Monday Metal Movements – Gold, Silver, and Platinum Price News (20 May 2024)

 

Monday Metal Movements | Precious Metal Market News and Analysis (20 May 2024)

Gold’s record-smashing year continues. Gold prices jumped above $2,440 early Monday morning, and the bull market shows few signs of stopping. Adding fuel to gold’s fire is a slew of geopolitical stressors – particularly in the Middle East. The death of Iranian President Ebrahim Raisi made international headlines this weekend, and questions concerning the future of the Iranian regime will play an ongoing role in commodity market speculation. 

Experts point to this development as one major reason why gold prices continued to climb over the weekend. As a major funding source for Hamas on the Gaza Strip and a political opponent to Israel, Iran’s change in leadership could have a tremendous impact on the geopolitical stability of the entire region. Because gold has historically thrived in conflict, the specter of instability continues to drive a record-breaking year for the precious metal. 

Other metals followed suit as gold bulls and renewed uncertainty in Iran drove the asset to a new all-time high. Silver opened the week above the $32/oz resistance line for the first time in over a decade. The gold-silver ratio currently sits at just north of 75.5, signaling that the metal may have more room to climb before correction.

Platinum offered the softest performance among the big three metals this morning, dropping from a recent high of $1,086.40 to $1,060 over the weekend. Platinum performance seems to still be marred by excess platinum hoards collected by automakers during the 2020-23 shortage. 

Read on for a more in-depth analysis and breaking news updates for precious metal markets this week. 

Gold Soars Amid Renewed Uncertainty in the Middle East

Gold remains the biggest story in the precious metals market this week. Despite news that the Federal Reserve is in no rush to cut interest rates, the metal recorded yet another all time high this morning. The precious metal dipped last week ahead of the Consumer Index Report as bulls eyed signs that Fed interest rate cuts may be coming sooner rather than later. Gold prices rebounded following favorable April inflationary data.

This week, geopolitical uncertainty seems to be the main driver behind gold’s latest all-time high. Iranian President Ebrahim Raisi was killed in a helicopter crash over the weekend. Former Vice President Mohammad Mokhber has been named acting President, but lingering questions about the future of Iran threaten regional stability in an already-tense climate. 

Reuters names the Iranian President’s death as one major reason behind gold’s exceptional price-action over the weekend. The news agency quoted Kitco Metals on how Raisi’s death may be impacting precious metal markets: 

Adding to gold’s upside was elevated risk aversion as Iranian President Ebrahim Raisi, was killed in a helicopter crash, analysts at Kitco Metals wrote in a note.

A combination of factors continue to drive gold prices sky-high. Aside from a tumultuous situation in the Middle East, investors are eyeing April inflation data with a heightened optimism that interest rates may be coming in September.

In essence, this weekend was the perfect storm for gold bulls. As gold approaches a pivotal $2,500 psychological resistance level, investors should pay careful attention to both the Federal Reserve and key geopolitical stress-points. 

Gold Market Analysis – Monday, May 20th

The gold market doesn’t seem to be slowing down anytime soon. The precious metal is once again on the rise following renewed uncertainty in the Middle East. As tensions between Israel and Iran continue to grow, the death of Iran’s President introduces yet another element of instability to the world’s biggest oil-producing region. 

Another major key indicator for gold’s price-action will happen on June 11, when the Federal Reserve meets to determine the fate of United States interest rates. Promising news that inflation may be slowing down has increased investor faith that lower rates may be coming in September. Good news from the Fed could certainly push gold past $2,500 per troy ounce. 

In other words, gold’s “perfect storm” is far from over. In the near term, we caution investors to keep their eyes peeled for news out of Iran. Ballooning tensions with Israel or shifting economic policies under the new acting Iranian President could send gold even higher as the market reacts. 

Silver Hits New 12-Year High 

Silver also saw green this weekend. The metal is up nearly $4 since last Monday, marking one of the most significant silver bull-runs in recent history. Silver briefly broke above $32 this morning; that’s the first time silver crested above the key psychological line in over 12 years. Gold’s concurrent rise is good news for silver stackers, as it helps keep the gold-silver ratio to manageable levels. 

Not all analysts are bullish on silver. FX Empire reports that silver’s recent price-action signals could lead to a pullback in the near future. As the metal cruises toward a significant resistance zone, FX Empire analysts claim that a large correction could be coming: 

Nonetheless, today’s high has put silver in a potential resistance zone that could lead to a pullback if not a larger retracement. An intraday pullback is in place at the time of this writing, but trading remains above the halfway point for the day’s range.

