Weekly Outlook for May 21- 25

Following the recent developments in the Greece in which it was decided there will be elections on June 17^th the Euro took a dive and was traded down most of the week against the USD. The recent publications from the U.S including the minutes of the recent FOMC  meeting and the Philly Fed Index may have been among the factors to drag down energy prices while pulling up gold and silver prices.  This upcoming week there are several speeches, publications and events that may affect the financial markets including: U.S core durable goods, the minutes of the recent MPC meeting, GDP of GB for Q1 2012, U.S new and existing home sales, a speech by ECB President Draghi, China’s flash manufacturing PMI, German business climate and U.S. jobless claims. Here is an economic news calendar forecast for May 21^st to May 25^th referring to the U.S., EU, China, Canada, Australia and Great Britain.   


Source; http://www.tradingnrg.com/weekly-forecast-financial-market-economic-calendar-may-21-25-2012/

Big Majority Of Survey Participants See Higher Gold Prices Next Week

Following this week’s bounce from the $1,520s region, most survey participants in the weekly Kitco News Gold Survey expect gold prices to continue to build on late-week gains.

In the Kitco News Gold Survey, out of 33 participants, 23 responded this week. Of those 23 participants, 21 see prices up, while two see prices down, and zero are neutral. Market participants include bullion dealers, investment banks, futures traders, money managers and technical-chart analysts.

A solid majority of participants expect prices to rally next week, especially since June gold futures on the Comex division of the New York Mercantile Exchange held the low set on Wednesday of $1,526.70. Many said the sell-off was overdone so the rebound was in due course.

“Gold made everybody right by the end of the week... bulls, bears, and fence-sitters alike can claim victory. Wednesday’s high-volume capitulation selling successfully … was followed by an impressive rally on Thursday that saw the largest one-day increase in  open interest (16,000 contracts) in quite a long time. Most of the big changes in open interest the past 2-3 months have been declining so a rise of this magnitude indicates money returning to gold. Examples of technical indicators such as this tend to endure the trend so I look for gold to trend a little higher in the week ahead, settling into a $1,600-$1,625-ish range,” said Ken Morrison, editor and founder of online newsletter Morrison on the Markets.

Those who see weakness next week said they think that gold cannot build on these gains and that the rally was nothing more than a short-term bounce in an otherwise down-trending market. Worries about the eurozone, which have pressured gold recently, remain at the forefront, they add.

There were no participants who were neutral on prices

Source; http://www.kitco.com/kgs/goldsurvey_may18.2012.html

Gold & Silver Prices – Daily Outlook May 17

Gold and silver prices tumbled down again during yesterday along with other commodities prices.  The new elections in Greece will be held on June 17. In the meantime the ECB temporarily stopped lending to several Greek banks.

Did the minutes of the recent FOMC meeting suggest another QE program on the way? I don’t think so. 

On a positive note Japan’s GDP expanded by a higher rate than expected of 4.1% in annual terms during Q1 2012 (1% growth in Q-O-Q terms). 

The U.S housing starts rose by 2.6% in April. 

On today’s agenda: U.S. Jobless Claims Weekly Update, Philly Fed Manufacturing Index and Spanish 10 Year Bond Auction will be held. Currently precious metals prices are rising.        

Daily Outlook for May 17th  

Gold and silver prices sharply declined again yesterday and thus both metals completed a four day consecutive fall.  But currently bullion prices are rising. This might be stems from further speculation of the FOMC’s next step and perhaps even the possibly of another QE program. I think it’s too soon to determine whether there will be QE3 in the near future and the current progress of the U.S economy from the GDP and Labor point of view doesn’t seem to warrant another stimulus plan. The progress in Japan’s economy might also play a role in the rally of commodities prices. Finally the upcoming U.S reports mainly the Philly Fed and Jobless claims may affect not only the US dollar but also bullion market. 

Here is a reminder of the top events and reports that are planed for today and tomorrow (all times GMT):

Today

Tentative – Spanish 10 Year Bond Auction

13:30 – U.S. Jobless Claims Weekly Update

15:00 – Philly Fed Manufacturing Index

15:30 – EIA U.S. Natural Gas Storage Update

Tomorrow

Tentative – GB 10 Year Bond Auction

13:00 – Canada’s Core CPI

All Day – G8 Meeting

Source; http://www.tradingnrg.com/gold-prices-outlook-silver-forecast-thursday-may-17th-2012/

Gold & Silver Prices – Daily Outlook May 16

Gold and silver prices continued their downward trend during yesterday’s trading despite the slightly positive news of the higher than expected growth rate of Germany’s GDP in the Q1 2012 (a  growth rate of 0.5%); the news of the new elections in Greece to be held in June raised the anxiety in the markets and dragged down the Euro. This news may continue to affect the forex and commodities markets in the days to follow. On today’s agenda: the minutes of April FOMC meeting, U.S housing starts report, Bank of England’s Governor King speaks, ECB President speaks, Japan’s Preliminary GDP 1Q2012, Euro Area Annual Inflation, German 10 Year Bond Auction will be held and BOE Inflation Report . Currently precious metals prices are plummeting.        

