Written Commentary
PRECIOUS METALS
Gold:
About the most positive thing that can be said about gold is that it has managed to remain within the sideways consolidation that began back on June 23rd. In fact, the gold market posted a positive technical rejection of 10 month lows with Friday’s low at $3,963 holding above the consolidation pattern low of $3955.40. However, the silver market technical structure has not improved with the September contract on Friday posting a fresh eight month low and the markets seemingly entrenched in a downtrend channel. Unfortunately for the bull camp, the fundamental side of the equation in precious metals lacks a solid argument for the markets to bottom.
Silver:
The silver market has managed to trade above the downtrend channel resistance line drawn from the July highs, it has minimally more positive investment flows than gold and there is chatter of improving industrial demand for solar energy cells and electronics associated with AI/big data.
BASE METALS
Copper:
While the copper market was obviously undermined from last week’s macroeconomic deterioration associated with a full-blown return to war with Iran, the market appears to be showing bullish resiliency this morning with open interest showing a pattern of rebuilding and heavy trading volume on Friday’s solid rejection of a six day low. In fact, Shanghai spot copper premiums posted a “new high for the year”, in a sign that Chinese physical inventories remain very tight.
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