Written Commentary
GOLD / SILVER
The gold and silver markets enter the Tuesday trade under pressure because of a slightly positive dollar and residual concerns of how the US Federal Reserve (Powell testifies to Congress on the virus today) could manage inflation and allow significant improvement in the job situation. It was somewhat impressive to see gold and silver hold up in the face of suggestions from the Fed that instead of raising rates the Fed could “alter/increase” the rate of tapering.
PALLADIUM / PLATINUM
While the 3-day high forged overnight certainly puts the bear camp off balance, without a definitive broad-based risk on environment it could be difficult for September palladium to extend the overnight rally above $2600. It should also be noted that platinum ETF holdings last week increased by 18,139 ounces, with holdings on Monday increasing by 4,665 ounces and vaulting the year-to-date gain in holdings up to 8.2%.
COPPER
Bearish sentiment toward copper continues to escalate with stories overnight suggesting that the Chinese copper market is replete with bears. On the other hand, “Wall Street” overnight appears to be touting a “buy dips” posture. While the copper market managed to reject a downside extension yesterday, we leave the edge with the bear camp, as China announced it would investigate the spot iron ore market for its role in driving up iron ore prices and that suggests China is still in the process of trying to deflate a-number-of input prices.
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