Looking to the Futures

Among the metals, gold is the top performer, up 28% YTD. After breaking $3,000 for the first time in February, it took less than two months to breach $3,500 (intraday). Factors impacting gold this year include safe-haven demand and dollar weakness. Safe-haven demand is coming from both investors and central banks. Globally, central banks are on track to have net purchases in excess of 1,000 metric tons for the fourth straight year. Weakness in the dollar index ($DXY, -9.2% YTD) has also provided support.

In second place in the metals complex is platinum (/PL, +27% YTD). The metal's use in industrial application ensures a steady demand. In fact, the World Platinum Investment Council forecasts a 966,000 ounce supply deficit for 2025, the third straight year of undersupply. It also can serve as a substitute for gold in jewelry, so a rising gold tide can help lift the platinum boat. The white metal has spent most of the year around $1000 but is up about % over the past two weeks.

Copper (/HG) is in third place, up 24% on the year. Copper prices have been buoyed by tariff news as buyers rushed to secure supplies ahead of possible 25% tariff. Imports of the read metal have more than doubled to around 40,000 tons per week since March. That surge in imports coincided with a spike in the copper price to $5.432, one cent off the all-time high reached last May. Less than two weeks later, it reached a one-year low of $4.088.

Closely trailing copper is silver (/SI), up 23% for the year. While just missing the bronze (sorry), silver is having an exciting year. After reaching a 13-year high in late March, the contract lost 21% in three trading days in early April. Since then, it has rebounded and then some, reaching a new 13-year high of $36.43 today. The story with silver is similar to platinum, with industrial use providing steady demand, along with being an alternative to gold. The current price ratio of silver to gold (available as the PriceRatio study on thinkorswim) is around 93. The ratio was over 100 for much of April and May and is trending toward its long-term average of about 90.

Turning to futures that are in the red for the year, Ether (/ETH) is down 26%. There was a selloff of 64% from the early January high to an all-time low of $1,397.50 in April. That was followed by a rally of 98% in a little over a month. It has since stabilized in a range of $2,400-$2,700.

The second-worst performer in futures this year is crude oil. Both Brent (/BZ) and WTI (/CL) are down over 12%. With crude, the weakness in the dollar has been more than overcome by loose supply. Domestic production has remained strong, averaging 13.5 million bpd which exceeds last year's record of 13.2 million bpd. OPEC+ hasn't been doing crude any favors either. The cartel agreed to increase supply by 411,000 bpd in July, the third month of production increases. The increases represent a gradual reversal of the 2.2 million bpd production cut that OPEC implemented in late 2023.

Gold is trading within 5% of the all-time high found in April. The SMA setup is bullish with the contract above the 9-day SMA after the 9-day crossed above the 20-day last week. The RSI is close to the overbought threshold of 70%. It last breached that level when it made the new record. The MACD is slightly positive. The bottom graph on the chart is the Price Ratio of gold to silver mentioned above.

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New Futures contracts are live! Please be aware that the following products are now available to trade with an approved futures account on all thinkorswim platforms:  

• 1 OZ Gold (/1OZ)
• Solana (/SOL)
• Micro Solana (/MSL) 

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