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Gold and Oil Markets Report – 16 Jan 2012

Crude prices declined last week due to the announcement of oil embargo delay for 6 months by European Union. Gold has been bullish for 2 months and went into further buying last week from the news of bullish sentiment in Mainland China. According to a report dated 11 January, Mainland China imported almost 102.8 metric tons of Gold in November, valued at about USD5.4 billion.

Crude Oil

WTI Crude prices fell beneath 100.00 benchmarks and settled at 99.05 for the weekend. This week, we expect the market to remain weak initially and land at 96.00 regions before some buying interest may emerge. We believe the trend will move into technical consolidation soon after the target completes at 96.00 territories. However, additional tension from Iran’s threat may reverse the market above 100.00 levels which should be risk-controlled for short traders.

Gold

Gold prices have been bullish for past 2 weeks and we expect some consolidation to occur soon. From the market outlook, we expect the resistance to be tough at 1655.00 – 1662.00 while a more likely downside range is aimed at 1605.00 regions. However, we predict the reversal downtrend will only come after middle of this week so selling too early may not be ideal!

Silver

Silver prices have been rising from recent strong bottom 26.14 and may tend to correct this week from the top 30.67. This week, we reckon the market may re-test the resistance R1 – 30.30 before sliding. Out next resilient support is identified at 28.50 levels while the market is gradually moving into technical digestion. Abandon your short-view if the market violates above 30.70 levels!

Crude Palm Oil

Crude Palm Oil Futures (FCPO) on Bursa Malaysia Derivatives closed at RM3151 for March contract. The market was unable to penetrate the resistance 3244 as mentioned in previous report. Basically, the downtrend occurred was due to the lead from Crude prices and CBOT Soy Futures. This week, we expect the CPO prices will remain bearish and possibly aim at 3050 regions. Resistance is identified at 3000 levels now.

Dar Wong

This post is contributed by OPF Guest Blogger, DAR Wong.

Wong is founder and principal consultant of PWForex.com and holds a professional qualification in NASD series 3 and 5 approved by National Futures Association (USA). He was previously attached with Bankers Trust Futures Inc, Barclays ZW Futures and Smith Barney Shearson (Citigroup) Inc.

He is also an active trader and author of 8 Ways to Invest In China’s Emerging Markets. Wong is also columnist for The Star, The Borneo Post in East Malaysia, The Busy Weekly, The Trader’s Journal, The Forex Journal, The Pulses, The Analysts and Capital Asia magazine.

He is a regular speaker on trading topics as well as Master Speaker for the annual Asia Traders and Investors Convention (ATIC).

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DISCLAIMER: This post is written for general information only. The author, publisher and/or any third party involved in the distribution of this work assume no legal responsibilities and shall have no liability whatsoever for any direct or consequential losses, costs or expenses arising from the use of the information contained herein.

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