GOLD / SILVER
The upward march in gold and silver continues with overnight gains more measured than what was seen in the prior session. While it is unclear what the primary driving force is for the bull camp, US infections continue to surge and inflows to ETF’s have extended once again. Yesterday gold ETF’s saw an inflow of 197,890 ounces bringing net purchases to date up to 21.3 million ounces ($40 billion). Yesterday’s inflow put total gold held by ETF’s up 26% this year to a total of 104.2 million ounces.
PLATINUM / PALLADIUM
While the palladium market this morning is showing signs of following gold, silver and platinum higher (with a 20-day high) we doubt the market has the story line and the trading volume to mount the type of gains expected in other precious metals markets. However, with the net spec and fund long in palladium virtually zero recently, one would think the market would have a moderate amount of speculative buying capacity. As we indicated yesterday, we think platinum is beginning to link itself tightly to the gold market with some traders/investors viewing platinum as a much cheaper long entry into a flight to quality/inflation instrument.
With a massive range up extension in September copper this morning, it would appear as if the trade is on a mission to make new highs for the year with a move above the $2.90 level. While a large portion of the buying in copper is attributed to the ongoing belief of strengthening Chinese copper demand, the fear of lost production from Chile and very material daily declines in LME copper warehouse stocks gives the bull camp a broad bullish argument.
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