Treasury Yields Ding Gold

Treasury Yields Ding Gold

Higher Treasury yields and a selloff in the Bond Market are attributing to lower Gold prices this morning.

Strong selling continues to emerge every time we approach the $1,300 level as the holders of short positions have no problem adding on to their holdings.

Most of the global equity markets are higher this morning. The Dow is much lower this morning due to the significant sell off in Boeing stock after the tragic airplane crash of one of their most recent models. Otherwise the Dow would be in positive territory.

For the most part, investors are still most interested in the Equity Markets and not finding a need for any safe haven products at this time.

The Palladium EFP is tightening up a bit, now minus 50 minus 40 supporting higher prices. One-month Palladium lease rates are stabilizing at 10.5 percent. For the most part, holders of long positions seem to be content just staying put awaiting the next bit of news.

The difference between the price of Palladium and Platinum has widened to over $700 per ounce, reflecting the diverging fundamentals between the two metals. If we once again approach the $800 level, some Wall Street traders have indicated that they expect a selloff to accelerate as buyers will see little reason to get involved at those levels.

Between registered and eligible status, CME Silver Warehouse stocks have now surpassed the 300-million-ounce level, further indicating there is no need to rush to buy and hold 1000-ounce silver bars at this time. So for the time being, I expect the price of silver to continue to trade sometimes as an industrial metal and sometimes as a precious metal. In other words, I don’t see much potential for any significant rally in the price near term.

Have a wonderful Monday.

Disclaimer: This editorial has been prepared by Walter Pehowich of Dillon Gage Metals for information and thought-provoking purposes only and does not purport to predict or forecast actual results. This editorial opinion is not to be construed as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein cannot be attributable to Dillon Gage. Reasonable people may disagree about the events discussed or opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. It is not a solicitation or advice to make any exchange in commodities, securities or other financial instruments. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisers with respect to these areas. By posting this editorial, you acknowledge, understand and accept this disclaimer.