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Gold and Oil Markets Report – 31 Dec 2012

The US budget talks remain gloomy and uncertain as no new progress has been released. The US debt ceiling has reached USD16.3 trillion as of 31 December 2012 and fiscal cliff will erupt if The US Congress does not reach an agreement to resolve the matter. Investors are observing the market sentiment amid light volume and holiday seasons. Dollar index showed some bullish signs before weekend in-lieu of worries in talk budget.

Crude Oil

WTI Crude prices declined on Friday from 91.46 highs due to fear of US budget failure and concurrently suppressed by EMA200 resistance. This week, we reckon the market will trade in weaker sentiment with range expected to move from 88.50 – 91.50 levels. The technical chart shows better approach by picking short trades from topside regions but need abandonment if the trend reverses above 91.50 resistances.

Gold

Gold prices consolidated in 1647.00 – 1667.00 ranges last week in uncertainty. The market has not shown any sign of new direction but waiting to break either way in coming week. Same as WTI crude, we expect the market to be softer this week while the prices may wind down to 1640.00 regions again. However, stay abreast of market news from US Congress on budget outcome. Abandon your short-view if the bulls march above 1670.00 resistances.

Silver

Silver prices consolidated in small range last week with resistance laid at 30.500 levels. We reckon this resistance area will be pretty strong and all short trades must be abandoned once the bulls violate above 30.500 levels. On the other hand, observe for a probable downfall if the US budget fails on coming early week. On breaking beneath 29.600 supports, the declining trend might drive down lower to 28.000 targets.

Crude Palm Oil

Crude Palm Oil Futures (FCPO) trading on Bursa Derivatives closed at 5-week high with the March delivery contract settled at 2494. Literally, market has been quite in light volume amid holiday seasons while short-coverings were seen ahead of year-end. This week, we reckon the market will sit tight at 2420 supports with possibility of ascension to 2600 areas. The market may celebrate new-year opening spree as well as weakening ringgit against greenback.

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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