Here is a reminder of the top events and reports that are planed for today and tomorrow (all times GMT):
Today
Tentative – German 10 Year Bond Auction
10:00 – Euro Area Annual Inflation (April)
10:30 –Bank of England’s Governor King speaks
10:30 –BOE Inflation Report
13:30 – U.S. Housing Starts
13:30 – U.S. Building Permits
15:00 – ECB President Draghi Speaks
15:30 – U.S Crude Oil Stockpiles Report
19:00 – FOMC Meeting Minutes
23:50– Japan’s Preliminary GDP 1Q2012

Tomorrow
Tentative – Spanish 10 Year Bond Auction
13:30 – U.S. Jobless Claims Weekly Update
15:00 – Philly Fed Manufacturing Index
15:30 – EIA U.S. Natural Gas Storage Update

Source; http://www.tradingnrg.com/gold-prices-outlook-silver-forecast-wednesday-may-16th-2012/

Weekly Outlook for May 14 – 18

Following the results of the French and Greek election the market reacted to this news as the Euro declined during the week and dragged along with it other currencies such as the Aussie dollar and also commodities prices such as oil and gold.  This week several bond auctions will be held that could affect the Euro and signal the market sentient towards the current situation in Europe. There are several other speeches, reports and news items that may affect the financial markets including: U.S core CPI report, the minutes of the last Australian monetary policy meeting, speech of ECB President Draghi, Japan and Euro Area’s GDP report, Germany ZEW economic sentiment, Philly Fed index and U.S. jobless claims. Here is an economic news calendar forecast for May 14^th to May 18^th referring to the U.S., EU, Japan, Canada, Great Britain and Australia.   

(All times GMT):

Monday, May 14^th
 

10:00– Euro Area Industrial Production: This report will present the changes in the industrial production of the EU during March; in the previous report the EU industrial production was up by 0.5% (M-O-M) during February;

16:45 – SNB Chairman Jordan’s Speech: the Swiss National Bank Chairman will hold a press conference; if he will announce of a sharp shift in the monetary policy of the SNB it could affect the Swiss Franc;

Tentative – Italian 10 Year Bond Auction: the Italian government will issue a bond auction; the previous bond sales, which were held at the last week of April, went well as the rate reached 5.84%;

12:30 – Monetary Policy Meeting Australia’s Bank: The minutes of the monetary policy meeting of the reserve bank of Australia presents the main factors that affected the board’s decision to cut the basic interest rate by 0.5 percent points to 3.75%; the minutes of this meeting may affect the Australian dollar currency and consequently major commodities prices including crude oil and gold prices;

Tuesday, May 15^th

10:00 –Euro Area ZEW economic sentiment: The upcoming publication will refer to the ZEW indicator of economic sentiment for Euro Area for May 2012. For April 2012 the ZEW indicator for Euro Area rose to 13.1;

10:00 –German ZEW economic sentiment: The upcoming publication will refer to the ZEW indicator of economic sentiment for Germany for May. During April the ZEW indicator for Germany slightly rose to 23.4; as Germany’s economy is keep showing progress, the Euro will plausibly remain strong against other currencies;

10:00– Euro Area GDP 1Q2012 Report: Germany France and Italy will also publish during the day their preliminary first quarter GDP report for 2012. This report will present the developments in the economic growth in these countries; Euro Stat will also publish the GDP growth rate of the Euro Area. According to the previous report, during the fourth quarter of 2011, the Euro Area GDP contracted by 0.3% (Q-o-Q). This news might affect the Euro; the current expectations are of another a low growth rate or even another contraction for the first quarter; if there will be another contraction then technically it will mean Euro Area is in a recession;

13:30 –U.S Core Consumer Price Index: This monthly report will refer to the main changes in the core consumer price index for April 2012. In the latest U.S PPI report the PPI declined by 0.2% (mainly due to the drop in oil prices), while the core PPI rose by 0.2%. This might suggest the same could be for the upcoming CPI report.  According to the U.S Bureau of Labor statistics during March 2012, the CPI rose by 0.3% (M-o-M) and also increased over the last 12 months by 2.9%; the core CPI rose last month by only 0.2%;

14:00 – U.S. TIC Long Term Purchases: The Treasury International Capital report will show the main changes in the purchases and sales of US long term treasuries in March 2012. In the previous report regarding February 2012, the net foreign sales of U.S Treasuries longer-term notes reached $10.1 billion;

Wednesday, May 16^th

Tentative – German 10 Year Bond Auction: the German government will issue a bond auction;

