GOLD / SILVER
Starting the holiday shortened trading week the December gold contract appears to be vulnerable from a chart perspective with the recent pattern of lower highs extending this morning. With a slightly higher US dollar, occasional positive correlation with equities and comments from the White House suggesting a vaccine next month, that provides a negative backdrop for gold today. Unfortunately for silver bulls silver ETF holdings were reduced by 4.1 million ounces for 3rd straight day of declines! With gold prices in India trading lower and that price action extending into the early US trading session we would not rule out the potential for a 6-day low in gold early today. Another minor negative for gold and silver prices today is the fact that platinum is getting a significant amount of bullish news and forecasts for deficits and that could cause some precious metals capital investment to move to the PGM space from gold.
PLATINUM / PALLADIUM
While the palladium market is showing early corrective action today the charts recently have shifted bullish and it is possible that the market will continue to derive support from the progressive improvement in views toward the Chinese economy. Furthermore, it is possible that palladium will see some spillover lift from platinum which has received a significant amount of bullish fundamental news and higher price forecasts. While the charts in platinum are not overly impressive the market has posted a 3-day high extending the bounce from late last week. Certainly, the platinum market is deriving lift from a World Platinum Investment Counsel prediction of a world deficit this year.
While the new high in December copper overnight was not notably above the high last Friday and that move failed to usurp the contract high from early last week, the charts to start the trading week are bullish. In fact, on last week’s rally open interest in copper increased and favorable Chinese economic news over the last several sessions provides added lift. However increased trade tensions between the US and China are a limiting force and Chinese overall imports for August contracted with some reports of a surplus of internal commodity inventories. While copper is also seeing initial pressure from strength in the dollar that outside market force has not been a significant influence on prices.
Risk Warning: Investments in Equities, Contracts for Difference (CFDs) in any instrument, Futures, Options, Derivatives and Foreign Exchange can fluctuate in value. Investors should therefore be aware that they may not realise the initial amount invested and may incur additional liabilities. These investments may be subject to above average financial risk of loss. Investors should consider their financial circumstances, investment experience and if it is appropriate to invest. If necessary, seek independent financial advice.
ADM Investor Services International Limited, registered in England No. 2547805, is authorised and regulated by the Financial Conduct Authority [FRN 148474] and is a member of the London Stock Exchange. Registered office: 3rd Floor, The Minster Building, 21 Mincing Lane, London EC3R 7AG.
A subsidiary of Archer Daniels Midland Company.
© 2021 ADM Investor Services International Limited.
Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. The information and comments contained herein is provided by ADMIS and in no way should be construed to be information provided by ADM. The author of this report did not have a financial interest in any of the contracts discussed in this report at the time the report was prepared. The information provided is designed to assist in your analysis and evaluation of the futures and options markets. However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to ADMIS. Copyright ADM Investor Services, Inc.