Written Commentary
GOLD / SILVER
We suspect that part of the recovery bounce in gold and silver prices this morning is the result of short covering from yesterday’s large range down, with additional lift coming from an 8-day low in the dollar index. Holding back the gold and silver trade are unrelenting forecasts of recession based on yield curve signals. Another minor impediment to higher gold prices today is a decline in ETF holdings yesterday of 81,022 ounces which pulls down the year-to-date gain to 8%.
PALLADIUM / PLATINUM
What the Ukraine situation gave to the palladium bulls over the past two months was partially extracted yesterday with the palladium market extending the downside breakout to a startling $600 an ounce below the early March high! While the sanctions initially focused on energy supply flow from Russia, the complete shutdown of PGM trade has probably not occurred as clearing houses in Switzerland and other countries likely sped up imports as talk of sanctioning PGM’s gathered momentum.
COPPER
With copper prices tracking higher this morning in the face of a large daily build in LME copper warehouse stocks, the trade remains hopeful that peace talks will offer some progress toward ending the war. Indirect support today for copper is seen from higher nickel price action, but the market is also drafting support from a shift in copper purchasing channels.
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