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Uncertainty: still good for gold

Commentaries & Views

A close for gold above $1925, on a weekly basis, looks to be in the cards thus far. Silver, however, which looked to be ready to begin its ascent in the sector, has been relegated back down to smaller sibling status for now. A close over $24.90 - $25 would still be positive, but silver bulls are eyeing resistance at $25.60. Platinum looks to be ready to challenge the $1100 level, now consolidating back over $1065. Palladium continued its ascent overnight, and is trading within $40 of its all-time high as of this writing.

Gold may be trading at a fear premium this morning, as news broke of an attack on the Ukrainian power infrastructure after hours yesterday. Stock futures reacted to the news with a knee-jerk plunge, which is now halfway recovered. Index futures are, however, pointing to a lower open today. The USD index also shows strength, trading up almost a full percentage point. This is another indicator that fear is still embedded in market participants' psyche, especially as the rise in the world reserve currency has had no impact on commodity prices.

With US jobs numbers on deck this morning, there is no lack of catalysts for further knee-jerk volatility. News regarding the conflict in Ukraine can break, and change direction from escalation to de-escalation at a moment's notice over the weekend; trader positioning will likely reflect those jitters before the close today.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.