Written Commentary
GOLD / SILVER
A headline from Reuters overnight highlights the dichotomy in the gold market as it suggested gold is headed for its 4th weekly loss off “inflation jitters”. In other words, the fear of inflation is “pressuring” gold. Expectations for the November US CPI call for a gain of 0.7% and that apparently has the gold market fearful of action from the Fed.
PALLADIUM / PLATINUM
While the palladium market managed to reject more than half of yesterday’s initial aggressive downside washout, the charts this morning have shifted back in favor of the bear camp. In fact, news of an increase in South African PGM production puts the supply-side of the equation in the Bear’s favor.
COPPER
In our opinion the primary force holding up copper prices over the last 35 days has been the persistent evidence of tightening global exchange warehouse stocks. Therefore, seeing both LME and Shanghai copper stocks increase by 3,850 tons and 5,270 tons respectively deals a significant blow to the bull case. It also seems as if the press continues to trumpet the difficulties in the Chinese property sector thereby curbing expectations for Chinese construction and in turn reducing some copper demand expectations.
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