Metals: Buyers returned to gold and silver for the first time in four weeks. This after both metals made a strong – and as it turned out temporary - recovery from the correction the previous week. In gold, however, the 3% increase in the net long to 155,274 lots was primarily driven by short-covering. Fresh longs were added to silver with the net long reaching 31,615 lots, some 37,000 lots below the February high. Back then the semi-precious metal traded $18.5/oz compared with the current $26.8/t. It highlights the continued hesitancy from funds to get involved following the July and early August surge.
Copper’s break above resistance at $3/lb (LME above $6600/t), helped trigger a 29% increase in the net-long to a fresh 26-month high at 60,974 lot. An increase that at the end of last week came back to haunt the market and helped trigger long liquidation and lower prices after it failed to establish support above the mentioned levels.
Latest: Gold and silver finished last week close to unchanged as the correction/consolidation continues. Friday’s weakness was led by a stronger dollar in response to stronger-than-expected U.S. economic data. Overall, however the impact was limited due to renewed weakness in US ten-year real yields as the rate dropped back below –1%. Focus in the week ahead will be Trump’s virus treatment news and Powell’s speech at the virtual Jackson Hole symposium. Key support remains ahead of $1900 while resistance has been established at $2015.