10:00 – Euro Area Annual Inflation (April): the inflation in Euro Area reached 2.7% in March (flash report), i.e. it remained unchanged from February 2012. the flash report for April the inflation rate edged down to 2.6%; If the upcoming inflation rate estimate will confirm the flash report’s figure, it may raise the chances of an additional ECB interest rate reduction in the next ECB rate decision or issuing another LTRO program or resuming the securities markets programme (SMP);

10:30 –Bank of England’s Governor King speaks: The governor of Bank of England will speak in a press conference and his speech could offer some insight to the recent BOE interest rate decision and monetary policy; this speech may affect the British Pound trading;

10:30 –BOE Inflation Report: Bank of England will publish its quarterly inflation report; this report may affect the British Pound; in the previous report the inflation sharply fell from its peak in late 2011;

13:30 – U.S. Housing Starts: the U.S Census Bureau will report on the U.S housing starts for April 2012; this report was historically correlated with gold price – as housing starts fell, gold prices tended to rise the following day (even when controlling to the U.S dollar effect); in the previous update, the adjusted annual rate reached 654,000 in March 2012, which was 5.8% below February’s rate of 694,000;

13:30 – U.S. Building Permits: The previous report building permits increased by 4.5% (M-o-M) in the adjusted annual rate of building permits and reached 747,000 in March 2012. If this report will continue to show strength in the building permits rate, it may indicate that the U.S housing market (from this aspect) is slowly recovering (the recent U.S building permits and housing starts review);

15:00 – ECB President Draghi Speaks: Following the ECB rate decision to keep the policy unchanged and the interest rate at 1% the President of the European Central Bank, Mario Draghi will talk in the  European Central Bank colloquium; the title of his speech is “Monetary Policy in Unconventional times“;

15:30 – U.S Crude Oil Stockpiles Report: the EIA (Energy Information Administration) will publish its weekly update on the U.S oil and petroleum stockpiles for the week ending on May 11^th; in the previous weekly report for May 4^th, stockpiles rose by 1.5 million bl to 1,767.05 million bl;

19:00 – FOMC Meeting Minutes: Following the recent FOMC meeting, in which it was decided to keep the monetary policy unchanged, the market didn’t react to this news as gold and silver prices only slightly rose. The minutes of the FOMC meeting might bring some insight behind this decision regarding the future steps of the FOMC;

23:50– Japan’s Preliminary GDP 1Q2012: Japan continues to demonstrate weakness as its gross domestic product shrunk by 0.6% during the fourth quarter of 2011, but expanded by 1.5% during the third quarter of 2011 (in annul terms). The steps taken by BOJ to jumpstart the economy don’t seem to positively affect much Japanese economy for now. This news could affect the strength of the Japanese Yen;

Thursday, May 17^th

Tentative – Spanish 10 Year Bond Auction: Spain will issue a bond auction; following the ongoing economic slowdown and the perils Spain is facing from economic perspective, this bond sale may signal the confidence of traders in the Spanish economy and thus may affect the Euro Market;

13:30 – U.S. Department of Labor– Jobless Claims Weekly Update:  this update will refer to the weekly developments in the initial jobless claims for the week ending on May 12^th; in the previous report the jobless claims edged down to 367,000; this upcoming weekly update may affect the direction of the U.S dollar and consequently commodities;

15:00 – Philly Fed Manufacturing Index: This monthly survey presents an estimate for the developments of the US economy as it measures the manufacturing conditions. In the previous April survey, the growth rate moderately declined from +12.5 in March to +8.5 in April 2012. If this trend will continue this index may adversely affect not only U.S Dollar but also American stock indexes, oil and gold prices (the recent Philly Fed review);

15:30 – EIA U.S. Natural Gas Storage Update: the EIA weekly report of the U.S. natural gas market will refer to the recent changes in natural gas production, storage, consumption and price as of May 11^th; in the previous report, natural gas storage increased by 30 Bcf to 2,606 Bcf; if the natural gas storage will keep rising as a slower than normal pace, it may help sustain the recent rally of U.S natural gas prices in the near future;

Friday May 18^th

Tentative – GB 10 Year Bond Auction: the Great Britain government will also issue a bond auction; in the previous auction back from April 3^rd the actual rate reached an interest rate of 2.22;

13:00 – Canada’s Core CPI: This report will pertain to the core consumer price index for April 2012 and controlling the volatile components such as energy, fruit and vegetables. According to the Canadian CPI report for March 2012, the CPI increased by 1.9% during the past 12 month up to March – this is a lower rate than in February; the core CPI excluding food and energy rose by 1.9% from March 2011 to March 2012. This report might affect the path of Canadian dollar, which is also strongly correlated with commodities prices;

All Day – G8 Meeting: this meeting will be held over the weekend (Friday and Saturday); if the G8 countries will come up with big headlines from this meeting it may have some effects on the financial markets;

Source; http://www.tradingnrg.com/weekly-outlook-financial-market-economic-calendar-may-14-18-2012/

Reminder of the top events

Tomorrow 15/05/2012
10:00 –Euro Area ZEW economic sentiment
10:00 –German ZEW economic sentiment
10:00– Euro Area GDP 1Q2012 Report
13:30 –U.S Core Consumer Price Index
14:00 – U.S. TIC Long Term Purchases

Precious Metals Shares Recoup Losses, XAU Rebounds

Friday, May 11, 2012, 12:48pm EDT Written by GoldAlert Staff.

