Written Commentary
Metals futures are higher.
PLATINUM / PALLADIUM
The technical action in the palladium market at the end of last week leaves the market vulnerable to a retest of last week’s lows (a quasi-double low) at $2,105. With slightly discouraging Chinese data at the end of last week and ongoing inconsequential inflows into palladium ETF holdings, we can’t rule out a further retrenchment down to $2,079 in the event that a modest amount of risk off sentiment is thrown off from global equity markets to start the trading week. While the platinum charts are also bearish like the palladium charts and the October contract lacks solid support until the $930.10 level it should be noted that platinum ETF holdings last week increased by 75,640 ounces and are now 5.7% higher year to date.
GOLD / SILVER
While gold is tracking higher to start this morning it remains within the trading range put in place at the end of last week. However, the US dollar this morning has forged a 6-day low and could begin to provide fresh speculative currency related buying. While the silver market also suffered a slide last week from $29.00 down to $24.48 Friday, the market rallied back to $27.88 in a fashion that certainly gave warning to the bear camp that pressing the market could prove to be painful.
COPPER
While the copper market is showing some initial strength this morning, to make a splash in the market and threaten the bear camp probably requires a trade above a month-long downtrend channel resistance line at $2.9005. However, the copper market should be emboldened by notable strength in nickel and zinc prices in China which indicates the base metals saw the PBOC assistance as facilitating the already in-place Chinese economic recovery.
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