Written Commentary
GOLD / SILVER
About the strongest endorsement we can give the bull camp at this time is the fact that both gold and silver have built consolidation support above last week’s sharp washout lows. However, the dollar is bordering on a 4-day low, with a trade below 91.64 capable of providing a modest wave of currency related buying. It should also be noted that the gold and silver markets came away from the US Federal Reserve chairman testimony yesterday with a slightly more upbeat tone than was seen following the FOMC meeting press conference last week.
PLATINUM
The rally in the palladium market yesterday was disappointing to the bull camp as prices failed to hold an upside breakout above $2,600 with that level seemingly becoming resistance from a series of highs around $2,595. Disappointing the bull camp is the fact that platinum prices outperformed palladium on the upside, despite-the-fact that palladium holdings over the past 6 sessions have increased by nearly 20,000 ounces which is almost a 20% gain.
COPPER
Seeing September copper forge a 4-day high and regain the $4.25 level overnight in the face of news that the Chinese government is physically planning to release copper supply from strategic storage suggests the market has likely factored in the negative supply influences from the world’s largest consumer. While China’s state reserves Bureau will release 20,000 tons of copper, 30,000 tons of zinc and 50,000 tons of aluminum next month, the Chinese Bureau has acknowledged the amount of supply scheduled for release is relatively small, and the trade has suggested the releases will be smaller than were feared.
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