Gold and silver shares bounced back from earlier losses on Friday despite continued weakness in precious metals.

The Philadelphia Gold & Silver Index – comprised of the world’s largest precious metals producers – initially fell as much as 1.5% to 151.07 but later rose back toward unchanged at 153.44 in mid-day trading.  Nonetheless, the XAU remains near a multi-year low and is on pace for a weekly loss of 2.1%.

The sector’s rebound coincided with the broader equity markets, as the S&P 500 Index climbed back from a 0.7% hole at 1,348.89 to as high as 1,365.66.  The U.S. Dollar Index concurrently pared its gains but remained fractionally higher at 80.150 early this afternoon.

The dollar’s stability helped keep a lid on precious metals, which pared their losses but remained in negative territory. COMEX gold futures for June delivery retreated $10.20, or 0.6%, to $1,585.30 per ounce while COMEX silver futures for July delivery slipped $0.21, or 0.7%, to $28.97 per ounce.

Notable gold and silver shares moving higher on Friday included Goldcorp (GG) and Silver Wheaton (SLW) – which advanced by 0.4% to $35.49 and by 1.1% to $26.79 per share, respectively.

On the downside, Agnico-Eagle Mines (AEM) dropped by 0.7% to $37.45 while Pan American Silver (PAAS) slid 1.6% to $16.74 per share.

Source; http://www.goldalert.com/2012/05/precious-metals-shares-recoup-losses-xau-rebounds/

Survey Participants Divided Over Views On Gold Market Direction Next Week

This week’s sharp sell-off and China’s weak data have survey participants in the Kitco News Gold Survey split on the direction for prices next week.

In the Kitco News Gold Survey, out of 33 participants, 24 responded this week. Of those 24 participants, nine see prices up, while seven see prices down, and eight are neutral. Market participants include bullion dealers, investment banks, futures traders, money managers and technical-chart analysts.

Those who see higher prices said gold is due for a rebound after this week’s sharp losses. Several called gold oversold, along with the broader market. 

Those who see weaker prices said there’s little around to support prices at current levels and that momentum is lower. If the Greeks cannot form a coalition government, that will add to uncertainty and weigh on gold prices as the euro falls and the dollar rallies. 

Ira Epstein, director of the Ira Epstein division of The Linn Group, said with no new headlines about Iran and given that gold hasn’t been able to rally on the sovereign-debt issues in Europe or politics there, something else happening. “In this case, it’s the (technical) chart action and choices investors are making. Investors are or have moved into bonds, notes, the dollar, yen and at times, stock indices. They are not driving gold or silver prices up…. Ultimately I think gold ends up sharply higher, but not now nor necessarily this summer. Therefore I think opportunity lies on the short side of the market.”

Survey participants who are neutral said they are being cautious and waiting on the sidelines to see how current events play out, regarding Europe’s political issues.

Source; http://www.kitco.com/kgs/goldsurvey_may11.2012.html

The top events and reports

Here is a reminder of the top events and reports that are planed (all times GMT):

10/05/2012
Tentative –China’s Trade Balance
Tentative –OPEC Monthly Report
12:00 – Great Britain Bank Rate & Asset Purchase Plan
13:30 –American Trade Balance
13:30 –Canadian Trade Balance
13:30 – U.S. Department of Labor– Jobless Claims Weekly Report
14:30 – Bernanke Speech
15:30 – EIA U.S. Natural Gas Storage Report




11/05/2012
Tentative –IEA monthly oil report
09:30 – Great Britain PPI Input
13:30 – Canada Unemployment Rate and Employment Report
13:30 – U.S. Producer Price Index

Gold & Silver Prices – Daily Outlook May 9th 2012

Daily Outlook for May 9th  
Gold and silver prices tumbled down yesterday and at least for gold yesterday’s decline by over 2% was the sharpest single day fall since April 4^th when the FOMC minutes of the previous meeting was published. This time the tumble may have been stem from the recent developments in Europe as stated above. In many cases in the past after a sharp fall, there used to be a correction. I speculate that all things being equal gold and silver prices will continue with their  general downward trend during the day.
Here is a reminder of the top events and reports that are planed for today and tomorrow (all times GMT):

09/05/2012
00:30 – Japan Current Account
15:30 – U.S Crude Oil Stockpiles Report
18:00 – 10 Year Bond Auction
2:30 – Australia Rate of Unemployment

10/05/2012
Tentative –China’s Trade Balance
Tentative –OPEC Monthly Report
12:00 – Great Britain Bank Rate & Asset Purchase Plan
13:30 –American Trade Balance
13:30 –Canadian Trade Balance
13:30 – U.S. Department of Labor– Jobless Claims Weekly Report
15:30 – EIA U.S. Natural Gas Storage Report

Source; http://www.tradingnrg.com/gold-prices-outlook-silver-price-forecast-wednesday-may-9th-2012/

Chinese Gold Imports Soar 587% in Q1

While the price of gold has not performed particularly well since reaching its $1,923 all-time high in September 2011, this has not deterred Chinese citizens from accumulating the yellow metal.

