Quite a few things have happened since our last market update, mainly the escalation between Israel and Iran. On the news that Israel had launched strikes against Iran gold demonstrated its safe haven demand and the market easily rose over $3400, hitting as high as $3451 over the next couple of hours after the strike. Silver was close to follow with it going from sub $36 to $36.63 in what felt like a blink of an eye. The news prompted both retail investors, traders and other market participants to jump in feet first. Its times like this where precious metals really shine and its evident that the strike echoed the potential of an all out war happening.
The run fizzled out as Israel asked the US to join the fight and strike Iran, but they refused. As this news came out the fears of an all out war subsided and the demand for the yellow metal fell. Gold is currently trading under $3400 which in all honesty is a bit disappointing as in my opinion there is more than enough going on in the world for the $3400 to be supported. On the other hand you have silver, which has had a deficit year after year, a ration that’s been out of sorts, which is now shining even brighter than gold. Silver is currently trading at 13 year highs, over $37 an oz. There has been a huge wave of buyers engaging in silver markets, which has allowed it to trade where it is now.
I don’t usually touch on platinum group metals, but the current situation in Platinum is something worth noting. It had been some time since we asked Mints for Platinum and were told they were out. In turn physical Platinum premiums are increasing as there is no availability on the shelves at Mints, but only on the secondary market (if any.)
I would play this market close to the vest, especially on silver, the rise today of over 2% for me is too much too fast and the potential for a correction is there.
Josh Perez
Managing Director
Chief of Global Trading