GOLD - Futures & ETFs Discussion

This thread is for general discussion and analysis of the listed commodity.


There’s an archived post by @OtherJim that fleshed this trade out nicely. $SBSW has two mining units in South Africa, gold (that’s why I put the post in this thread) and palladium, and both are now on strike. The strike has been priced in by the market as the stock has been channeling in the $16-$17 range. It’s a little $SPY correlated. I traded this last week successfully and am looking for a pullback soon to go in on the same strike.

This article states that demand for palladium will be high for the next couple of years because more production will not come online or take time to come online. More importantly, sanctions against Russian palladium have not started but auto manufacturers who use it for catalytic converters have begun to look elsewhere in the even that sanctions do come down: namely, South Africa.

The flip side to this is that a downturn in the economy could cause a decrease in auto manufacturing and result in a decrease in demand for palladium. However, any forecasts for economic recessions are for the later part of this year or next year.

This is a risky trade but like $DE that had long-lasting labour disputes, any mention of union news would result in pops in price action. I expect the same for $SBSW for the next couple of months and if resolved, should see a big spike up near the $20+ range.