The Census and Statistics Department of the Hong Kong government reported that during the first quarter of 2012, imports of gold from Hong Kong to China were 135,529 kilograms (135.53 metric tons) – a 587% increase over the 19,729 kilograms imported from January through March of 2011 – according to Bloomberg.

The story went on to say that “Demand has climbed in the world’s second-largest economy as rising incomes and curbs on property speculation boosted purchases. China may become the biggest user annually this year, according to a forecast from the producer-funded World Gold Council. Last year, total Indian demand including for jewelry and investment was 933.4 tons to China’s 769.8 tons.”

Nick Trevethan, senior commodities strategist at Australia & New Zealand Banking Group Ltd, commented that “We’re looking at another solid year for Chinese demand based on these early numbers.  While it’s largely related to price, negative real interest rates should keep demand strong.”

Liang Ruian, a director at Pinpoint Investment Consulting Ltd. in Beijing, stated that “Summer is usually the low season for gold consumption.  If we can see growth even in the low season, it represents the resilient nature of China’s gold consumption.”

Source; http://www.goldalert.com/2012/05/chinese-gold-imports-soar-587-in-q1/

Dampak Masalah Yunani Terhadap Pergerakan Forex dan Emas Hari Ini

Rabu, 09 Mei 2012

Jam Posting 09:52 WIB

Dear Investor,

Jam 6.15 dan jam 20.45 berita mengenai FOMC Member Lacker Speaks, yang akan membahas mengenai kebijakan moneter untuk masa yang akan datang.

Jam 21.30 berita mengenai Crude Oil Inventories, yang mempengaruhi mata uang USD , diprediksi turun.

Jam 21.45 berita mengenai FOMC Member Pianalto Speaks, yang akan membahas mengenai kebijakan moneter untuk masa yang akan datang.

Pergerakan forex dan emas masih melihat kondisi yang terjadi di Uni Eropa terutama masalah Yunani. Akibat parahnya ekonomi di Yunani, Negara tersebut SEPERTINYA akan dikeluarkan dari Uni Eropa. Hal ini tentunya mengagetkan para investor sehingga mereka segera mengantisipasi hal ini dengan melakukan aksi jual. Mengapa emas turun drastic di bandingkan mata uang ? Karena terjadi Panic Selling dikalangan para investor emas. Sebagaimana kita ketahui bahwa pergerakan emas lebih besar fluktuatifnya dibandingkan forex sehingga para investor emas ramai-ramai melepas investasi emasnya.

Fokus saat ini adalah terus perhatikan situasi yang terjadi di Eropa terutama Yunani. Bila emas tidak menembus 1595 lagi, diprediksi emas akan kembali naik hingga 1607-1614. Tapi jika tembus 1595, maka emas bisa jatuh lagi ke 1580 hingga 1566.

Source;http://forexsimpro.wordpress.com/2012/05/09/dampak-masalah-yunani-terhadap-pergerakan-forex-dan-emas-hari-ini/

Looming Eurozone Crisis 'Defining Factor' For Gold

The price of gold took a slight dip in the wake of Europe’s election mayhem on Sunday. Regardless, there was a telling uptick in safe-haven demand for the metal. Look no further than Europe to realize why that might be. Europe is in tatters, to say the very least, and there are growing signs to suggest that Greece was only a mere appetizer. The European cauldron continues to boil incessantly and has escalated in such a manner that has made gold look very, very appetizing indeed.

In the words of David Rosenberg, chief economist and strategist at Gluskin Sheff & Associates in Toronto, “Europe is a mess: politically, economically and fiscally”. For a while now, European leaders have been pushing for austerity measures and it has become painfully evident; not only have these measures failed, they have in fact exacerbated the problem.

“Immediate austerity, in recessionary economies, simply doesn’t work”, according to David Kelly, chief market strategist at J.P. Morgan.Stimulus payments have in the past been successfully repaid in growth; look no further than the recent revival of the American automobile industry. But the euro-zone is one with multiple causalities. You can’t expect austerity measures to successfully allow Greece to grow out of its debt, not in the least when 7 other economies in the Euro-zone are also in recession. The election of François Hollande has now compounded Greece’s problems by significantly clouding the outlook for the country. It remains to be seen if his actual drive against austerity will prove as powerful as his election rhetoric would make it seem. If so, there is statistical chance that Greece may eventually leave the euro-zone.

