I asked if 2024 would be another golden year for the leading precious metal in a January 2 Barchart article. After recapping the price action in 2023, I wrote:
Gold closed 2023 at over $2,070 per ounce as the bull market continued. As gold celebrates its quarter-of-a-century anniversary in a bull market, the prospects for higher prices remain intact.
In Q1 2024, gold reached a new record high, silver rallied, and platinum and palladium prices declined. In the early days of Q2, prices are taking off on the upside, with gold and silver leading the bullish charge.
Gold leads the precious metals in Q1 2024
Gold was the best-performing precious metal in 2023, with a 13.45% gain and this out-performance continued in Q1 2024, as the precious metal moved 7.02% higher.
The chart dating back to the 1970s highlights the bullish trend of higher lows and higher highs over the past twenty-five years. Nearby COMEX gold futures settled Q1 2024 at $2,217.40 per ounce and rose to over the $2,300 level in early Q2.
Silver lags behind gold, but the price moves higher
Nearby COMEX silver futures posted a marginal 0.19% gain in 2023 and moved 3.45% higher in Q1 2024.
The long-term silver futures chart shows that silver futures settled at $24.916 per ounce at the end of March 2024. The price has increased to over $27.50 in early Q2 2024.
Platinum and palladium declined
Platinum and palladium prices fell in 2023, posting 7.33% and 38.3% respective declines.
NYMEX platinum futures fell another 8.77% in Q1 2024, settling at $907.70 per ounce.
NYMEX palladium futures dropped 7.91% in Q1, with the nearby futures at the $1,021.50 level on March 29, 2024.
Platinum was higher at over $940 per ounce in early April, while palladium futures moved just above $1,000 in early Q2 2024.
The action in early Q2 is bullish for the rare metals
Gold and silver continued their bullish paths in early April, while platinum and palladium have also posted gains.
Precious metals tend to be highly sensitive to the U.S. dollar and interest rates, but gains in April come with a steady dollar index, hovering around the 104 level, with little change from the end of Q1. Meanwhile, the U.S. 30-year Treasury bond futures closed Q1 at 120-08 and have declined to the 118-08 level. Therefore, the precious metal’s ascent could have more to do with the declining faith in the dollar and the U.S. bond market.
The turbulent geopolitical landscape remains bullish for the metals that have industrial properties and long histories as safe havens, investment metals, and means of exchange.
Silver could be a huge winner if the price eclipses technical resistance
In a March 3, 2024, Barchart article, I pondered if silver was a sleeping giant, outlining the silver market’s price consolidation. I concluded:
Silver is an undervalued asset based on gold’s price performance. If gold continues to rally and silver can break above technical resistance at the $26 per ounce level, the buying herd could push metal and mining share prices substantially higher. Meanwhile, as the trading range narrows, silver’s potential means the precious metal could be a sleeping giant at the current price level.
May silver futures settled at $23.364 on March 1, 2024. At the $27.50 level on April 5, silver was 17.7% higher, compared with COMEX June gold futures that moved 10.8% higher from $2,116.00 on March 1 to $2,345.40 on April 5. Silver has moved above its first technical resistance level at the May 2023 $26.20 high. The May contract reached $27.615 last week, eclipsing the March 2022 $27.32 peak. Gold and silver futures put in bullish key reversal patterns on their respective daily charts on Friday, April 5.
The next upside targets are $28.68, the May 2021 high, and $30.16, the February 2021 high. If silver is heading above the $30 level, expect trend-following speculators and traders to hop on board a silver freight train that could cause a parabolic move in the traditionally volatile precious metal.
I remain bullish on the precious metals sector in Q2, expecting higher highs in gold, the potential for an exciting breakout in silver, and higher prices for the two platinum group metals trading on the CME’s NYMEX division.
On the date of publication, Andrew Hecht did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
