We are happy to pick up the headline of last Monday again: ” Will the Precious Metals Make a Swift Comeback?”:
Gold, in particular, made significant gains over the last week. In the previous report, the US$ 1900/oz mark was overcome, and this movement intensified over the week. A high of over US$ 1950/oz was the result, the highest price since mid-July.
This was stopped by the 100-day line, which is currently at 1953.50 US$/oz. Thus, the gold price is currently stabilizing between the two notable average prices (100 & 200-day lines). We expect consolidation this week before there could be further swings.
Silver was on its way up near the US$25 level but was thwarted there after the strong picture of the last few weeks. This seems healthy, as otherwise an overbought sector would have been entered. Thus, chances are good to consolidate at a high level in the US$24/oz area and with support from the 100-day line (US$23.90/oz). This would lift the potentials for higher prices in the fall.
Platinum was impeded at the strong barrier (200-day line). Thus, the jump above the US$ 1000/oz is postponed to the next attempt. That this will happen seems inevitable. Last week, Kitco, for example, reported that the hydrogen market alone could consume up to 2.4 million ounces of platinum by 2030. This calculation comes from Bank of America. In addition, there would be further potential from FCEVs (electric vehicles powered by fuel cells). In perspective, 2.4 million ounces equals about 75 tons of platinum, with a total platinum market size of 180-190 tons per year. Whether this scenario occurs to its fullest remains to be seen, of course, but at least there is enormous potential in this market.
The small PGMs have been quiet recently, with hardly any notable movements. Here, the view of the global economic driver China, which is presently weakening somewhat, also plays a role. In particular, the ailing construction sector is a cause for concern. However, I don’t believe the country is prepared to face an economic or even a banking crisis. And so government investment programs, such as those recently announced, could get the global financial giant moving again. That would also be a starting signal for demand in almost all sectors.
“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.
