Written Commentary
GOLD / SILVER
With a risk off physical commodity market washout early in place early today the gold and silver bulls are fighting against a bearish outside market tide. Clearly, the lockdown of Austria and the prospect of isolated lockdowns in Germany has fostered a deflationary commodity environment with gold and silver in turn freshly damaging their charts this morning. Surprisingly, gold has not benefited from news that China may offer stimulus for their economy especially with that news lifting iron ore prices and copper premiums significantly overnight.
PALALDIUM / PLATINUM
With palladium forging a definitive lower low for the move early today the bias in the PGM markets remains down. We expect the palladium market to fall along with other physical commodities today with support on the charts all the way down at $1,900 and then again down at $1,865.50. Similarly, the platinum market violated several key support points overnight and appears headed down to the early October spike low of $939.20.
COPPER
With a 5-day high early today the copper market is likely responding to overnight chatter about the People’s Bank of China providing some stimulus to the Chinese economy. With another large decline in daily LME copper warehouse stocks of 4,925 tons overnight the bull camp is also benefiting from the ongoing tightening supply situation. We would also note that iron ore prices have surged off the hope for Chinese government stimulus with some traders suggesting the Chinese have temporarily derailed inflation and now must shift back to supporting their economy.
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