Gold and Oil Markets Report – 9 July 2012

Commodities turn softer after euro debt woes signal less demands from manufacturing output. Last week, crude prices were supported moderately following the implementation of embargo against Iran in July. However, oil prices were beaten towards weekend while reacting to dropping U.S. payrolls. Gold slid after mid week entailing the euro rate cut for cushioning threats of recession.   

Crude Oil

WTI crude prices came off from Thursday's peak 88.98 and closed at 84.40 for the weekend. From technical outlook, we expect to see weaker trend in coming week as the bearish sentiment might be carried over from Friday's pessimism in U.S. payrolls. The market will probably trade from 81.10 – 87.00 regions but prone to southern trend from topside selling pressures in coming early week.

Gold

Gold prices plunged in contracting demands after Thursday and closed at 1583.00 regions on Friday. The diving beneath 1600.00 benchmarks signifies bearish sentiment which might attempt lower grounds...

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Euro leaders reach key deal to bailout Spain

A guest post written by DAR Wong

Currency Market Observations – 2 July 2012

Fundamental Outlook

The US economy remains flamboyant with uneven recovery with improvement in housing demands amid struggling job markets. Japan’s yen assets rise to record holding among offshore banks as safe haven from euro debt crisis. European leaders reach key decision to bailout Spain and other troubled banks that trigger the highest single day surge in 2012.

The US new home sales climbed to a 369,000 annual rate in May and rose 7.6 percent from the prior month, due to falling mortgage rates. The pending home sales climbed 5.9 percent after slumping 5.5 percent in April. Another report on home values in 20 cities by S&P/Case-Shiller showed the index dropped 1.9 percent from a year earlier at the month ended April, the smallest decrease since November 2010.

The Conference Board’s index that measures consumer...

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Gold and Oil Markets Report – 2 July 2012

Commodities turned up sharply on Friday after European leaders reached relief agreement to relax loan conditions to Spain and possible rescue funds to Italy. WTI Crude prices rebound from bottom while the investors’ sentiment also begins to short-cover ahead of Europe’s embargo on Iran from 1 July. Gold prices jumped sharply together with European currencies after reacted to positive fundamentals in bailout plans.

Crude Oil

WTI crude prices drove up on Friday to above 82.00 benchmarks from 77.00 regions. Since the market has failed to test the 75.00 supports, it may begin to consolidate in coming week with short-covering appearing among buyers. While we foresee the immediate support may arise at 79.50 levels, the bulls may charge higher to 88.00 areas in coming week if the optimism of euro bailout extends higher.

Gold

Gold prices reversed up on Friday from 1550.00 areas to 1600.00 regions at end of day. Technically, the trend still...

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Gold and Oil Markets Report – 25 June 2012

Last week, the outcome of US Federal Open Market Committee (FOMC) meeting drove the commodity markets downward after policymakers announced the swap of short-term credit to long-term debt with USD267 billion. Further contraction in Eurozone and China put the bears into global markets in tandem with worsening debt crisis. The Moody's agency downgraded the credit ratings of 15 financial institutions after Thursday market closed which sank Asia equities on Friday.

Crude Oil

WTI crude prices reached 77.56 low last week on general market weakness of demands from major economies. Market broke below 80.00 benchmarks in past 12-months record citing demands contracting from China's manufacturing. This week, we expect the market to be resisted at 82.50 resistances while the bears may travel southward to test 75.00 regions. In our opinion, bargain hunting will emerge at 75.00 levels due to past major supports over last 2 years. In summary, picking short entry in early...

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The US FOMC Meeting Lowers Growth Outlook

A guest post written by DAR Wong

Currency Market Observations – 25 June 2012

Fundamental Outlook

The Federal Open Market Committee meeting extends its credit swap of USD267 billion in short-term securities to longer-term debt through the end of 2012. Federal Reserve (FED) officials downgrade the forecast to 1.9 percent range from earlier outlook of above 2.4 percent in April. Moody's agency cut the rating's of 15 financial institutions on last Thursday, including giants like Bank of America, Goldman Sachs and JPMorgan etc for their risk exposure to financial stability.

The US existing home sales dropped 1.5 percent to 4.55 million annual rate in May. Another separate report on jobless claims decreased by 2,000 to 387,000 in the week ended June 16, showing struggling job markets. The index of US leading economic indicators for May increased 0.3 percent after a 0.1 percent drop in April, propelled by...

