Written Commentary
GOLD / SILVER
Clearly, gold and silver have broken the inverse chain with the dollar as the dollar has exploded to a fresh contract high again overnight and yet gold has also exploded to the upside. Obviously, the double shot of hotter than expected US inflation measures this week has ignited a long sleeping inflation contingent in the precious metal markets. Heretofore, inflation fears were factored into currencies, crypto currencies, crude oil, and treasuries instead of gold and silver as was the case in the 80’s.
PALLADIUM / PLATINUM
While the PGM markets has seen minimal spillover buying interest from the significant rallies in gold and silver prices this week, we suspect the action in gold and silver combined with hot inflation readings has simply discouraged sellers of palladium and platinum. The bull camp should be emboldened by news that South African PGM output in September declined by 7.5% versus year ago levels as expectations for demand improvement remain suspect.
COPPER
There are several overnight developments that have lent fresh support to copper prices in the early going today and they include word that Evergrande has made another interest payment, Russian posted lower January through September copper exports and there was another decline in daily LME copper warehouse stocks. LME warehouse stocks have continued to decline with the decline today, LME stocks have declined in 37 of the last 39 sessions and when combined with Shanghai copper stocks, global exchange stocks have declined to 13-year lows.
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.
