Asian Metals Market Update for 19th July 2024

July 19, 2024

I am not calling this week’s fall in gold and silver a bearish trend. This is just a correction and nothing else. Sector-wise position squaring and rebuilding is there. Why? The higher chance of Donald Trump being the president of the USA is the reason. Till last week most of the traders and large hedge funds were invested based on a Biden win. Volatility can also rise as a result of this.

China’s retail growth is way below expectations. This is the reason for the sell-off in copper and base metals this week. Next week also, key US economic data releases will start from 25th July/Thursday.

Assets managed by BlackRock hit a record $10.65 trillion in the second quarter thanks to rising client asset values and as investors pumped money into the company's exchange-traded funds. Black Rock is the world's largest fund manager. BlackRock's chairman and CEO Larry Fink said that he saw great potential for investments into the energy transition and artificial intelligence data centers. My View on this: Energy transition needs copper, aluminum and other industrial metals. Copper and all base metals are in a long-term bullish zone with bouts of short-term bearish phases. (news source Reuters news)

September Federal Reserve meeting is the key and not the 31^st July meeting. The surprise (if any) will be a postponement of the interest rate cut to November from September. US presidential candidate Donald Trump wants the Federal Reserve to delay interest rates to the November meeting. So September meeting is more important for all asset classes from a long-term perspective.

We are nearly two months away from the 18^th September Federal Reserve meeting. Jobs and other US economic data of the July and August summer travel season will decide the pace of interest rate cuts for the rest of the year and next year. I am expecting hyper-speculative activity for the next two months in precious metals and base metals and energies and crypto currencies. Day traders protect capital as constant stop loss triggers (if any) can erode capital in a pretty quick time. Medium term and long-term investors do not worry. Pace of rise can slowdown in precious metals and base metals in case global stock are in a red zone for a few weeks.

SPOT SILVER – (Current market price $29.61)

TODAY VIEW: Spot silver has to trade over $29.26 on a daily closing basis till 2nd August (next two weeks) to be in a short-term bullish zone and rise back to $30.75 and $32.01 and more.
Crash or another wave of sell-off will be there if spot silver trades below $29.26.

Disclaimer

The investment ideas provided is purely independent view point and are solely for collective learning and for academic interests. There is no commercial benefit accruing or have deemed to accrue to me out of providing such investment ideas.
The investment ideas shared here cannot be construed as investment advice or so. If any reader is acting on these advices, they are requested to apply their prudence and consult their financial advisor before acting on any of the recommendations made here. I am not responsible to anybody in the event of profits and losses (if any) upon acting on such advice.
I hope that our reader is aware about this well aware of the risk involved in trading in commodity derivative trading.

Disclosure: I trade in India's MCX commodity exchange. I have open positions in India's MCX commodity future. I do not trade in CME future or OTC spot gold and spot silver.

NOTES TO THE ABOVE REPORT