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Gold and Oil Markets Report – 18 Feb 2013

Gold prices declined on Friday as USDX value recovered from falling trend. Investors are losing confidence as the US Congress has not bothered to begin the budgeting cuts negotiation as debt ceiling will be reach around month end. WTI Crude prices fell after US industrial production unexpectedly shrank 0.1 percent in January and euro-area exports slid the most in five months, raising concern that fuel demand may weaken.

Crude Oil

WTI Crude prices have been trading largely from 95.00 – 98.00 ranges while it settled at 96.11 for the weekend. This week, we foresee the support could be challenged if profit-taking emerges. The market will be prone bias to selling pressures especially if USDX surges higher. Breaking below 95.00 supports may drive the trend lower to 93.00 areas once demands contract.

Gold

Gold prices melted down on Friday after US factory output shrank in January. With selling pressure building up on the market, we expect the resistance to be suppressing at 1620.00 areas. On the other hand, continual downfall may drive the prices down to S1 – 1590.00 and S2 -1550.00 in coming weeks. Observe the fundamental news that will affect the market weakness from US budget negotiation.

Silver

Silver prices plunged following the yellow metal while Gold /Silver ratio soared to 54.00 areas from 53.00 bases. The market is now resisted at 30.50 levels and downtrend may continue this week. Technically, we expect the bears to face some buying interest at 29.30 areas while market may begin to see some short-coverings. This week, we foresee range trading from 29.00 – 30.50 levels with controlled risk.

Crude Palm Oil

Crude Palm Oil Futures (FCPO) on Bursa Malaysia Derivatives closed lower on Friday due to short week trading. The market sentiment was weak due to high inventory levels and the new active month in May delivery closed at 2486. This week, we reckon support at 2440 while the trend may recover to 2600 regions. Breaking below 2440 could test lower grounds at 2350 areas.

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’ 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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