old equity bull market.”
So don’t be late to the precious metals party as it seems many people will be.
Please get in contact for a gold or silver quote, or if you have any questions:
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