Especially industrial metals could not escape the global recession worries of the last weeks. Thus, silver, platinum, and palladium felt the repercussions. However, the selloffs could be stopped at the marks of the past, giving again opportunities to enter. Platinum stubbornly defends the 900 mark. Silver has now formed a double bottom at $ 22.40 / oz.
Palladium and rhodium are highly cyclical, as their demand is closely linked to the classic automotive industry. Here, too, prices are low compared to the previous year. The basket prices of PGM mines, mainly located in South Africa, have fallen by roughly 40 percent since the beginning of this year. In this context, it is hardly surprising that the focus is now again on costs and that expensive production areas are about to be closed.
Gold also had to give up the 1900 mark in this context but remains within striking distance at times and currently shows an oversold picture with an RSI (Relative Strength Index) of 31. The next interest rate outlook after the summer break will undoubtedly bring new movement here, with the probability of an interest rate pause by the FED becoming higher. It could thus be a fundamentally positive sign for gold. It remains to be noted that we currently have the lowest price since the end of March 2023 and are trading almost 8% below this year’s highs. Speculative investors have certainly seen worse entry points! If the psychological mark of US$ 1900/oz and the 200-day line just above it remains within reach, we see opportunities for a quick comeback. Also, news from the Far East, such as the struggling real estate market, high youth unemployment, and possibilities of deflation in China, do not necessarily speak for calm waters. And uncertainty could be, as it has been since time immemorial, a positive sediment for gold.
“PGM – Spotlight on Precious Metals” is a commodity column focused on gold and precious metals but mainly dedicated to the widely discussed yet rarely analyzed platinum group metals (PGM). Focused on the industrial applications of the metals as well as their potential as tangible assets, the abbreviation PGM has a twofold significance: With Philipp Götzl-Mamba, we could win an experienced precious metal trader operating at the cutting edge of the industry, sharing his knowledge with us.
