Precious metals are range-bound. There is no data due for release today; we therefore expect trade to remain range-bound.
Our strategy for gold is unchanged: buy dips and sell rallies.

We don’t foresee that gold can yet break out of the $1,150 – $1,100 range in which it has been since the second week of December. As indicated in the Focus, downside support is increasing.

Support is at $1,116 and $1,101, resistance at $1,134 and $1,140. Swiss PGM export data was released yesterday. Switzerland was a net exporter of platinum and palladium in February.

On closer analysis, the Swiss figures for February are bullish for platinum but neutral for palladium. it is encouraging that large consumers such as US and Japan have stopped exporting platinum after many months, which saw metal flow to Swiss vaults.

Also, China has increased its buying again after showing very little buying interest since late last year. Switzerland remains a
large net exporter of palladium. However this is being distorted by large exports to the UK. Platinum and palladium can be
settled Loco London as of Sep’09; as a result, some Zurich stockpiles are set to shift from Zurich vaults to London vaults.

But despite this expected move in above-ground stockpiles, we believe that demand is improving. The Swiss customs data seems to favour platinum relative to palladium.

Platinum resistance is at $1,640, support is at $1,610. Support for palladium is at $460 and resistance at $480. Silver support is at $16.20 and $16.90, resistance at $17.60 and $17.75. As with gold, we believe that silver will remain rangebound.

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