Precious metals prices in the international market rose across the board during the early trading session on February 3rd. By the time the domestic market opened, spot silver had surged over 5% intraday, with its high point briefly reaching above $84 per ounce; spot gold reclaimed the $4,800 per ounce mark, climbing more than 3% during the session. Spot platinum and palladium also advanced by over 2% and 3% respectively.
The precious metals market experienced a comprehensive sell-off last Friday, but regarding the reasons behind the selling, institutional views suggest that although Kevin Warsh's nomination for Fed Chair triggered changes in Federal Reserve policy expectations, the underlying primary cause likely still lies with liquidity pressures and position adjustments. The fundamental backdrop for precious metals has not currently changed, and this, combined with the massive increase in silver ETF holdings on Monday, appears to hint at the market's enduring conviction in precious metals. Rhona O'Connell, Head of Market Analysis for EMEA and Asia at StoneX, stated that the sharp sell-off witnessed in the metals market last Friday, which also ranks as one of the most significant liquidity crisis events in market history, was triggered by the market suddenly forming a clear expectation regarding the future direction of Federal Reserve policy, "An important uncertainty concerning financial and political dimensions has been eliminated." Commodity analysts at Societe Generale also commented that last Friday's price action in metals was not merely a correction but represented a deleveraging event. Such extreme price volatility is sufficient to indicate that it was not driven by fundamental factors but rather by position adjustments, with the catalyst being Donald Trump's nomination of Kevin Warsh for the next Federal Reserve Chair, a development that injected some bullish momentum into the US Dollar. Concurrently, as gold and silver were already in an extremely overbought state, only a slight trigger was needed to spark large-scale selling in a market environment characterized by low liquidity. However, discussing the subsequent trend, the Societe Generale analysts noted that although the uncertainty related to institutional turmoil at the Fed has been removed, the fundamental logic supporting the upward movement of precious metals prices remains unchanged, adding that "a corrective phase could instead be positively significant." The latest perspective from Everbright Futures also concurs that within just two trading sessions, the precious metals market underwent massive volatility described as a "historic plunge," which also served as a mandatory清算 of "squeezing bubbles and reducing leverage" for the previously extreme overbought conditions and overcrowded trades. However, it is important to point out that the long-term core variables supporting precious metals have not reversed; these include the restructuring of the US dollar credit system, the trend towards de-dollarization in reserves, and the normalization of geopolitical fissures. The long-term driving logic remains intact. Following this round of intense adjustment, gold may enter a phase of subdued fluctuations, and further upward movement to challenge new highs will require more time for digestion. Notably, following the record-breaking暴跌 in precious metals, particularly silver prices, on February 2nd, the holdings of the world's largest silver ETF, the iShares Silver Trust, increased by a substantial 1,023.23 tonnes in a single day. Total holdings surged sharply from the previous session's 15,523.36 tonnes to 16,546.59 tonnes, fully replenishing the amount of consecutive reductions seen since January 21st by this ETF. Against this backdrop, domestic precious metals also generally rebounded after opening on the 3rd. Among them, the main silver futures contract on the Shanghai Futures Exchange moved away from its daily decline limit, while the main gold futures contract experienced a rapid upward pull, narrowing its daily loss from over 3% at the close of the night session on the 2nd to less than 1%.
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