Neither of my two favorite precious metal has had a great day in Asia today. Platinum is 2.60% on the day. Palladium all its manifestations Wednesday unwinds in abruptly, plunging 4.35%. I have to go away and think about the latter ...
Like Wednesday it seems that there is no single factor that drives the movement. Liquidity as always plays its part in Asia. Japan has also returned from vacation today, and may be more than coincidence that both co-recovered Wednesday in Asia only to be sold strongly in Asia today.
A "risk on" today buoyant market values and a concentration of oil remain cheerful in the Asian session. Certainly I have my doubts as to the longevity bullish oils much as I did the New Zealand Dollar ability to sustain a significant selloff in a world of zero percent. (See previous articles)
The main reason I suspect is very disappointing data from China today. Both industrial production and retail sales came out on as expected.
- Industrial production (CN) CHINA July M T / M: 0.5% V 0.5% prior; A / A: 6.0% V 6.2% E; YTD A / A: 6.0% V 6.0% E
- (NC) CHINA RETAIL SALES July M / M: 0.8% V 0.9% prior; A / A 10.2% 10.3% V E; YTD A / A 10.3% 10.3% V E
Source: Trade News
Not the bit "as expected" that has the market nervous. The street was looking for the positive numbers to offset a growing concern that the slowdown in China is accelerating, and its target of 6.5% of GDP is in doubt. We all love a good rumor of a Friday and the market required a lot of talk circulating that China could introduce quantitative easing, etc, etc, etc to keep the lights on economically.
This has been a short-term pivot "at risk" negotiation and out of "off risk" with the carry trade as NZDJPY, AUDJPY, USDJPY even high all day. Stock Indices and oil and copper have all the good days as well as Asia keeps a sugar rush to China. As a result, gold, silver, platinum and palladium are overdrawn to varying degrees.
Platinum
Leaving the noise of the day despite Platinum continues to show a very interesting and potentially very bullish technically set in the daily and weekly charts. It seems to be the consolidation of a formation of inverse head and shoulders very large, which, if correct, points to a substantial upturn ahead.
The neckline of platinum is in the area of 1115, and this is now the daily and weekly support. And a weekly newspaper and a break below the consolidation of void formation.
As I said before, it is not typically a period of consolidation above the neckline after a break. Platinum has been doing this for the last two weeks very well. As shown in the graph of the distance from the head to the neckline it is $ 305.60. Therefore from a technical perspective Platinum should soon start raising their merry way to a target of 1415.60. (1110 being the pause)
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