But it is perhaps telling that Greece has already taken a backseat as others have stolen the spotlight, emblematic of the expanding economic disrupt. Spain has become the new Greece. Unemployment in Spain is now amongst the highest in the developed world, totaling 24.4 percent, and the majority of those affected are in their early twenties, the generation of the future. Of the €298 billion in Spanish loans tied to property developers, more than 20 percent are non-performing. Spain’s banking sector is deteriorating rapidly and the country is facing widespread political unrest. Standard & Poor’s decision to downgrade Spain’s sovereign credit rating to BBB+ should have come as no surprise, but nonetheless, it sent the alarm bells ringing. The move will have a dire impact on Spain’s borrowing costs and will set interest rates sky high as investors seek to compensate for the higher risks involved.

Belgium, Ireland, Italy, the Netherlands, Portugal, Greece, Slovenia are also in recession. Beyond the euro-zone itself you can add Denmark, Czech Republic and now the UK to that list. Mr. Rosenberg stated, “in less than two years, we are now up to a total of seven European leaders or ruling parties that have been forced out of office, courtesy of the spreading government debt crisis…even Germany’s coalition is looking shaky in the aftermath of the faltering state election results”. The crisis has been escalating for two years now, and although it has compelled Asian and North American economies to distance themselves in a bid for damage limitation, there is only so much that can be prevented. If Europe further deteriorates, there will likely be far-reaching implications on the global economy.

For now, US treasuries, the US dollar and German bonds are still considered safe-havens for investors. But if the euro-zone crisis rapidly escalates, that might change very fast. That is why it was telling that today’s markets saw a slight uptick in safe-haven demand for gold. Many are already positive that gold is in for another bull cycle. What is certain is that Europe, and the course it takes over the next few weeks and months, will prove the defining factor for gold.

Source; http://www.wealthwire.com/news/metals/3151

Gold & Silver Prices – Daily Outlook May 8th 2012

Gold and silver prices resumed their downward trend on Monday as they have declined in the past five out of sic business days. The results in the French and Greek elections may have had a slight negative effect on the Euro, which in turn may have also adversely affected commodities prices. Despite the decline in gold prices, China’s imports of gold from Hong Kong continue to surge in the first quarter of 2012.  Currently gold and silver prices are tumbling down.       

On today’s agenda: Australian trade balance report, ECB President speaks and Australian annual budget release. 

Here is a short analysis for gold and silver prices for Tuesday, May 8th:

Gold and Silver– May Update

Gold price slipped on Monday by 0. 37% to $1,639.1; silver also declined by 1.02% to $30.12. During the month gold decreased by 1.51% and silver by 2.88%.

In the chart below are the normalized prices of bullion during the past few weeks (gold and silver are normalized to 100 as of April 30^th).

 

The ratio between gold and silver slipped to 54.42. During the month the ratio rose by 1.41% as gold has moderately outperformed silver during the month. In the chart below are the changes of this ratio during May.

 

Australian Trade Balance Deficit Rose Again in March 2012

According to the recent report regarding March 2012, the seasonally adjusted balance of goods and services expanded from a deficit of $754 million in February 2012 to a $1,587 million deficit in March 2012.

The export of non-monetary gold rose again by $75 million (6%); as gold exports continue to expand, this might suggest a rise in demand for non-monetary gold despite the recent decline in gold prices;

On Today’s Agenda

ECB President Draghi Speaks: Following the ECB rate decision to keep in unchanged at 1% the President of the European Central Bank, Mario Draghi will speak; his speech may include the recent events in Europe and may talk about the ECB’s monetary plan if he will refer to implementing LTRO 3 this may affect the Euro/USD, which is strongly linked with gold and silver prices;

Australian Annual Budget Release: this report will outline the government budget of Australia for 2012; if there will be a hike in the budget deficit it could have an adverse effect on the Aussie dollar;

Foreign Exchange / Gold & Silver Market – May Update

The Euro/U.S Dollar slipped again on Monday by 0.24% to 1.3051. During the month so far the Euro/U.S Dollar decreased by 1.42%; on the other hand, the Canadian dollar and Aussie dollar slightly appreciated on Monday against the U.S. dollar by 0.29% and 0.17%, respectively. Since the Euro, Aussie dollar and Canadian dollar are strongly and positively correlated with gold and silver prices (see the chart below for the linear correlations among these currencies of the daily percent changes during April and May), if the U.S dollar will appreciate against these exchange rates; this may continue to affect gold and silver prices to decline. Currently the Euro is decreasing against the USD.

Here is a reminder of the top events and reports that are planed for today and tomorrow (all times GMT):

Today
2:30 – Australian Trade Balance
10:30 – Australian Annual Budget Release
15:30 – ECB President Draghi Speaks

Tomorrow
00:30 – Japan Current Account
15:30 – U.S Crude Oil Stockpiles Report
18:00 – 10 Year Bond Auction
2:30 – Australia Rate of Unemployment

Source; http://www.tradingnrg.com/gold-prices-outlook-silver-price-forecast-tuesday-may-8th-2012/

Futures market survey: 75 pct negative about Shanghai gold on Mon.

