GOLD / SILVER
It would appear as if the precious metals complex is assuming a physical commodity market stance this morning as an escalation of economic uncertainty (virus fears and sharp equity market declines) is being discounted in favor of fears of deflation/physical demand slowing. It would seem as if the fear of a 2nd wave of virus is a widely dispersed geographic threat which appears to have stoked selling interest in gold and silver.
With a breakout down this morning following tight coiling last week the bear has to feel confident in pressing the short side. While Chinese Industrial production was worse than expected, that negative impact on palladium was balanced by the fact that the data was in positive territory and in some cases was better than the prior month. Nonetheless the big pressure for palladium today is from the fear of resurgent virus numbers as a second wave of global Shutdown could easily send September Palladium down below $1,750.
As in other metals and physical commodities the copper market has damaged its charts this morning and appears to be facing a renewal of demand destruction fears from the virus front. Adding into the negative track this morning is a large 12,000 ton inflow to LME copper warehouse stocks.
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