GOLD / SILVER
While we think gold and silver prices remain vulnerable to further corrective action, seeing open interest come down along with prices and seeing the prospect for an eventual end to the economic headwinds from the pandemic should eventually be supportive for commodities like gold and silver.
Despite a significant overbought condition from 5 days gains of $326, the palladium market has managed to remain near its highs. Fortunately for the bull camp, the last positioning report in palladium showed a net spec and fund long of only 2,860 contracts with an all-time high spec and fund long of 30,000 contracts and that should highlight the amount of potential buying fuel in reserve. Not surprisingly, the platinum market has remained within a sideways consolidation pattern but may be pulled to the top of the resistance in the coming sessions as other metals markets feed a higher off the improvement in overall global sentiment.
While the copper market exhibited significant two-sided volatility yesterday, the improved potential for noted improvement in global economic conditions should serve to strengthen support levels under the market at $3.10 and leave the market more sensitive to fresh bullish developments. However, economic news from China this week has been a little discouraging with deflationary price readings earlier and a decline in New Loans for October overnight.
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