GOLD / SILVER
With another new high for the move and headlines buzzing about historic investment flows into gold ETF’s traders should expect gold to continue to rise off follow-through buying. Clearly, the most significant single bullish force operating in the gold market today is the exploding interest in gold ETF’s. While it might be suspect to expect the historical pattern of investment inflow in the first 6 months of 2020, to be fully replicated in the 2nd half of the year, the inflows have already surpassed the previous record full year investment tally posted back in 2009.
PLATINUM / PALLADIUM
Clearly there was divergence within the PGM markets on Tuesday with platinum gaining nearly $30 an ounce on palladium. In our opinion, the reawakening of investment interest in the gold market is in turn waking up interest in platinum which has not had the historic explosion in prices seen in palladium. In fact, with platinum prices sitting nearly $1100 an ounce below palladium, those looking for a gold-like investment could begin to look more favorably upon platinum in the coming months.
The latest wrinkle in favor of the bull camp from the supply front is news of a shutdown of a copper mine in the Congo due to an outbreak of the virus. Furthermore with LME copper warehouse stocks continuing to post significant daily draws, the bull camp has to be heartened from both supply and demand conditions. While not an overly significant driving force, US scheduled data has remained positive and that demand hope has been consistently joined by hope for improving Chinese copper demand.
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