Written Commentary
GOLD / SILVER
A lack of progress towards peace in Ukraine leave the possibility of further escalation, which could spark a resumption of flight to quality buying in the metals. Fed tightening should be negative for the metals, but the ongoing war counters that. Despite talk of negations, many are arguing that the Russia/Ukraine war could be head towards a stalemate. If the EU comes through with restrictions on Russian crude oil imports, we could expect another move higher in crude oil and possibly more buying in gold and silver.
PALLADIUM / PLATINUM
News that Shenzhen, China will lift several COVID restrictions offers support to the PGMs, as a recovery of computer chip production brings a sigh of relief to automobile manufacturers and supports auto catalyst demand. The Ukraine war had spiked palladium prices because Russia is a big exporter of that metal, but then the Covid shutdowns in Shanghai and Shenzhen threatened demand, so the Shenzhen news should support palladium if other cities can avoid shutdowns. April platinum has followed a similar trajectory to palladium, as it too is sitting at roughly the half-way point of the December-March rally.
COPPER
While copper’s 3-day winning streak resulted in a positive weekly reversal with prices more than 25 cents above last Tuesday’s 2 1/2 week low, they are finding significant pressure coming into this morning’s action. Demand concerns from China are shadowing the market, and copper may have trouble regaining upside momentum early this week. Shanghai exchange copper stocks had their largest weekly decline since May 2020 last week, which was supportive to copper on Friday.
Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. The information and comments contained herein is provided by ADMIS and in no way should be construed to be information provided by ADM. The author of this report did not have a financial interest in any of the contracts discussed in this report at the time the report was prepared. The information provided is designed to assist in your analysis and evaluation of the futures and options markets. However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to ADMIS. Copyright ADM Investor Services, Inc.
