Friday The 13th
The numbers are in. They ain't pretty, but they ain't as ugly as we'd anticipated either. They can dice em and slice em any way they want in the financial media. These numbers are bad for the US Dollar. The dollar was getting taken to to the woodshed overnight in Europe following European Central Bank president Jean-Claude Trichet yesterday signaling that ECB would be rising in the near future.
Mysteriously, the US Trade Balance did not com in over estimate -58.44 vs -60.50 consensus. The rising price of oil last month alone should have pushed that number well above consensus. They probably booked some airplane sales to some foreign nationals to keep that number in line...an infamous trick of the government data crunchers. Yet it would be a huge stretch to intimate that this trade number is a positive. In fact, in the big picture, it's hugely negative. "Today's February US trade deficit, in combination with last Wednesdays release of a wider-than-expected fiscal shortfall ... in March will remind investors that the 'US twin deficit' problem will come back as the US economy weakens, undermining tax revenues," BNP Paribas analysts said. The key quote there, ...undermining tax revenues.
The PPI numbers 1% vs. .6% consensus, prove inflation is picking up steam, and that it's root cause is rising food and energy prices. Core PPI, ex food and energy came in at zero. I find that somewhat astonishing, "zero", but those are the numbers. Inflation IS a lot worse than the Fed wants you to believe, because they are mandated to control it AND because they are the root cause of it.
At the end of the day this new economic data should prove to be US Dollar negative and very good for the Precious Metals. If you're not on the bus already, start running now or you may may be left behind waving. There may be a couple more stops before we hit the highway. This bus is heading for Cape Kennedy and a moon launch. Intersections at (spot) 14.43 Silver and 691 Gold may be your last chance to get on board.
Silver Resistance: 13.95 / 14.04 / 14.12
Silver Support: 13.85 / 13.78 / 13.67
Gold Resistance: 681 / 686 / 691
Gold Support: 677 / 674 / 670