GOLD
Gold moved higher overnight to open at
1264.00/1265.00. It touched a high of 1268.50/1269.50 generating
“safe haven” interest following the ongoing financial crisis in
emerging markets, particularly in Argentina, which dragged global
equities lower. The metal then dropped to a low of 1261.00/1262.00
as investors geared up for the Fed’s policy statement, before
finally closing the session at 1262.00/1263.00. Following the close,
the metal traded within range despite the Fed announcement of a
further $10 billion cut to bring its monthly bond purchases down to
$65 billion.
Gold traded higher today, closing at
1263. Resistance sits at 1278-79, from the 38.2% retracement of the
August to December 2013 downtrend, and from Monday’s high. Support
is at the recent low of 1231. RSI has turned higher, and is testing
resistance at 62 (currently at 60.33).
Gold gained as stock markets
surrendered early gains to fall ahead of a policy statement from the
Federal Reserve.
Fed said it would trim its bond
purchases by another $10 billion as it stuck to a plan to wind down
its extraordinary economic stimulus
SPDR gold trust holding gained by 2.10
tonnes i.e. 0.27% to 792.56 tonnes from 790.46 tonnes.
Technical Levels
|
S 1 |
S 2 |
R 1 |
R 2 |
| GOLD |
1250 |
1239 |
1272 |
1282 |
SILVER
Silver edged higher overnight to open
at 19.70/19.75. After posting a high of 19.95/20.00, it declined
steadily to close at the session low of 19.54/19.59.
Silver is also trading higher at 19.59.
Silver continues to be trapped within a sideways range, with the
range high being 20.64, and the range low being 18.84. There is also
a downtrend on the daily chart which comes in at 20.17.
The gold-silver ratio is trading lower
today at current 64.15. This is the first lower close after six
sessions higher. Resistance is at the 67.56 high. There is strong
support from the daily uptrend which currently comes in at 61.38.
Silver rose as ongoing turbulence in
emerging markets boosted the safe haven appeal of the precious metal.
Prices earlier seen pressure as market
sentiment improved after Turkey’s central bank announced aggressive
rate hikes in an effort to stem the lira’s decline.
The U.S. Federal Reserve announced a
further reduction in its bond-buying stimulus.
Technical Levels
|
S 1 |
S 2 |
R 1 |
R 2 |
| SILVER |
19.35 |
19.14 |
19.86 |
20.17 |
COPPER
On the Comex division of the New York
Mercantile Exchange, copper futures for March delivery hit a session
high of USD3.268 a pound, before trimming gains to trade at USD3.262
during European morning trade, up 0.3%.
The March copper contract fell to
USD3.246 a pound on Tuesday, the lowest since December 9, before
paring losses to settle at USD3.253 a pound, down 0.18%.
Copper futures were likely to find
support at USD3.246 a pound, the low from January 28 and resistance
at USD3.287 a pound, the high from January 27.
Appetite for riskier assets improved
after Turkey’s central bank announced aggressive rate hikes
overnight in an effort to stem the lira’s decline.
Turkey's central bank raised its
overnight lending rate to 12% from 7.75% and its repurchase rate to
10% from 4.5% in its first emergency meeting since 2011.
The move eased concerns over emerging
markets, following a broad based selloff last Friday, triggered by
worries over the impact of reduction in Fed stimulus
and concerns over a possible slowdown
in China.
Copper futures edged mildly higher on
Wednesday, as global markets rebounded after an aggressive rate hike
by the Turkish central bank and ahead of a policy announcement by the
Federal Reserve later in the day.
Technical Levels
|
S 1 |
S 2 |
R 1 |
R 2 |
| COPPER |
3.2286 |
3.2168 |
3.2606 |
3.2808 |
CRUDE
On Wednesday, the New York-traded oil
futures hit a session low of USD97.38 a barrel and a high of USD97.59
a barrel. The March contract settled at USD97.42 a barrel.
Nymex oil futures were likely to find
support at USD95.22 a barrel, Monday's low, and resistance at
USD97.65 a barrel, Tuesday's high.
