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Gold and Silver Market Update (8/18/14) – Golden Eagle

August 18, 2014 0 Comments

It’s been another mixed week for metal investors, with no clear direction in the market overall. The uncertain international situation is definitely at least partly to blame, but can’t explain everything we’ve been seeing recently. Generally precious metals as a group have a clear direction even if there’s some individuality within it but this week that’s just not been the case.

Gold didn’t really go anywhere this week. After some fluctuations it closed the period $4.50 down on the week before, a change of around 0.3 percent. Friday’s claims that a Russian convoy in Ukraine had been shelled spurred gold into a last-minute climb as equities dipped, and bad news from Eastern Europe could see that translated into a further climb next week.

Silver, which started diverging from gold last week, made a clear loss during this period. Finishing 35 cents down at $19.55 – a drop of 17 percent – that’s the fourth week in a row the price has been trending down. It’s not easy to see why it’s been falling so consistently given the financial situation in general, but the trend is clear.
Platinum is another loser this week. Closing at $1,452 it’s given up almost all of last week’s gains, finishing almost $13 down on Monday’s price.  Most of the fall happened on Thursday and Friday, and unlike gold there wasn’t much of a turnaround towards the end of the period. We don’t think platinum is overvalued at the current price so there’s no reason for this fall to continue unless the stock market recovers strongly.

Moving on to palladium things look a lot better. This price has been climbing steadily since last Tuesday and it continued to do that all through this week. When the markets closed on Friday they left palladium at a new five-year high of $890, up $32 over last week’s close. Continued strong demand in the auto industry is driving the price and with no news of new deposits to ease concerns about scarcity we expect to see it safely past $900 by this time next week. If you’re in a position to buy palladium this would be a good time to do it, because we can’t see any reason for it to fall back any time soon.

Finally rhodium also had a good week, rising steadily to close at a twelve-month high of $1,380. That’s nowhere near the $2,930 it was briefly trading for in early 2010 but it does look as if its long, slow fall has solidly reversed itself. Next week may be slower, as the price stabilized slightly on Thursday and Friday, but we don’t see the price going anywhere but up in the short to medium term. Rhodium is another one to buy at the moment.

If it wasn’t for the stagnant gold price we’d rate this as a good week overall for metals. Because of gold’s dominant place in the sector we can’t really call it a success, but despite the drops in platinum and silver it wasn’t exactly a bad period either. We’re looking for gold to pick up again next week and for palladium to continue its climb; that will put a much brighter complexion on the market.

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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