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Commerzbank: palladium prices tumble after Monday record high

Kitco News

Palladium is sharply lower, but it’s too soon to declare the recent sharp rally has ended, says Daniel Briesemann, analyst with Commerzbank. Shortly after 9 a.m. EST, spot metal was down $86 to $2,328 an ounce. This comes after a record high Monday that one price vendor put at $2,556.95 an ounce. “We believe it is still too early to declare an end to the price rally, as this would require several days of declining prices,” Briesemann says. “The current development of the palladium price is reminiscent of silver’s performance between 2009 and 2011. Silver also began by rising gradually for a long time before climbing sharply and ultimately reaching a record high of nearly $50 per troy ounce in April 2011. However, the price then slumped and even fell in the following years to below $15.”

By Allen Sykora of Kitco News; asykora@kitco.com

TDS: gold's decline is likely to further liquidation from 'excess allocation'

Tuesday January 21, 2020 09:29

Gold is softer despite weakness in both stock-index futures and the U.S. dollar, and TD Securities suggests traders may simply still be exiting long positions taken out when U.S.-Iran tensions were high earlier this month. Analysts look for prices to eventually move higher again. “Precious-metals prices appear dislocated from the associated risk-off across in global markets — suggesting that positioning dynamics could be taking a larger role than is typically expected,” TDS says. As of 8:44 a.m. EST, Comex February gold was $6 lower to $1,554.30 an ounce. The March dollar index was down 0.184 point to 97.175, and futures for the Dow Jones Industrial Average were also softer ahead of the open on Wall Street. Weakness in both of these markets normally would be expected to underpin gold. TDS writes: “It is more likely that gold-market participants are still looking to rid themselves of some excess allocation to the yellow metal in the aftermath of the U.S.-Iranian de-escalation. Given our expectations that precious metals remain in a bull market as real yields head lower as we head deeper into 2020, combined with strong technicals and momentum, we think that gold prices will resume their upward trajectory in short order.”

RBC's Gero: long-term investors see gold as 'necessary' asset

Tuesday January 21, 2020 09:29

George Gero, managing director with RBC Wealth Management, looks for gold to remain range-bound around $1,540 to $1,580 an ounce. However, he says, long-term investors still see gold as a “necessary” part of a portfolio. “Gold [is] misunderstood by many [who are] not thinking of gold as another currency – liquid, portable, [and] instantly convertible to any currency,” Gero says. He also calls gold a “5,000-year-asset held by many central banks” for reserves. “Traders view gold as another hedge to stocks; short-term investors view up-and-down moves as short-term trading opportunities, but long-term investors view gold as a necessary additional portfolio asset, while haven seekers view gold as home for funds when major economic or political events are headlined,” Gero says.

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.