Meanwhile on Wednesday, the U.S. Energy
Information Administration said in its weekly report that U.S. crude
oil inventories rose by 6.4 million barrels in the week ended Jan.
24, far beyond expectations for an increase of 2.3 million barrels,
which sent prices falling by fanning fears the country remains awash
in supply.
Total U.S. crude oil inventories stood
at 357.6 million barrels as of last week.
The report also showed that total motor
gasoline inventories decreased by 819,000 barrels compared to
forecasts for a gain of 1.1 million barrels.
NYMEX crude oil prices rose during
Asian trading hours on Thursday after Federal Reserve decided to cut
USD10 billion from its USD75 billion monthly bond-buying program and
U.S. supply data disappointed investors.
On the New York Mercantile Exchange,
West Texas Intermediate crude for delivery in March traded at
USD97.62 a barrel during Asian trading, up 0.26%
Technical Levels
|
S 1 |
S 2 |
R 1 |
R 2 |
| CRUDE |
96.53 |
95.71 |
97.96 |
98.57 |
Global Economic Data
| TIME
|
DATA |
PRV |
EXP |
IMPACT |
| 7.00P.M
|
Advance GDP q/q |
4.1% |
3.3% |
STRONG |
| 7.00P.M
|
Unemployment Claims |
326K |
331K
|
STRONG |
| 7.00P.M
|
Advance GDP Price Index q/q |
2.0% |
1.2% |
MEDIUM |
| 8.30P.M
|
Pending Home Sales m/m |
0.2% |
-0.1% |
STRONG |
Advance GDP q/q
| Source |
Bureau of Economic Analysis (latest release) |
| Measures |
Annualized change in the inflation-adjusted value of all goods
and services produced by the economy; |
| Usual Effect |
Actual > Forecast = Good for currency; |
| Frequency |
Released quarterly, about 30 days after the quarter ends; |
| Next Release |
Apr 30, 2014 |
| FF Notes |
While this is q/q data, it's reported in an annualized format
(quarterly change x4). There are 3 versions of GDP released a
month apart – Advance, Preliminary, and Final. The Advance
release is the earliest and thus tends to have the most impact; |
Why Traders
Care |
It's the broadest measure of economic activity and the primary
gauge of the economy's health; |
| Also Called |
GDP First Release, Estimated GDP; |
| Acro Expand |
Gross Domestic Product (GDP); |
Unemployment Claims
| Source |
Department of Labor (latest release) |
| Measures |
The number of individuals who filed for unemployment insurance
for the first time during the past week; |
| Usual Effect |
Actual < Forecast = Good for currency; |
| Frequency |
Released weekly, 5 days after the week ends; |
| Next Release |
Feb 6, 2014 |
| FF Notes |
This is the nation's earliest economic data. The market impact
fluctuates from week to week - there tends to be more focus on the
release when traders need to diagnose recent developments, or when
the reading is at extremes; |
Why Traders
Care |
Although it's generally viewed as a lagging indicator, the
number of unemployed people is an important signal of overall
economic health because consumer spending is highly correlated
with labor-market conditions. Unemployment is also a major
consideration for those steering the country's monetary policy; |
| Also Called |
Jobless Claims, Initial Claims; |
Pending Home Sales m/m
| Source |
National Association of Realtors (latest release) |
| Measures |
Change in the number of homes under contract to be sold but
still awaiting the closing transaction, excluding new
construction; |
| Usual Effect |
Actual > Forecast = Good for currency; |
| Frequency |
Released monthly, about 28 days after the month ends; |
| Next Release |
Feb 28, 2014 |
| FF Notes |
This data is released about a week later than Existing Home
Sales, but it's more forward-looking as a contract is signed
several weeks before the home is counted as sold; |
Why Traders
Care |
It's a leading indicator of economic health because the sale of
a home triggers a wide-reaching ripple effect. For example,
renovations are done by the new owners, a mortgage is sold by the
financing bank, and brokers are paid to execute the transaction; |
| Also Called |
Pending Resales; |
Market Forecast for week ahead:
