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Asian Metals Market Update: Do not expect a short term trend to be established

Physical traders of silver and short term investors of silver are using every rise to exit. Silver traders are scared of more price fall. They prefer to play safe and exit on minimal profit. They are switching over to gold once again. Short term hot money is not there in both silver and gold. Silver has to show some serious signs of a sustained rise, to attract more and more investors.

Most people think a firm trend will be there in gold, silver and industrial metals once the result of US presidential elections are declared. Four years ago gold and silver rose sharply when Trump was declared as US president. Gold and silver crashed in less than three weeks after Trump was declared as US president. Crude oil sold off and rose sharply after six weeks of Trump becoming USA president.

One should not expect a short term trend to be established even if the US presidential election winner is declared by Saturday. History suggests that trend in all metals and energies can change every week for the first six weeks. The difference this year is covid crisis. Eurozone and the world are battling second wave of covid.

Traders will start taking positions for Christmas and end January from next week. The usual factors like bond yields, US dollar Index and economy (except China) will be key mover and shaker for gold, silver, copper, nickel and crude oil. I am not seriously looking at the outcome of US presidential elections. My bullish view on industrial metals and silver (for the rest of the year) is based on expectation that international travel will open up in December. Europe and UK are enforcing lockdown in November so that travel and tourism industry does not suffer in Christmas and New Year. Industrial demand for copper, nickel and silver will rise sharply from December on higher consumption demand and additional stimulus by almost every country in the world (except China).

COMEX SILVER DECEMBER 2020 – current price $2409.80

  • November Monthly View: Silver needs to trade over $2210.00 in November to rise to $2673.10 and $2863.70.
  • Silver will move into a bearish phase only if it falls below $2210.00.
  • Immediate resistance is at $2528.00

COMEX COPPER DECEMBER 2020 – current price $308.90

  • November Monthly View: Copper needs to trade over $286.70 to rise to $325.10 and $344.30.
  • Copper will crash in November if $325.10 is not broken.
  • I am against investing in copper at current price and will prefer to wait till 11th November and then decide.

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