Dillon Gage is proud to offer the following insights into the precious metals market from Roy Friedman. Roy has over 3o years of in-depth experience in all facets of precious metals. We will offer Roy’s comments several times each week.
Precious metals have traded quietly but firm since Friday’s close, as all four metals were higher yesterday in Europe and remain higher this morning. With no major negative news coming out of Europe over the weekend, platinum and palladium have taken a leadership role as the PGM markets are reacting to a Reuters’ article which stated that the Chinese government will attempt to stimulate their economy by paying subsidies to individuals who trade in an old vehicle for a new energy efficient model. In addition to creating additional demand for physical metal, speculators and investors alike have been reacting to headlines regarding a fall in output of PGM mine supply throughout the second half of this year.
Overnight ratings agency S & P lowered the rating on 5 Spanish banks as they warned the country could be heading towards a second recession. As bond yields move higher this morning in Spain, Greece, Ireland and Portugal, there will be more talk this week of bailouts in the Euro zone which will add short term pressure to our markets. As we begin the trading week I am looking for resistance to be stiff from $1,585.00 through $1,600.00 in gold. A break of $1,600.00 frees us up to test $1,645.00 – $1,650.00. On the downside, support should be significant from $1,550.00 down to $1,525.00. A break of $1,525.00 would have me looking for a test of $1,450.00.
Roy Friedman has a degree in economics and political science from the State University of New York at Binghamton. For more than 30 years, he has worked at all levels of he industry including as a trader for major Metals firms and international banks. For more information on Mr. Friedman, please click here.