By FXEmpire.com
Analysis and Recommendations:
Gold continued to fall in the US session today, trading at 1560.95. During the EU session gold had actually posted a small gain. Gold futures prices are hovering near a four months low as European political hazard looms to be a risk aversion act to the investors. Although at the weekend Chinese government had loosen the monetary policy to shield the hard landing, the European woes would have offset the positive sentiment and probably that has led the Asian equities to trade lower. The Euro, quite naturally slipped ahead of the Greek meeting led by the largest anti-bailout party which raised the risk of Euro area-exit for Greece. On this back ground,
Gold is likely to be under strain for the day. The Euro is expected to extend its loss as the European glitch worsens further since the disgruntled voters directed the nation to a probable re-election. The debate between growth and austerity is therefore to be the talk of the town when the newly settled French president and German chancellor start discussion tomorrow aiming for a spending cut. Nevertheless, controversies are certain which will be leaving the Euro to limp.
Gold is therefore may stumble owing for the reasons stated above. There are no such economic releases scheduled from the US, but the German price index (April) may increase as the trade relations with other countries would have deteriorated and thereby pressure mounted on domestic demand. The Euro zone industrial production is likely to grow at slower pace. These all may not influence the Euro to a greater extent but some kind of pull back can be seen if the PPI fell. Market will also be eyeing this week’s Fed minutes at which no easing is expected any time soon. Said so, we expect Gold to remain weak for the day and suggest staying short for the metal.
The Gold/Silver Ratio as expected has improved to 54.82 from 54.68 on Friday. Today as well we expect the ratio to move up as silver is more prone to a downside at a faster pace than gold. We therefore recommend buying gold and selling silver as a strategy to reap the benefit of an ascending ratio.
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, which cover the current week and are published by Sunday before the new week begins.
Economic Data May 14, 2012 actual v. forecast
|
May 14 |
02:30 |
AUD |
Home Loans (MoM) |
0.3% |
-2.0% |
-2.5% |
|
08:15 |
CHF |
PPI (MoM) |
-0.1% |
0.3% |
0.3% |
|
|
10:00 |
EUR |
Industrial Production (MoM) |
-0.3% |
0.4% |
0.8% |
|
|
10:10 |
EUR |
Italian 10-Year BTP Auction |
5.66% |
5.84% |
Upcoming Economic Events that affect the CHF, EUR, GBP and USD
|
May 15 |
06:30 |
EUR |
French CPI (MoM) |
0.8% |
|
07:45 |
EUR |
French Non-Farm Payrolls (QoQ) |
-0.1% |
|
|
09:30 |
GBP |
Trade Balance |
-8.8B |
|
|
May 16 |
09:30 |
GBP |
Average Earnings Index +Bonus |
1.1% |
|
09:30 |
GBP |
Claimant Count Change |
3.6K |
|
|
10:00 |
EUR |
CPI (YoY) |
2.6% |
2.6% |
|
10:00 |
EUR |
Core CPI (YoY) |
1.6% |
|
|
11:00 |
EUR |
Portuguese Unemployment Rate |
14.00% |
Government Bond Auctions (this week)
Date Time Country
May 15 09:30 Belgium
May 15 09:30 UK
May 16 08:50 France
May 16 09:10 Sweden
May 16 09:30 Germany
May 16 09:50 France
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Originally posted here