Adding to traders’ reluctance to go all-in on silver is its sustained volatility. FX Empire market analyst Christopher Lewis argues that the precious metal is “overbought” – and that its volatility signals a potential “massive unwind” in the short term. 

Silver traders should pay closest attention to the gold-silver ratio. The ratio is just over 75.5 this morning. Expect sell-offs to happen if this figure exceeds 80. Until then, silver is likely to remain volatile in the short term.

Silver Price Forecast – May 2024

Like gold, silver investors are likely to keep the momentum steady heading into the rest of May. Silver has followed gold’s price movements carefully over the past few months, and its new 10-year high is great news for bulls hoping for a breakout year for silver. 

>Going for gold? Silver is shining brighter – InvestmentNews – https://t.co/DAsEFwk5yb #GoogleAlerts

— David Morgan (@silverguru22) May 18, 2024

In the short term, though, expect more volatility out of the silver market. The metal has been exceptionally volatile this year. A reasonable gold-silver ratio may prevent an all-out correction for now, but this could change if the ratio shifts to greater than 80:1. Silver is traditionally more volatile than gold, and this trend is especially true during times of economic and geopolitical instability. 

Platinum Shortages Spark Sustained Gains

Platinum supply shortages have sparked renewed investor interest in the precious metal, which is a pivotal resource for the automotive industry. Reuters reports that 2024 will break a decade-long supply deficit record for platinum bullion. Despite the supply shortage, platinum prices haven’t met bull expectations yet. 

Platinum’s spot price started Monday morning above $1,090 before steadily declining throughout the day. Experts point to the usual suspects for platinum’s exceptional recent performance. A combination of the metal’s 2024 supply deficit, geopolitical tensions, and rumors of Federal Reserve interest rate cuts have helped platinum to ride the wave that’s sent all three main precious metals deep into the green in April and May. 

Despite promising signals, platinum still struggles to gain ground above the $1,100 resistance line. Today’s price-action is a good sign for platinum bulls, and it’s unlikely that the metal pulls back in any meaningful way as the market continues to react to rumors of mass supply shortages this year. 

Still, the impact of spiking demand and diminishing supply on platinum prices is undercut by decreased automotive demand for traditional catalytic converters. Both platinum and palladium are primarily used in high-emissions gas-powered vehicles. The ongoing rise in popularity of electric vehicles – which do not feature catalytic converters – will play a pivotal role in determining the long-term price-action of platinum. 

Some investors are more bullish on platinum’s prospects. Markets Today and the Platinum Investment Council report that this year’s slowdown in electric vehicle demand may boost demand for platinum and palladium. 

#Platinum will remain in a shortage this year as a slowdown in the EV boom supports demand for autocatalysts, according to the World Platinum Investment Council

— Markets Today (@marketsday) May 13, 2024

Investors betting heavy on platinum should keep their eyes on the status of 2024’s supply shortage. Additionally, renewed demand for electric vehicles should be a key signal; high EV demand should be negatively correlated with both short and long-term platinum price performance. Like gold and silver, platinum does function as a safe haven asset. High geopolitical uncertainty may keep platinum demand high – even if global supply increases. 

Platinum Market Analysis For May 2024

Platinum is enjoying an exceptional May and remains up since January of this year. Platinum prices are highly market-dependent, since the precious metal is extremely useful in a variety of industries. In the long-term, we anticipate platinum prices to increase slowly as the market reacts to a combination of supply shortage and geopolitical stressors. 

The short term is likely to meet a mild correction for platinum prices. Investors Observer reports that a “bearish engulfing pattern” has formed in the platinum market. They conclude that platinum’s outlook in the long-term remains very positive, although the “popular reversal signs” on our platinum chart signify that the metal will likely experience significant “turbulence” in the short term. 

Bullion Market Analysis – 5/20/2024

A litany of geopolitical stressors and lingering central bank economic policies have led to an impressive opening to the precious metals market this week. All three major precious metals are up – gold and silver are winning big. Investors anticipating a bull market should pay close attention to three major stress-points: 

• Geopolitics – especially Iranian-Israeli relations 
• Federal Reserve interest rates; and 
• Supply/demand dynamics – especially in the platinum market. 

Strong signals in gold and silver markets mean that the bull run is here to stay now. Be sure to follow-up next week for more breaking precious metal market news.