CHARTS: The coming critical minerals trade war is BRICS short of a load
"While a large number of countries around the world continue to talk about securing raw material supply, China is actually doing something about it."
Gold failed to capitalize on the stock market rout and December futures tumbled 4% or $74/oz to $1,734/oz by early Thursday afternoon as the Fed warned of “significant downside risks” and pessimistic economic data from China further damaged sentiment.
Silver was hardest hit and platinum and palladium prices came under pressure as well. December silver slid -9.8% or almost $4 to $36.50 an ounce while October platinum lost -4.9% or $87 to hover just above the $1,700/oz level. Palladium for December delivery traded down -8.1% to $655.05 an ounce.
The iShares Silver Trust ETF fell 8.2% and the SPDR Gold Trust ETF GLD fell 2.6%, while November gold futures slipped a more sharp 3.9%.
MarketWatch quotes Matt Zeman, head trader and strategist at Kingsview Financial in Chicago: “You’ve got liquidation, people are going into cash and Treasurys. Fear is dictating the gold market.”
Reuters quotes Peter Hillyard, ANZ head of metal sales in Europe: “The textbook ideas, the things we follow, the things we believe to be so are being shot to pieces for the moment and it’s very difficult to trade other than for a long-term view.”
Bloomberg quotes Lv Xiaowei, an analyst at First Futures Co: “If the global economy continues to deteriorate, there will come a point where we’ll see both gold and the dollar going higher together as people look for least risky assets.”
Base metals were not spared and the December copper contract fell 30 cents, or 8%, at $3.46 a pound – down from $4.15 a pound just two weeks ago.
4 Comments
Dan Oancea
Slaughter of the lambs … the wolves are buying. Same happened in 2008.
“If history repeats itself, and the unexpected always happens, how incapable must Man be of learning from experience.” – G.Bernard Shaw
Tapestery
The early wolves get eaten when the real downturn arrives. Bide your time and get the bargains later with gold at $500 and silver at $10.
Nicholas Powrie
Sorry, but I can’t see gold dropping to $500, more like S850-900 as an absolute worst case position
Silver will fall further……
hardrock blaster
look at the 10 yr chart: you can just see this dimple. This means nothing in long term thinking.