About 75 percent futures experts surveyed by the China Finance Corporation, a financial information provider run by Xinhua News Agency, are bearish about gold futures traded on the Shanghai Futures Exchange (SHFE) on Monday, while 25 percent expect range-bound trading of the commodity.

The benchmark gold contract, for June delivery, opened 0.75 yuan higher at 335.34 yuan/g on Monday morning. 

Futures experts here include futures brokers, research institutions and other market observers. 

The futures brokers that expect range-bound trading of Shanghai gold include Dadi Futures. 

The futures brokers that are bearish about Shanghai gold include Galaxy Futures, Yide Futures and China Futures. (Edited by Wang Li, wangle1@xinhua.org).

Source; http://www.individual.com/storyrss.php?story=156558801&hash=24b62038f0a162ebd5d2bedf7526181c

No Strong Consensus On Gold's Direction For Next Week In Survey

There’s a lack of definite consensus in for survey participants the Kitco News Gold Survey in their outlook for prices next week, with bullish and bearish traders largely split.

In the Kitco News Gold Survey, out of 33 participants, 22 responded this week. Of those 22 participants, 10 see prices up, while eight see prices down, and four are neutral. Market participants include bullion dealers, investment banks, futures traders, money managers and technical-chart analysts.

Most participants who see higher prices next week cite the lower-than-expected U.S. unemployment figures released Friday as a reason to think the Federal Reserve may be seek to launch a third round of quantitative easing sooner than later. 

Interestingly, those who see lower prices also cite the jobs data, but have a different view, suggesting that gold’s inability to rally on the poor data means the market will likely test the downside. Also, a few who see weaker prices said renewed worries from Europe, particularly ahead of the weekend elections in France and Greece will be problematic for gold. Voters are likely to turn away from austerity programs in Europe, which will pressure the euro currency and support the U.S. dollar, weighing on gold.

Frank Lesh, futures analyst at FuturePath Trading, said he sees the gold market trade as sideways with a downward bias, based on technical charts. There’s little fundamental news to push the market out, either.

“Uncertainty about the economies of the U.S., Europe, and China, and their interest rate policies will keep these markets in a holding pattern until there is more clarity. I do see that investment demand is not as strong as it used to be and this is because no one has made any money holding positions long this year. Most futures traders are now content to trade this market, long or short, and not hold positions,” Lesh said.

Those who are neutral on gold cite the fact the market remains trapped in the range it has carved out for the past several weeks and see no reason that gold will break out. 

“The June (gold futures) contract was unable to follow-through on its bullish technical patterns from last week. The likely range is between $1,623 and $1,672,” said Darin Newsom Telvent DTN senior analyst. 

Source; http://www.kitco.com/kgs/goldsurvey_may04.2012.html

Happy Labour Day!

HSBC: Reopening Of Indian Jewelry Shops Provides Lift For Gold

The reopening of Indian jewelry shops provided a boost for gold prices, says HSBC precious-metals analyst Jim Steel. Jewelers ended a 20-day protest against a doubling of the import tax on gold from 2% to 4% and introduction of an excise tax of 1% on unbranded gold jewelry.”Most jewelry stores have resumed operations on optimism that concessions will be made by the Indian finance minister, Pranab Mukherhee, to roll back the excise-tax portion of the tariff Hike,” Steel says. “The majority of India’s jewelry industry comprises of small shops and of the two tax increases, the excise tax is viewed as more onerous for smaller jewelry stores to comply with, according Indian merchants…Since the protest began, interest in alternative forms of bullion indicates the level of pent-up demand for gold and the resumption of the Indian jewelry market as shops reopen is gold bullish, we believe.” Gold also rose in the aftermath of Friday’s softer-than-forecast report on U.S. non-farm payrolls, suggesting some investors have increased expectations for another round of quantitative easing by the Federal Reserve, HSBC adds. As of 4:29 p.m. EDT, Comex June gold was $12.60, or 0.8%, higher at $1,642.70 an ounce. 

Source; http://www.kitco.com/reports/kitcoNewsMarketNuggets20120409_a.html

Major Of Survey Participant See Gold Rising Next Week

Friday March 30, 2012 12:09 PM 

Higher prices are expected in the gold market next week, according to a survey of participants in the weekly Kitco News Gold Survey.

In the Kitco News Gold Survey, out of 32 participants, 22 responded this week. Of those 22 participants, 13 see prices up, while six see prices down, and three are neutral. Market participants include bullion dealers, investment banks, futures traders, money managers and technical-chart analysts.

Several of those looking for higher prices next week cited technical chart factors. Mark Leibovit, editor of VR Gold Newsletter, said he favors gold, in part based on the calendar. 

