LONDON (Commodity Online): Gold, contrary to our expectations, shot up on Friday, easily breaking above $950 when New York opened. Gold is holding its ground well above $950 this morning, despite the greenback looking to break below $1.4300 against the euro.

Activity in the physical market has slowed, as the possibility of a technical break-out above $960 looms. This seems to be discouraging the market from taking any large short positions. Gold support is at $941 and $929, and resistance at $961 and $969.

Last week saw the release of Swiss PGM customs data for July. Overall the Swiss customs data remains bearish for platinum. In July, Switzerland remained a net importer of platinum, importing almost 140,961oz platinum. This trend has been going since February. Between February and July, Switzerland’s net import figure for platinum is 592,958oz showing an substantial rise in Swiss stockpiles.

China remains the main driving force behind platinum demand from Switzerland and, apart from China, there is still very little platinum demand from Switzerland. However, we still see very good price support (from a cost perspective) around the $1,100 - $1,150 area.

Our cost curves show that should the ZAR stay around ZAR8/$, the price cannot fall much lower before producers run into major problems. This morning, there’s also the news that the strike at Impala platinum, the world’s second-largest platinum producer, has been called off for now.

Platinum might find it difficult to move much higher. We see support for platinum at $1, 235 and resistance at $1,270. With base metals moving higher, we see good support for silver as well. Copper is trading well above $6,350 after looking to break below $6,000 last week. Should gold support also hold, silver may push higher. Support is at $14.00 and $13.60, and resistance is at $14.60 and $14.70.

Courtesy: Commodities Research, Standard Bank

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