Commodities: Record highs for the gold price

The situation in commodity ETC trading has calmed down noticeably. Following the start of the Middle East war, things had become somewhat more turbulent for a short time. The focus is currently on gold in particular, after the precious metal rose to new all-time highs in some currencies.?

9?November 2023. FRANKFURT (B?rse Frankfurt).?The biggest winners in recent weeks have come from the precious metals segment. Gold and silver have made significant gains on balance, although profit-taking has been observed since the beginning of November. "The geopolitical premium has contributed to the gold price rising to its highest level in US dollar terms since May 2023," explains Mobeen Tahir from WisdomTree. Carsten Fritsch, commodities analyst at Commerzbank, also points to the escalation in the Middle East conflict and the resulting demand for gold as a safe haven.

It is also striking that, unlike is often the case, the dollar and bond yields are currently not the most important drivers of price trends. Despite the recent fall in yields, gold was unable to continue its rise in November. "It looks like the gold price has run out of steam at 2,000 dollars for the time being," states Fritsch. J?rg Scherer, technical analyst at HSBC, sees things somewhat differently. According to his analysis, there are several harbingers of gold reaching a new all-time high in dollar terms following the records in euros, pounds and yen. "This would be a real bang for the buck".

Seasonality speaks for a year-end rally

Among other things, the chart technician points to the "striking white monthly candle" in October, which also encloses the bodies of the four previous stock market months. This represents a quadruple bullish engulfing and thus a constructive chart pattern from the candlestick analysis. According to Scherer, the "seasonality" factor provides an additional tailwind, as the price of gold often performs strongly in November/December of a US pre-election year.

According to Leo Puschmann from Lang & Schwarz, commodities trading has been "rather quiet" of late, with Xetra Gold (DE000A0S9GB0) in particular "in high demand" among precious metals. At 218 tons, gold holdings are currently at a high level, although they have fallen slightly compared to the previous month. Overall, according to a current market analysis by Crossflow Financial Advisors, the trend towards sales in the gold ETC segment that has been observed for months has continued. The iShares Physical Gold ETC (IE00B4ND3602) is one of the top 10 most frequently traded gold ETC products across the entire market, with the largest outflows.

Oil price has given up gains again

The price of oil has seen a rapid rise and fall in recent weeks. In the first two weeks after the devastating attacks on Israel by the Palestinian terrorist organization Hamas on 7 October, prices initially rose significantly. In the meantime, however, crude oil is even trading below its level at that time. This is despite the fact that Russia and Saudi Arabia have extended their voluntary supply restrictions until the end of the year, which should lead to a supply shortage. According to the strategists at Deka, the absence of any further escalation in the Middle East has calmed the oil market somewhat.

In addition, weak export figures from China this week have further increased concerns about a slowdown in global demand. Deka analysts expect prices to remain virtually unchanged over the next three months. According to Puschmann, the briefly lively trading in oil products on the Frankfurt Stock Exchange quickly calmed down again. WisdomTree's triple-leveraged ETCs on WTI Crude Oil were primarily traded. Investors were active on both the long side (IE00BMTM6B32) and the short side (IE00BMTM6C49).

Copper with opportunities for recovery

In the industrial metals sector, the price of copper has been able to recover somewhat from its lows over the past two weeks. Overall, the trend this year has mostly been downwards. Thu Lan Nguyen from Commerzbank believes that this weakness is not justified and therefore expects the recovery to continue in the coming months: "In view of the fact that copper, as a metal of electrification, plays an important role in the energy transition, it stands to reason that demand will remain well supported regardless of the economy and will see a significant increase in the medium to long term". Lang & Schwarz also traded leveraged ETCs for copper, such as the WisdomTree Copper 2x Daily Leveraged (JE00B2NFTF36999).

By Thomas Koch , 9?November 2023 ? Deutsche B?rse AG

About the author

Thomas Koch is a CEFA investment analyst, investment specialist for structured products and certified certificate advisor. Since the beginning of 2006, he has been covering events on the capital markets as a freelance journalist.

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