Written Commentary
PLATINUM / PALLADIUM
Clearly, favorable US data has not helped support platinum as a rebound in US total vehicle sales from July to August was seemingly ignored by the trade. Certainly, platinum is dramatically oversold with a net spec and fund positioning likely approaching “flat” but without relief from financial market spillover pressure, cheap pricing probably won’t attract buyers.
GOLD / SILVER
While the gold and silver markets have managed to respect yesterday’s spike low, classic fundamentals remain bearish with the best hope of bottoming action coming from significantly oversold technical conditions. The interest rate impact on gold and silver looks to remain definitively bearish and could expand rather than level out. Yesterday the 10-year treasury yield reached the highest level since the 2007 financial crisis and the dollar reached the highest level since November 28th, 2022, both of which provide extremely thick overhead fundamental resistance for gold and silver. While overnight PMI readings from Europe were almost entirely improved from the prior month, the currency trade is waiting for US factory orders, ADP employment and ISM services employment index readings to reconfirm the upward track in the dollar.
COPPER
With a fresh lower low for the move and the lowest price since last November, the bear camp has extended its control in copper into another trading session. Obviously, surging interest rates are problematic for most physical commodity markets as traders and economists fear the global economy will stall. Fortunately for the bull camp a very long string of daily LME copper warehouse stock inflows has paused over the last several sessions. Even copper mining shares came under pressure yesterday in a sign of broadening bearishness toward the copper sector.
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