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Silver melted up on the summer heat hitting the highest level since June the 6th, Copper popped and dropped on reports of record Chinese copper exports. And while they tried to pull back, weak data out of Europe is causing another potential for an upward run.

Bloomberg reported that “Bonds surged after business activity across Europe encountered an unexpected setback, prompting traders to amp up wagers on monetary easing.

The yield on Germany’s benchmark 10-year bonds fell six basis points, dragging the rate on US Treasuries lower after manufacturing and services PMI readings for Europe’s two biggest economies fell short of expectations. Markets moved to price a higher chance of two additional rate cuts from the European Central Bank this year after the separate index for the whole of the euro-zone also dropped more than forecast in June.”

That helped gold break up out of consolation as they are waiting for the Chinese central bank to step back into the buy side of the market as a new central bank buyer is raising eyebrows.

 Palladium had nice bottoming action and platinum was above one thousand for the first time since June 7th. Still, Fed Talk and triple witching are causing some cover the outlook for metals is looking bullish both long term and short term and on pace for a wild summer ride.

Copper was struggling the usual concern was China. Zero Hedge wrote that Cina’s Copper Exports Jump to Record On ‘Export Arbitrage’

They wrote that “Until the Chinese government introduces more robust stimulus packages to counter soft economic data and exporters in the world’s second-largest economy ease up on flooding global markets with copper, prices of the base metal—crucial for power lines and AI data centers—are expected to remain under pressure.

The latest customs data from Bloomberg shows that Chinese exports of unwrought copper and other products in May doubled from last year to roughly 150,000 tons, exceeding the previous high in 2012. This comes as copper prices hit a record high of more than $5.10/lb on COMEX.

Central Banks' buying of gold continues to be a major drive. The World Gold Council wrote that “An increasingly complex geopolitical and financial environment is making gold reserves management more relevant than ever. In 2023, central banks added 1,037 tonnes of gold – the second-highest annual purchase in history – following a record high of 1,082 tonnes in 2022.

Following these record numbers, gold continues to be viewed favorably by central banks as a reserve asset.

According to the 2024 Central Bank Gold Reserves (CBGR) survey, which was conducted between 19 February and 30 April 2024 with a total of 70 responses, 29% of central bank respondents intend to increase their gold reserves in the next twelve months, the highest level we have observed since we began this survey in 2018. The planned purchases are chiefly motivated by a desire to rebalance to a more preferred strategic level of gold holdings, domestic gold production, and financial market concerns including higher crisis risks and rising inflation.

China purchases are being watched closely by gold, But not just China. Thailand is going for the Gold

Jan Nieuwenhuijs of Gainesville Coins wrote “Shedding its long-standing price sensitivity to the price of gold, Thailand is currently a gold buyer driving the price up, just like China

Present changes in the global gold market, in which pricing power is shifting East, could be a precursor to a transformation in the international monetary order. Possibly, trade in the East will settle through a system connecting local CBDCs, while any remaining imbalances are transferred in gold.’

Buying physical gold and silver on pullbacks as well as future strategies for the wild ride along with options are probably a very good way to play this market over the next few months. Call me to get my trade levels and strategies.

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