Market Update 26 Jul 2013: Gold Stock Rally Continues


Most markets were sharply lower this week; the exceptions were bitcoin, gold stocks, and silver. Most significant was the rise in the HUI gold stock index, which climbed all the way to 6.1 g before closing at 6.0 g, 15% above its recent low.

The government-issued currencies were all weaker, led by the USD, which declined another 2.6% to 23.4 mg, leaving it 49.4% above its half-life curve. The CAD and EUR were the least weak, losing 1.6% and 1.8% respectively. Bitcoin stabilized this week, climbing 2.1% to close at 2.25 g. Trading was very quiet, with only 30 kg worth of BTC changing hands – a far cry from the 535 kg we saw during the Cyprus banking crisis last April.

Bonds were lower, with the short term SHY losing 2.6%, in sync with the underlying USD, while the long term TLT fell 3.6% to close at 2.53 g, just below support at 2.55 g. This is a crucial point for TLT, as it sits both at a long-term support/resistance level, and at the bottom of its upward trending channel.

Long Term Treasuries

Most stocks declined again, with the Nikkei down 5.5% and the S&P 500 off 2.7%. The HUI Gold Bugs Index was the only equity advancer, adding another 3.6% to close at 5.98 g. This extends the rally to resistance between 6 and 6.25. If the HUI can clear this hurdle, the next stop is long term resistance at 6.8.

HUI Gold Stocks Chart

Silver was the only commodity that didn't fall this week, adding 0.4% to close at 0.47 g/oz, little changed. Crude oil led the decliners, falling 5.7%, followed by cotton and copper, each down 3.9%. Platinum dropped 2.2% to close at 33.4 g/oz, now 7.3% above gold parity.

Table of prices in gold for week ending 26-Jul-2013

Comments on Market Update 26 Jul 2013: Gold Stock Rally Continues Leave a Comment

July 28, 2013

Alex @ 11:23 pm #

Sir Charles, sorry but I don't understand how you know the amount of Gold (in KG) that trades relative to BitCoin.

As I understand your prices, for everything, not just BitCoin, all you do is take the curent price of Gold and the current price of whatever (BitCoin, Oil, Cotton) and then divide one by the other. Therefore it's impossible to say how much Gold trades versus the other market.

Where am I going wrong? Thanks, and loving your work!

July 29, 2013
July 31, 2013

Joe @ 7:00 am #

Just found out Yamana Gold (part of HUI index) is delisted in LSE for cost cutting purposes. I stupidly opened my letter too late, now my shares are now stuck in my portfolio. 🙁

Good job I didn't invest a lot and I only bought them couple months ago. Hopefully, gold price/stock pick up in the near future and Yamana will relist in LSE.

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