By FXEmpire.com
Analysis and Recommendations:
Gold fell in today’s session following the trend that it has been on for the entire month. Gold was slowly falling from the 1660-70 range towards the 1650-40 range where it met with some congestion and was bounced up and down on news and fundamentals, but continued to decline. After the poor NFP report in the US earlier this month, gold began to fall, as market moved to risk aversion mode. The USD and the Yen have climbed significantly. The euro continues to show weakness and most equities and assets that are European associated have taken a hit as investors are worried about the significance of a Greek exit and possible default and the control and leadership of the EU.
Gold is expected to remain depressed until the EU problems are sorted.
Market sentiment remains negative towards commodities.
The strengthening dollar pushed down spot gold to $1536 an ounce, its weakest levels since last December. Reports of Greece’s failure to set up a new government and its decision to hold new elections reignited Euro zone worries and dragged down the Euro to a four month low. Gloomy global equities too pressured gold investors to sell bullion to cover their losses in equity. Recently, gold is seen moving together with other riskier assets as investors veered towards the dollar as the Euro hit multi-low levels. Adding to this weak sentiment, CFTC data showed fund managers and speculators have trimmed their bullish bets in gold futures and options by 20 percent to the lowest level since December 2008. Looking ahead, investors will closely watch the outcome of the FOMC meeting, the minutes of which is scheduled to be released later, to obtain cues for further directional moves.
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 May 16, 2012 actual v. forecast
|
JPY |
Tertiary Industry Activity Index |
-0.6% |
-0.3% |
0.0% |
|
AUD |
Westpac Consumer Sentiment |
0.80% |
-1.60% |
|
|
AUD |
Wage Price Index (QoQ) |
0.9% |
0.8% |
1.0% |
|
GBP |
Average Earnings Index +Bonus |
0.6% |
1.0% |
1.1% |
|
GBP |
Claimant Count Change |
-13.7K |
5.0K |
-5.4K |
|
EUR |
CPI (YoY) |
2.6% |
2.6% |
2.6% |
|
EUR |
Core CPI (YoY) |
1.6% |
1.5% |
1.6% |
|
USD |
Building Permits |
0.715M |
0.730M |
0.769M |
|
USD |
Housing Starts |
0.717M |
0.680M |
0.699M |
|
Manufacturing Sales (MoM) |
1.90% |
1.00% |
-0.20% |
|
|
USD |
Industrial Production |
1.1% |
0.6% |
-0.6% |
Upcoming Economic Events that affect the CHF, EUR, GBP and USD
|
May 17 |
13:30 |
USD |
365K |
367K |
|
|
13:30 |
USD |
3235K |
3229K |
||
|
15:00 |
USD |
10.0 |
8.5 |
Click here for further Gold Forecast.
Originally posted here
