Gold and Oil Markets Report – 25 March 2013
Last week, the U.S. Federal Reserve Chairman Ben S. Bernanke said that policymakers will inject new financial stimuli only if more added jobs could be seen. He reiterated the continual effort of central bank to put up monthly USD85 Billion into Treasury and Housing supports without stating the future termination. Eurozone has been largely focused in Cyprus for its debt problem which has not been resolved. President Nicos Anastasiades failed in negotiating fund rescue from European Central Bank and Moscow government while closing the local banks till Monday. Uncertainty will loom in Euro currency this week.
WTI Crude prices are still reacting inversely to USDX trend healthily. The market is now trading from 92.40 supports and suppresses at 94.50 resistances. The failing resolution of Cyprus debt may trigger flight of funds into U.S. dollar which will punt down crude prices in coming week, or vice versa. Technically, there is no clue from chart reading unless we see the direction moves beyond either of the extremes as stated above in near future.
Gold prices were slightly strong from steady recovery in U.S. housing and manufacturing data while rising from 1590.00 levels to 1616.00 tops. This week, it is difficult to gauge the direction of yellow metal from fundamental factors as it seems to decouple from inverse correlation to USDX. Technically, we reckon the possibility to sideway fluctuation around 1600.00 benchmarks again but breaking below 1590.00 supports may initiate new bearish trend to re-visit 1560.0 targets. Piercing above 1616.00 could climb higher to 1640.00 levels!
Silver prices showed bearish sign on Friday closing after the uptrend was halted at 29.40 levels. This week, we reckon the market may fall lower to test 28.00 targets but beyond this depth will depend on fundamental weakness in metal market. Immediate resistance lies at 29.20 and settling above here may endanger shorting opportunity, hence traders are advised to control risk if picking short entries from pull-up retracement.
Crude Palm Oil
Crude Palm Oil Futures (FCPO) on Bursa Malaysia Derivatives made technical recovery last week after the general trends of agricultural commodities bounced from recent bottoms. FCPO market short-covered after mid last week and June contract closed at 2494 on Friday. This week, we foresee continual strength in market and crossing above 2500 might climb higher to 2550 towards weekend. Downside support sits on 2440 levels.
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’ 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).
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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