Gold & Silver Market 7-27-2015

Overall last week was fairly positive for precious metals, but everything was overshadowed by the beating gold took from the markets. A coincidence of factors led to a sharp fall in the headline price, and took most of the investing media’s attention, which is understandable. However silver suffered much less and across the platinum group we saw prices start to recover. The sector is still confused and it’s not easy to make predictions, but unless you had money tied up in gold it was actually a reasonably good week.
Let’s get the bad news out of the way first. Gold was a major loser last week, sliding most of the period but with the real damage done on Monday. In one day it shed over 4 percent of its value and hit a low it hasn’t approached since early 2010. There’s now a wide acceptance that sub-$1,000 gold is likely in the near future; right now it’s standing at $1,099.50, a loss of $33.30 over its previous close. Predictions of a fall to $700 still seem alarmist, but further losses are likely unless something else changes radically.
Silver managed to do slightly better; it still lost value, falling ten cents to close at $14.74, but that’s less than one percent and a lot smaller than most recent weekly falls. It’s likely that the spot price was propped up by the decline in equities, which saw both the Dow and FTSE 100 slide all week with no sign of turning round – or even hesitating. However that trend might not last, as the US economy is still doing pretty well.
The platinum group has been looking very mixed recently but last week it was the strongest sector of the precious metal market. Platinum itself managed to get to $987, a gain of $21.50. That’s less than a third of what it lost the week before but still a significant move in the right direction.
Palladium followed a similar track to platinum; after a serious fall the previous week it climbed sharply on Monday, settled back slightly on Thursday then gained a few more dollars in the last hours of Friday trading. It closed at $624, a $21 rise.
The story with rhodium isn’t so positive unfortunately, with a $60 slump wiping out most of the previous week’s gains. Even this isn’t as bad as it looks though. Most analysts were startled when rhodium gained $80 in an unexpected surge, and if something looks too good to be true it probably is; that gain was too fast and a correction was likely, but what’s interesting is that it didn’t fall all the way back. If it stays at or above its current level for another week or two that could be a first hint that rhodium’s long slide is nearing an end.
So a mixed week overall, but while gold was extremely disappointing the recovery in the platinum group holds out some promise. Right now we’d be cautious about buying in a big way – and even more so about selling – but it will be interesting to see if a trend starts to develop.

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