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Precious Metals Review

Market information and news is critical for precious metal investing. However, many investors have limited time to sort through the massive amounts of market data and gold, silver and platinum news. The Monex Precious Metals Review consolidates the week's activities in a concise snapshot of the precious metal markets.

PRECIOUS METALS REVIEW - September 21, 2018
In the precious metals markets this week...
GOLD

The Monex AM closing price on Friday was $1,197, up $2 for the week. Monex spot gold prices opened the week at $1,195 . . . traded as high as $1,208 on Thursday and as low as $1,131 on Friday. Gold support is now anticipated at $1,185 then $1,160, and then $1,133. . . with resistance anticipated at $1,207, then $1,218, and then $1,232.

SILVER

The Monex AM closing price on Friday was $14.28, up $0.23 for the week. Monex spot silver prices opened the week at $14.05. . . traded as high as $14.36 on Friday and as low as $14.05 on Monday. Silver support is now anticipated at $14.10, then $13.85, and then $13.60. . . and resistance anticipated at $14.34, then $14.65, and then $15.06.

PLATINUM

The Monex AM closing price on Friday was $830, up $32 for the week. Monex spot platinum prices opened the week at $798 . . . traded as high as $836 on Thursday and Friday and as low as $798 on Monday. Platinum support is now anticipated at $820, then $794, and then $768 . . . and resistance anticipated at $860, then $895, and then $927.

PALLADIUM

The Monex AM closing price on Friday was $1,051 up $71 for the week. Monex spot palladium prices opened the week at $980. . . traded as high as $1,054 on Thursday and Friday and as low as $980 on Monday. Palladium support is now anticipated at $1,038, then $1,017, and then $978. . . and resistance anticipated at $1,060, then $1,088, and then $1,120.

Monex VP Mike Maroney and CPM Group Managing Partner Jeffrey Christian offer analysis and commentary on recent activity in the economy, geopolitics and the precious metals markets in our "Prepare & Diversify with Gold & Silver" video series. Watch now to learn what gold and silver could do for you https://www.monex.com/prepare-and-diversify/
QUOTES OF THE WEEK...
From Reuters in 9/20 www.investing.com Gold Prices Tick Higher as Dollar Slides

"Gold prices ticked higher on Thursday, as the dollar slumped, boosting the appeal of the yellow metal.

Comex gold futures were up $2.50, or 0.2%, at $1,210.70 a troy ounce by 9:25AM ET.

Meanwhile, spot gold was trading at $1,205.97 per ounce, up $1.80, or 0.2%, after rising 0.5% in the previous session.

The dollar sank to a more than three-month low against its major rivals in part as safe-haven demand for the U.S. currency ebbed amid continued relief that fresh U.S. and Chinese tariffs on reciprocal imports were less harsh than originally feared.

On Monday, the U.S. slapped tariffs of 10% on $200 billion in Chinese goods, before they rise to 25% by the end of 2018, rather than an outright 25%.

China retaliated by putting tariffs on $60 billion in U.S. goods. However, China will put a 10% tariff on some goods it had previously earmarked for a 20% levy.

The U.S. dollar index, which measures the greenback's strength against a basket of six major currencies, was down 0.65% at 93.50, after sliding to 93.41 earlier, the weakest since June 14.

Dollar weakness usually benefits gold, as it boosts the metal's appeal as an alternative asset and makes dollar-priced commodities cheaper for holders of other currencies.

In other metals action, silver futures were largely unchanged at $14.28 a troy ounce, after earlier touching two-week highs at $14.38.

Platinum was up 0.6% at $826.90, after hitting its highest since August 10 at $831.00 earlier.

Meanwhile, palladium gained 1% to $1,041.00, having hit a fresh five month high of $1,042.50."

From Myra P. Saefong in 9/17 Barron's Investors See a Bargain in Silver, but Is It Real?

"A drop in silver prices this year has attracted investors seeking a bargain, prompting a temporary sellout of the 2018 American Silver Eagle bullion coins at the U.S. Mint this month.

'The sellout of Silver Eagles implies that demand for physical [silver] has recently been increasing,' says Chris Gaffney, president of World Markets of TIAA Bank. 'With Silver Eagles being the most popular bullion coin available, this is a good indicator of physical demand,' he adds, and higher demand 'makes sense,' given that prices are nearing multiyear lows again.

Edmund Moy, director of the U.S. Mint from 2006 to 20111, says the recent sellout of the 2018 coins from strong growth in demand was unusual. He adds that sellouts happened much more frequently during the financial crisis of 2007-2009 and the Great Recession, which began in late 2009. Back then, the mint had a hard time meeting surging demand, as some worried investors sought refuge in precious metals.

Moy notes that sales peaked at 47 million ounces in 2015, but that this year's are still running above the 10 million-ounce annual totals seen before the financial crisis and Great Recession. He expects sales to end the year at 11 million or 12 million ounces.

The U.S. Mint says that increased demand was behind the Silver Eagle sellout. Moy says the 'surge was likely caused by silver speculators spurred by the gold/silver ratio,' which currently stands at around 1 to 85, based on Tuesday's settlements. That means it took about 85 ounces of silver at $14.15 to buy one ounce of gold at just over $1,202. The historical norm is 1 to 50, 'which means gold is overpriced or silver is underpriced,' Moy observes. 'Speculators are betting that silver is underpriced.'

Analysts attribute the weakness in silver prices to several factors. 'A continued strong dollar trend, record-high equity markets, and a rising-rate environment here in the U.S. have combined to keep precious-metals prices in check this year,' says Gaffney. 'Aggressive short selling in paper markets [such as futures], due to a higher dollar, added to the drop in prices.'

Global trade tensions probably will have a big influence on silver, as the 'general viewpoint is that the proposal of increased tariffs against Chinese imports will be worse for China than the U.S.,' he says. This should aid 'the dollar and will put additional pressure on the metal.'

In any case, at about $14 an ounce, silver was bound to attract more buyers. It's 'now very undervalued, relative to stocks, bonds, and, indeed, gold,' maintains Mark O'Byrne, research director at precious metals brokerage GoldCore in Dublin, which has seen the amount of the metal clients have stored grow 24% this year. 'We believe that we are on the verge of another financial crisis, likely due to contagion among European banks, which will impact rise assets,' he warns, adding that this should lead to 'significant hedging and investment demand for both gold and silver.'"



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This is not a recommendation to buy or sell.

Last update: Sep 21, 2018 10:57:27 AM

This is not a recommendation to buy or sell.