Written Commentary
GOLD / SILVER
While it is premature and a leap of faith, it is possible that an inflow into gold ETF holdings yesterday (48,240 ounces) signals an improvement in sentiment toward gold. The increase in gold ETF holdings was the largest inflow in over a month, and we suspect a 4-week rally has finally stirred speculative long interest. In the silver market, prices clearly lagged the gold market on strength yesterday, but with the market leaving a double low in the vicinity of $25.67 yesterday that level could be a key pivot point today.
PLATINUM / PALLADIUM
In retrospect, we are not surprised to see palladium reverse course and dive sharply following news yesterday that the world’s largest palladium producer (Russia’s Nornickel) pegged its full year 2021 output to jump by 40%! With the platinum market forging a minimal rally over the prior 3 trading sessions, its corrective action ahead could be more modest than the corrective action in Palladium.
COPPER
With copper forging a 5th straight day of new highs for the move yesterday, news that one of the world’s largest copper producers (Antofagasta) saw its first quarter output fall 5.7% due to infections, the bull camp continues to get the support it needs. A developing trend of declining LME copper warehouse stocks has surfaced again and therefore copper should have supply-side fundamental underpin following 6 days of gains.
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