Daily Metals Newsletter

1/26/2016
- Good morning from Chicago Get expert perspective on today's Metals markets from some of the most respected names in the industry. Zaner experts have been quoted in Dow
Jones Newswires, CME, CBOT & MGEX exchange publications, Futures Magazine, Stocks and Commodities Magazine, Forbes, BarChart.com,
Tradingmarkets.com, CommodityTrader.com, Financial Engineering News, Risk Controlled Investing and many other publications. Feel free to call us
at: 312-277-0120 for more information.
Learn more about our Metals services
Note: OTC, Futures, options and forex trading is speculative in nature and involves substantial risk of loss. This material is conveyed as a solicitation for entering into a derivatives
transaction.

52 Week
High

1296.6 on
01/27/15

52 Week
High

18.274 on
01/28/15

52 Week
High

1266.3 on
01/28/15

52 Week
Low

1045.4 on
12/03/15

52 Week
Low

13.620 on
12/14/15

52 Week
Low

811.4 on
01/21/16

20 Day MA 1087.4

20 Day MA 14.000

20 Day MA 858.7

50 Day MA 1077.4

50 Day MA 14.082

50 Day MA 857.5

100 Day
MA

100 Day
MA

100 Day
MA

1106.9

14.673

913.1

PRECIOUS METALS COMMENTARY

01/26/16
China concerns feeds the upward bias in gold and silver
OVERNIGHT CHANGES THROUGH 6:05 AM (CT):
GOLD +6.80, SILVER +11.60, PLATINUM +6.60
Early Gold Change +$8.00 from the prior session.
LME Copper Stocks 237,355 tons -1,450 tons Shanghai copper stocks +8,081 tons to 194,312 tons.
OUTSIDE MARKET DEVELOPMENTS: Global equities were mostly lower overnight in the wake of more Chinese economic concerns and talk of adversity from a strong Dollar. US
economic data flow kicks off with the November US FHFA home price index, which experienced a 0.5% month over month increase in October. There is also data from Case-Shiller home
prices for November that are anticipated to have ticked up from the 5.5% year over year reading in October. A preliminary reading on January service sector PMI is forecast slightly lower
than the 54.3 reading in December. The next US data window presents January US consumer confidence that is forecast to hold steady at 96.5. The January Richmond Fed
manufacturing activity is forecast to have pulled back from the 6 reading in December. The US Federal Reserve begins their two-day policy meeting. The US Treasury kicks off this week's
supply offerings with $26 billion 2-Year Notes auction, which came in at a 1.056% yield at the December auction.
GOLD / SILVER
Gold continues to post very impressive action with another upside breakout on the charts overnight in the face of very sharp declines in Chinese equities. It is possible that gold was
garnering some minimal lift from news that Chinese gold imports via Hong Kong for 2015 reached 861 tons compared to just 813 tons in 2014. It should also be noted that Chinese gold
imports into Hong Kong in December reached the highest level in 3 years! Keep in mind that China in 2015 opened up other gold import avenues on mainland China and therefore Hong
Kong is no longer the only tally of Chinese gold imports. A series of higher lows in the face of fresh anxiety in equities and sharply lower oil prices overnight isn't surprising, as that hints at
a return to crisis mode. The media's attitude toward gold has improved as recent strength in gold is getting more coverage, and they have also noticed inflows into gold derivative holdings
over the last two weeks. However, we think the strongest bullish factor at work in gold is the fact that the BOJ and ECB are showing signs of extending and/or expanding QE, and there is a
portion of the market that thinks the sharp slide in equities and crude oil at the start of 2016 is going to get some attention in the Fed press release or statement later this week. We
ultimately think that the Fed will be mum on their upcoming action, and that they will emphasize their data dependence. Therefore, it is possible that gold will continue to rise but it might
reverse direction on Wednesday afternoon after the Fed statement. In another supportive move "Gld" saw a modest inflow of holdings and we suspect that today will see an even larger
inflow.
PLATINUM
With a major upward extension for platinum coming at the expense of palladium yesterday, it is clear that spread action continues to dominate action in the PGM complex. The platinum
market might have been lifted yesterday as a result of bullish price projections from a Reuter's poll, and it might have been lifted as catch-up to the recent strength in palladium. One has to
wonder if the mining deaths recorded over the weekend will spark unrest and calls for safer working conditions, but at the current time the PGM mining companies are under financial
stress and under pressure from shareholders so costly changes in production will be difficult. However, until there is an actual closure we have to leave spread action as the most dominant
force in the trade. In the short term platinum and palladium appear to be catching some safe haven lift from gold and perhaps the upside breakout on the charts overnight is attracting fresh
trend following fund buys.
TODAY'S MARKET IDEAS: The gold market action is indicative of lingering safe haven sentiment, and to a lesser degree the hope for a pause in US rate hike prospects. Another issue
that is probably contributing to the upward bias throughout the precious metals complex this morning is the idea that China threw in significant liquidity last night and that the BOJ and ECB