By FXEmpire.com
Analysis and Recommendations:
Gold has spent the day looking for direction moving between small gains and small losses.
The health of the Euro zone economy elevated after reports that Spain was close to seeking a full bailout. Spanish central bank remarked that the economy sank deeper into recession in the second quarter. In addition, mounting fears of a recession, bond yields of the country jumped to Euro-era high yesterday. Meanwhile, Moody’ investor service changed their outlook of Germany, Netherlands and Luxembourg to negative from stable adding pressure on Euro sentiments. At the same time, IMF will restart discussion with the Greek authorities on how to bring the economic program back on track. Gold’s correlation with Euro has been high recently fluctuating to the fortunes of Euro. The dollar surged above two year highs yesterday as increased worries on Europe shifted investors focus to the US dollar.
Physical demand for gold from Asia remains lackluster as sideline price actions restricted buyers at current levels.
Just a heads up since gold is volatile and will react to most economic indicators we will begin to post the daily calendar with events that could affect the price of gold. The gold price is sensitive to a number of scheduled U.S. and Euro area macroeconomic announcements–including retail sales, non-farm payrolls, and inflation. Gold’s high sensitivity to real interest rates and its unique role as a safe-haven and store of value typically leads to a counter-cyclical reaction to surprise news, in contrast to their commodities. It also shows a particularly high sensitivity to negative surprises that might lead financial investors to become more risk averse.
These results have a number of implications. To reduce the uncertainty of the return on gold transactions, traders may wish to time their orders flow so as to avoid the release of information that has been shown to affect prices. For longer-term market participants, these results provide confirmation of the pro-cyclical bias of many commodities and gold’s role as a safe-haven during periods of economic uncertainty.
FxEmpire provides in-depth analysis for each currency and commodity we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more up to the data analysis and information in our weekly reports.
Economic Data July 24, 2012 actual v. forecast
|
Date |
Currency |
Event |
Actual |
Forecast |
Previous |
|
Jul. 24 |
CNY |
Chinese HSBC Manufacturing PMI |
49.50 |
48.20 |
|
|
AUD |
RBA Governor Stevens Speaks |
||||
|
EUR |
French Manufacturing PMI |
43.6 |
45.5 |
45.2 |
|
|
HUF |
Hungarian Retail Sales (YoY) |
-2.50% |
-2.00% |
-2.80% |
|
|
EUR |
German Manufacturing PMI |
43.3 |
45.3 |
45.0 |
|
|
EUR |
Manufacturing PMI |
44.1 |
45.3 |
45.1 |
|
|
GBP |
BBA Mortgage Approvals |
26.3K |
31.4K |
29.6K |
|
|
Core Retail Sales (MoM) |
0.5% |
0.2% |
-0.4% |
||
|
CAD |
Retail Sales (MoM) |
0.3% |
0.5% |
-0.6% |
Upcoming Economic Events that affect the CHF, EUR, GBP and USD
|
Date |
Time |
Currency |
Event |
Previous |
|
Jul 25 |
8:00 |
EUR |
105.3 |
|
|
8:30 |
GBP |
-0.3% |
||
|
10:00 |
GBP |
-11 |
||
|
13:00 |
EUR |
-13.2 |
||
|
14:00 |
USD |
369K |
||
|
14:30 |
USD |
|||
|
Jul 26 |
6:00 |
EUR |
5.8 |
|
|
8:00 |
EUR |
2.9% |
||
|
12:30 |
USD |
0.7% |
||
|
12:30 |
USD |
|||
|
14:00 |
USD |
5.9% |
||
|
Jul 27 |
27th-31st |
GBP |
-0.6% |
|
|
All Day |
EUR |
-0.1% |
||
|
7:00 |
CHF |
1.16 |
||
|
12:30 |
USD |
1.9% |
||
|
13:55 |
USD |
72.0 |
Government Bond Auctions
Date Time Country
Jul 25 09:30 Germany
Jul 25 15:30 Italy
Jul 25 17:00 US
Jul 26 00:30 Japan
Jul 26 09:10 Italy
Jul 27 09:10 Italy
Jul 27 17:00 US
Click here a current Gold Chart.
Originally posted here