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UK Plunges In Economic Deterioration

A guest post written by DAR Wong

Currency Market Observations – 18 June 2012

Fundamental Outlook

Both US and UK economy deteriorate by economic expansion cooling down in industrial production, consumer demands and exports. Yen rises unfavorably as safe haven that has deterred Japan's recovery amid the Euro debt crisis. Investors remain cautious while waiting for the outcome of Greek election that will decide the fate of euro.

The US retail sales for May shed 0.2 percent from April and reversed down this previous gain. Jobless claims unexpectedly climbed by 6,000 to 386,000 in the week ended June 9 showing contracting job markets in weakness. Another separate report on consumer prices slid 0.3 percent in May, undermined by recent falling oil prices while the core prices, excluding food and energies, rose 0.2 percent from April.

The US industrial production decreased 0.1 percent in May after a revised 1...

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Gold and Oil Markets Report – 18 June 2012

Last week, crude oil prices were generally weak due to melting economy in US and European regions. However, the speculation on stimulus packages to be injected in coming week after Greek election might put the bulls back into the market for increasing oil demands. Gold prices stay above 1600.00 benchmarks but has been moving small range. Last Friday, OPEC meeting decided to keep output quota unchanged in preparation of European’s embargo on Iran starting from July 1.

Crude Oil

WTI Crude prices have immediate support lying at 81.00 levels now while selling pressures come down from 85.00 resistances. This week, it is crucial to monitor if there is any stimulus to be injected in European regions for lifting the trend higher. Breaking the R1 – 85.00 will still face challenge in higher resistance at R2 – 87.50 levels. However, beware of the trend turning weaker due to panic selling triggered by...

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Gold and Oil Markets Report – 11 June 2012

Crude oil prices dipped in mid week after US was downgraded by S&P rating agency to AA+ grades. Manufacturing demands from global major economies has been contracting and China began to cut interest rates by 0.25 percentage point on Friday. Gold prices plunged from USD1640.00/oz – USD1555.00/oz levels and poised to close at 1591.00 regions for the weekend.

Crude Oil

WTI Crude prices were soft throughout the week but pared losses on Friday on hope of Spain being bailout. The market closed at 84.30 on Friday. We remain our view of continual technical correction which will move sideways from recent low regions at 81.00 – 88.00 resistances in coming week. Immediate support lies at 82.00 areas which will probably lift the trend higher this week due to technical recovery. Abandon your long-view if any further negative fundamental news drives into market meltdown again!

Gold

Gold prices has formed a flag-pattern in day-chart while...

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S&P Downgrades US Rating From AAA Grade

A guest post written by DAR Wong

Currency Market Observations – 11 June 2012

Fundamental Outlook

The S&P rating agency downgrades US financial ranking from AAA to AA+ due to its resilient national debt. Both European Central Bank (ECB) and Bank of England (BOE) held its benchmark rates unchanged in last week's meeting. China reduces 0.25 percentage points off its lending and deposit rates for the first time since 2008.

The US factory orders dropped 0.6 percent in April against positive forecast, after a revised 2.1 percent decrease in March. The Institute for Supply Management's index services unexpectedly rose to 53.7 in May from April's 53.5.

The initial jobless claims in US Labor Department fell by 12,000 to 377,000 in the week ended June 2 from a revised 389,000. Jobs and consumer demands are still on contraction with enlarging national debts. On August 5, S&P rating agency lowered...

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The US Payrolls Shock Market In Huge Decline

A guest post written by DAR Wong

Currency Market Observations – 04 June 2012

Fundamental Outlook

The US non-farm payrolls rise disappointingly at only half of the median forecast. DJIA stocks decline while dollar recedes against on European currencies. Japan yen begins to swell again as safe haven after investors lose confidence in euro debt woes. The Eurozone is in chaos with disruption of further bailout for Greece until June while Spanish 10-year bond yields have reached almost 7 percent record high.

The US Conference Board's index decreased to 64.9 in May from a revised 68.7 in April. Another report from S&P/Case-Shiller index of property values showed home prices in 20 cities dropped 2.6 percent in the 12 months ended March. The US pending home resale dropped 5.5 percent in April following a revised 3.8 percent gain the prior month, indicating uneven road to recovery.

The GDP...

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