Commodity markets have emphatically responded to a Trump Presidency. After an early surge precious metals (gold, silver, platinum) have faded lower with gold now trading below the level which it was at on election day morning:
A remarkable chart. Gold spiked to nearly $1340 before tumbling lower almost as fast as it went up. The October low at $1243 now comes back into play.
Looking at a daily chart of gold all that is left to mark the election night hysteria in the gold market is the sensationally long wick and enormous volume on the November 9th daily candlestick:
News that hedge fund legend Stan Druckenmiller, formerly a gold bull, sold all of his gold holdings on the night of the election (presumably into the spike higher) helps to explain some of the sentiment change which has caused gold to reverse lower.
Meanwhile, silver has held up relatively well and remains in an intermediate-term uptrend despite running into resistance at $19.00:
The biggest commodity takeaway in the post-Trump world is copper. Copper has put together a record streak of up days and is trading at 52-week highs above $2.50/lb as I write this:
Other base metals such as nickel and zinc have also caught a healthy bid. This is a clear signal that markets believe the Trump infrastructure agenda will create a strong demand for base metals.
Crude oil has rallied modestly off support along with a strong bid in equities. This is consistent with a strong reflationary trade across markets including a surge in bond yields:
One possible explanation for the relatively modest move in crude oil is that Trump is openly in favor of all forms of energy including coal, natural gas, and nuclear which could take away some of the future demand for crude oil.
It's still early days and Trump is still more than two months from actually taking office but the early indications are that base metals are a big winner, with precious metals getting a much less clear, more confused response from the market.
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