GOLD / SILVER
We view gold and silver to be very vulnerable to further selling this week off infection inspired slowing fears, a rising dollar and from technical related pressure.. At this point, it would not seem like a stimulus deal will be reached ahead of the election and that adds another weight on the back of sentiment. In fact, even a small deal might be-seen-as disappointing to the marketplace now and the failure to save psychology in the face of expanding momentum of inflections should put gold, silver, and most commodities under severe pressure.
All things considered the palladium market held up impressively last week in the face bearish fundamental news flow. After seeing some positive economic readings from China early last week and some periodic positive data from the US, palladium did manage to claw out impressive gains before disappointment from the stimulus failure knocked prices back off the highs of the week. However, the charts have turned bearish this morning and it would appear as if outside market forces will add to the bear case early this week. With a huge range up extension at the end of last week, it would appear as if the platinum market has set itself apart from the rest of the precious metal markets.
A reversal from last week’s highs in copper was partially the result of the failure to get a US stimulus package, but also because of the ever rising infection counts (inside and outside of the US) and finally because of strength in the Dollar. Going forward talk of returning to lockdown rekindles non-Chinese copper demand fears and it would already appear as if a liquidation wave is in motion this morning.
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