“Seasonal trends into May are positive, so I'm giving the upside the benefit of the doubt,” Leibovit said.

Phil Streible, senior commodities broker at R.J. O’Brien, also offered a firmer outlook based on technical charts. “Gold prices should start to rally after holding key levels at $1,650 and $1,635, we would expect resistance near $1,680 the 200-day moving average and $1,700 (the psychological level),” he said. 

Those who see weaker prices said the continued lack of physical demand is putting weight on prices. The Indian jeweler strike persists and Chinese buying has been lackluster, analysts said. Further, with no bullish news to drive investors into gold, the metal could soften further.

The few neutral participants are staying on the sidelines, looking for a trend to be established.

Source; http://www.kitco.com/kgs/goldsurvey_march30.2012.html

Is gold overpriced relative to other commodities?

Gold stocks are quite popular among hedge funds these days, and with good reason. John Paulson , who is very bullish about gold, made $5 billion by betting on gold in 2010. As of December 31, 2011, the largest position in the 13F portfolio of his Paulson & Co was the gold exchange-traded fund (ETF) SPDR Gold Trust GLD -1.06% , in which Paulson had over $2.6 billion invested. 

Besides Paulson, there were 55 other money managers bullish about SPDR Gold Trust. In total, they had $8.2 billion invested in the position. 

Another gold ETF, Market Vectors Gold Miners ETF GDX -1.96% , was also popular with hedge funds. It was held by 41 hedge funds at the end of last year. In addition to ETFs, hedge funds were also bullish about companies engaged in producing gold, such as Barrick Gold Corporation ABX -1.48% and Newmont Mining Corp NEM -1.89% . There were over 40 hedge funds with these two positions in their 13F portfolios at the end of 2011. 

For instance, David Einhorn 's Greenlight Capital had $60+ million invested in Barrick while Jim Simons ' Renaissance Technologies had nearly $90 million invested in Newmont. Other gold stocks with significant hedge fund interest are Goldcorp GG -1.24% , Kinross Gold KGC -1.72% , Allied Nevada Gold ANV -0.29% , and AngloGold Ashanti AU -4.48% . 

But, is gold truly worth investing in? Or, is it overpriced relative to other commodities? Let's check it out by comparing the historical prices of the gold and commodity indexes. 

We are going to use spot gold prices and two commodity indexes: S&P GSCI (Goldman Sachs Commodity Index) and CCI (Thomson Reuters Equal Weight Continuous Commodity Index). S&P GSCI is a broad-based index mainly weighted in energy (80%), agriculture (10%), industrial metals (6%), and precious metals (2%). CCI is comprised of 17 commodity futures that are continuously rebalanced to maintain equal weighting. Unlike GSCI, which can overweight the energy sector, CCI provides relatively even exposure to all commodity subgroups (energy 18%, metals 24%, soft commodities 29%, and agriculture 29%).

Gold vs. GSCI

We collected daily data points of spot gold prices and GSCI from January 8, 1991 to March 23, 2012 and plotted the values we obtained (see the graph of gold price vs. GSCI ). Gold price and GSCI tracked each other closely before late 2008. After that, the price of gold went up rapidly while GSCI grew at a relatively slow pace. As a result, the gold-price-to-GSCI ratio has gone up to a higher level in recent years. As of March 23, 2012, the gold-price-to-GSCI ratio is 2.37, 25% lower than its peak of 3.18 on February 23, 2009 but still 35% higher than its historical average of 1.75.

Gold vs. CCI

Gold looks a bit overpriced compared with other commodities when using GSCI, an index that has higher weight on energy. Now, let's compare the gold price with an equally weighted commodity index, CCI. Similarly, we collected daily data points of gold prices and CCI from December 29, 1978 to March 23, 2012.Gold prices grew abnormally high in January 1980 to about $850 per ounce due to high inflation, high oil prices, and the termination of the direct convertibility of the dollar to gold. The price of gold has also gone up much faster than CCI since late 2008. Therefore, the gold-price-to-CCI ratio has a peak of 3.02 on December 7, 2011 and it also reached 2.93 earlier on January 21, 1980. As of March 23, 2012, the ratio is 2.89 which is 74% higher than its historical average of 1.66 (see the gold/CCI graph ). 

Overall, the price of gold has been on an uphill trend over the past decade, but it grew much more rapidly than other commodities only in recent years. Gold market is very liquid and it also doesn't cost a lot to store it. Gold supply is also pretty inelastic, which makes it a good long-term play on inflation. These may be the reasons why investors preferred gold over other commodities. Our calculations showed that gold is overpriced relative to other commodities. This doesn't mean that gold prices are going to go down though. Considering that there were no supply side shocks after September 2008 that would explain the 100% increase in gold prices relative to commodities, we think investors would be better off by betting on commodities and shorting gold. 

Source; http://www.marketwatch.com/story/is-gold-overpriced-relative-to-other-commodities-2012-03-29