Precious metals were holding ground well earlier this year but while they are often seen as safe haven assets, this is not the case today. Gold is down 2.4%, Platinum 4.9% and Silver a stunning 6% as equity indices sink into the abyss. The reason is that leveraged investors that were relying on cheap funding are forced out of the market that is striving for cash. Precious metals saw heavy net speculator positioning and while these assets can do well amid global slowdown longer-term, this positioning squeeze suppressing prices big time today (well investors can thank central banks for inflating asset prices now). Silver sees a support line at $16.50 but honestly all these supports become irrelevant when prices crash.
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