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Gold and Silver Market Update (10/20/14) – Golden Eagle

October 20, 2014 0 Comments

We were hoping to see a continued improvement in the precious metals market last week but, apart from gold, that didn’t really happen. It was far from being a disaster but with the exceptions of gold and rhodium all the key metals either stuck close to the week before or lost value, despite mediocre performance in the other sectors that should have encouraged the smart money to buy in.

Gold was the week’s success story, picking up $15.90 to close at $1,238.90. That’s a 1.2 percent increase over the period, an unspectacular but still respectable gain. With any luck gold has established a floor at just above $1,200 and should start to build on that. The conditions are certainly right for it to pick up a lot of the value it’s lost since July. That makes it a very attractive purchase right now, because at this price it’s a real bargain.

Silver didn’t do so well, dropping 12 cents to end the period at $17.27. However compared to some of the weekly losses we’ve seen recently that’s nothing, so while it wasn’t the week it could have been it still didn’t signal a looming price collapse. It’s most likely investor confidence in silver is still weak after its long run downwards but fundamentally it remains a sound investment; industrial demand is good, and unless the stock market takes off again silver should start riding in gold’s slipstream.

Platinum was one of the weaker performers the previous week and that lackluster trend continued. In fact up to Thursday it looked as if it would finish slightly down, but a small late rally took it to $1,253. That’s a gain of just $2, definitely nothing to write home about, but small as the movement was at least it was in the right direction. Platinum is still close to a five-year low, so there’s no reason why it shouldn’t pick up a lot more in the near future.

Palladium was definitely the weakest of the metals last week. From a starting price of $779 it climbed slightly on Monday, then abruptly plummeted all the way to $725 by midday Thursday. Most of the other metals fell away slightly towards the end of the week as the Dow gained back the ground it lost on Wednesday but palladium, for some reason, tracked equities and rose along with it, finishing at $751. It’s possible that the rising stock market got investors thinking about industrial demand for palladium.

Finally rhodium didn’t really go anywhere. It started the week at $1,178, dropped slightly on Wednesday and Thursday then, like palladium, followed the Dow back up on Friday. When trading finished it was right back where it started.

The uncertainty in share prices should have resulted in a much better week for metals than we actually saw, especially combined with the continued fall in oil prices, so it’s hard to pin down exactly why they performed so sluggishly. The most likely answer is that a lot of investors were too spooked to buy anything at all. Overall though it could have been a lot worse, and was definitely a big improvement on some weeks we’ve seen recently. Metals are still available at bargain prices and there’s a real prospect of gains in the near future.

 

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Filed in: Market Updates

About the Author:

Clint is the director of marketing at Golden Eagle Coins. Son of Richard Stelfox, co-founder of the company, Clint has been living and breathing coins his entire life. After trading for a Philadelphia Stock Exchange firm for several years Clint returned to give Golden Eagle the online presence it has today.

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