Phil Streible with Blue Line Futures discusses Gold, Silver, Copper, Platinum, and other commodity topics.
Phillip Streible, Chief Market Strategist
AUTO-TRANSCRIBED
Good morning. It’s Friday, December 15, about 6 a.m. Central Time. Overnight, the precious metals are higher after yesterday’s explosive rally. Overnight, you got February gold up ten bucks, 2055, March, silver up $0.10, 2449. March, Copper up one at 390 and January, Platinum up one at 969. So the gold silver ratio also holds at about 83 when it’s been bumping down at about 80.
You’re starting to see silver outperform up at 85, 86 and starting to lag. So it’s kind of in no man’s land right now. So looking at the markets here, some big news that we’ve got coming out today. Basically, the biggest thing is that it is triple witching. This is where all the options expire. This is where this vortex of volatility continues to push markets up.
To get all that put premium to expire, worthless. Now how it will impact precious metals? Not quite sure. We’re starting to see a big rotation. Generally, when you see interest rate cuts occur, the best performing asset class equity wise are small caps because they benefit, they’re able to like refinance and rebuild a lot of their debt structuring. Where you start to see the Nasdaq really fade off here.
Historically, in a low interest rate environment, the Nasdaq has outperformed. But however, over the last year or so, ever since really COVID, we’ve seen this flip of new money coming into the market and they’ve really bid up that magnificent seven. So you got a big rotation that’s kind of going on right now. Other news here, you got crude oil building on its first positive week in two months.
And then again, U.S. equities all bumping up, trying to get to those all time highs. Now, if you look at Treasury, yields are continuing to come down. We’ve got the ten year Treasury yield. That thing got smacked down at 3.9%. And I think that’s really where this kind of latest tailwind on the gold and on precious metals had really bumped up.
So we’ll keep an eye on things here. Something that I am a little bit concerned about. Not really, but we’ll see how things play out. Gold needs to continue to move higher. Same thing with silver. It needs to really continue to move higher because the problem you might have is that if you look at a chart, it looks like, okay, you’ve got that that left shoulder, you’ve got the had where it made that all time high, like 21, 52 and now you’re building.
If we consolidate, you’ll build that right shoulder and tactically you could have a breakdown. So if you’re long precious metals and you caught this big upward upward move, you probably want to trail a stop. And I really think your line in the sand is right around that 2000 mark. If you’ve got additional contracts on. Start using some of these key moving averages to try to stop like say something like the 200 day moving average on silver and then also potentially the 200 day moving average on gold, which is right around 2008.
So again, other than the triple witching, we won’t really had much out here today. Be great going into a weekend. It’s been quite a volatile week here and I’m glad that we were able to hold on to some of these gains. Some people are coming out and they are saying that the Fed is going to backpedal on the pace of the cuts and also the discussion about the cuts.
Phillip Streible, Chief Market Strategist