Commerzbank’s Carsten Fritsch highlights extreme volatility in Gold and Silver, with sharp swings over consecutive days and record-high nominal prices. The turbulence has triggered sizeable outflows from Gold ETFs and net reductions in speculative positions on COMEX, while Silver ETFs saw mixed flows. Both metals have retreated to their lowest levels in nearly two years, undermining investor confidence in the short term.

Extreme swings pressure precious metal sentiment

"Precious metal prices have been characterized by exceptionally high volatility in recent days. On Friday, the price of gold rose by just under 4% after falling by a similar amount the day before. Price movements were even stronger for silver, which rose by 10% on Friday."

"Yesterday, gold was trading above USD 5,000 per troy ounce, around USD 400 higher than Friday's low, while silver was trading at more than USD 80 per troy ounce, almost USD 20 higher than Friday's low. The sharp ups and downs in prices over the past week have clearly left their mark on investors."

"Gold ETFs tracked by Bloomberg recorded outflows of around 20 tons last week. This was the first weekly outflow in five weeks and the strongest weekly outflow since the end of October."

"According to Bloomberg, silver ETFs recorded a considerable weekly inflow of 700 tons. However, this is solely due to the massive inflow of almost 1,000 tons at the beginning of last week. In the days that followed, there were also outflows from silver ETFs."

"Trading in a silver fund listed in China had to be suspended for an hour on Friday, and after trading resumed, the price fell by the maximum possibleamount of 10%. This is also likely to have affected investor confidence."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)