Precious Metals News Update - 8 February 2018

Hello everyone.
 
Precious metals remained under the cosh on Wednesday as the Dow Jones Industrial Average recouped 1,500 of the (approximately) 2,200 points it had shed since last Friday and as the US Dollar continued to find its feet against the “majors” (Euro, JPY and AUD).
 
Technically, XAU/AUD retraced half of its previous day’s AUD 40.00 range as it bounced off the 21 Day moving average at AUD 1675.00 but Tuesday’s “One Day Reversal / Blow off Top” candlestick on the daily chart (an advance to a fresh high followed by a reversal and close below the previous day’s low) is still a major concern and downside follow through into the AUD 1650/1670 zone (the 55 & 200 day moving averages respectively) remains favoured.
 
As noted yesterday, XAU/USD’s close below the 21 Day moving average looked like the market had “rolled over” and as things transpired, the rally back towards USD 1335.00 was capped with the 38.2% Fibonacci retracement (of the mid-December to late January move from USD 1236.50 to USD 1366) at USD 1316.65 being tested and with the way still open towards the USD 1301.30 (50%) and USD 1286.00 (61.8%) retracements. The recent sequence of lower daily highs and lower daily lows suggests that for the present time a “sell rallies” stance is the way forward, with the market likely to find itself capped near USD 1330.00 now.
 
Elsewhere, XPD/USD since peaking at USD 1,140/oz on January 15th, broke beneath USD 1,000 on Wednesday as ETF outflows snowballed. Commerzbank in its daily precious metals commentary noting that “outflows from palladium ETFs have totalled more than 100,000 ounces or 8% since the start of the year”. This has resulted in the Platinum / Palladium spread “normalising” – XPD currently at a mere USD 8.00 premium over platinum, which is down from around a USD 150.00 premium in favour of palladium at its peak.
 
Good luck.
 
Regards,
Andre