Gold and silver futures see substantial safe-haven demand
Bullion.Directory precious metals analysis 17 July, 2014
By Christopher Lemieux
Senior FX and Commodities Analyst at FX Analytics
Headline risk continues to keep precious metals supported, while a Boeing 777 flight from Amsterdam to Kuala Lumpur carrying 295 passengers was shot down over Ukraine by rebels. The Ukrainian Interior Ministry confirmed that the plane was struck down by a missile in Eastern Ukraine.
Gold and silver futures saw substantial safe-haven demand, after deep technical selling earlier in the week and underlying geopolitical concerns.
Chris Gaffney, senior market strategist at EverBank Wealth Management, said the plane crash in Ukraine “heightened concerns over the tensions in Russia and Ukraine, and definitely triggered safe-haven buying.”
Gold, up over 1.6 percent, has broken through the daily 200 EMA and currently above price action resistance of $1,317.90 per ounce.
Silver, up over two percent on the session, has regained $21 per ounce.
The daily 200 EMA has held as a near-term dynamic support level as of late June. Price action will likely test $21.33 before seeing a test of $21.50 per ounce.
Palladium continues rallying through a 13-year high on new economic sanctions on Russian corporations.
There is speculation that economic sanctions could reduce the production out of the world’s largest producer. However, palladium has underlying industrial demand that is positive for palladium.
“There’s a confluence of positive factors for palladium, with good car sales and supply constraints in South Africa,” according to Robin Bhar, analyst and head of metals research at Societe Generale.
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