Written Commentary
GOLD / SILVER
Not surprisingly, the gold market is tracking lower today following a deflation of fear from the Evergrande default threat after the company settled its interest payments on a domestic bond. Therefore, seeing gold fall back this morning is justified but the market is likely seeing some cushion from news that the PBOC injected liquidity into the markets to the tune of 160 billion yuan.
PLATINUM
With an analyst indicating he sees no end in sight to the global semiconductor shortage, a record net “Spec” and fund short in palladium and negative charts, the path of least resistance in palladium remains down. In fact, projections are that the US manufacturers will produce 1.2 million vehicles less than expected this year because of the chip shortage. Certainly, the palladium market is oversold with the net spec and fund short holding near record levels and the market forging a 3-day high to low washout of $252.
COPPER
With the Evergrande crisis temporarily placated, Chinese markets reopening from holiday, iron ore prices jumping in China, ongoing declines in daily LME copper warehouse stocks and positive early global equity market action, the path of least resistance in copper is up to start.
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