Written Commentary
GOLD / SILVER
The path of least resistance in gold and silver remains down this morning, with gold and silver prices continuing to diverge. However, the initial action today seems to counter classic/recent fundamental action in the precious metals markets, with gold managing gains and silver soft in the face of strength in the dollar and risk on sentiment flowing from equities.
PALLADIUM / PLATINUM
In a slight change of pace, the palladium market recovered against platinum in a move that was obviously inspired by “risk on” psychology flowing from equities. It should also be noted that palladium ETFs yesterday saw a massive inflow of 10,676 ounces for a daily increase in overall holdings of 1.9%, which in turn puts the year-to-date gain in holdings at +12%. The palladium and platinum markets could be supported because of news that Russian companies are beginning to sign long-term supply contracts with Nornickel’s palladium fund as that could hold supply inside Russia and leave the rest of the world tight.
COPPER
While the copper market is trading higher this morning and is waffling around its 200-day moving average of $4.3160, it is difficult to rationalize an upward track in prices today without something distinctly positive from the US jobs front. In fact, the market has seen very disappointing Chinese services PMI data from China, Europe, and the UK overnight which should create demand fear.
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