By FXEmpire.com
Introduction: Silver futures are standardized, exchange-traded contracts in which the contract buyer agrees to take delivery, from the seller, a specific quantity of silver (eg. 30000 grams) at a predetermined price on a future delivery date.
Some Facts about Silver
Silver is a soft, shiny and heavy metallic element with a brilliant white luster. A very ductile and malleable metal, its thermal and electrical conductivity is the highest of all known metals.
Besides being used as a store of value, other main uses of silver include applications in areas such as electronics, photography and as antiseptics.
Consumers and producers of silver can manage silver price risk by purchasing and selling silver futures. Silver producers can employ a short hedge to lock in a selling price for the silver they produce while businesses that require silver can utilize a long hedge to secure a purchase price for the commodity they need.
Silver futures are also traded by speculators who assume the price risk that hedgers try to avoid in return for a chance to profit from favorable silver price movement. Speculators buy silver futures when they believe that silver prices will go up. Conversely, they will sell silver futures when they think that silver prices will fall.
Weekly Analysis and Recommendations:
Silver marched behind gold for most of the week, closing at 28.635.
The metals group performed poorly all week as the global slowdown affected the entire metal base. Also all USD denominated commodities were depressed with the USD reaching the highest level this year. Investors spent the week running to the safety of the dollar making it difficult to price silver, as the price fell it was more attractive to buyers, but with the strength of the USD the conversion left out most foreign buyers.
Major Economic Events for the week of May 14-18 actual v. forecast for Euro, GPB, and the Franc
|
CHF |
PPI (MoM) |
-0.1% |
0.3% |
0.3% |
|
EUR |
Industrial Production (MoM) |
-0.3% |
0.4% |
0.8% |
|
GBP |
Trade Balance |
-8.6B |
-8.4B |
-8.6B |
|
EUR |
GDP (QoQ) |
0.0% |
-0.2% |
-0.3% |
|
EUR |
ZEW Economic Sentiment |
-2.4 |
11.7 |
13.1 |
|
GBP |
Claimant Count Change |
-13.7K |
5.0K |
-5.4K |
|
GBP |
Average Earnings Index +Bonus |
0.6% |
1.0% |
1.1% |
|
EUR |
Core CPI (YoY) |
1.6% |
1.5% |
1.6% |
|
EUR |
CPI (YoY) |
2.6% |
2.6% |
2.6% |
Economic Highlights of the coming week that affect the Euro, GBP, CHF and the USD
|
May 21 |
5:45 |
CHF |
SECO Consumer Climate |
-18 |
-19 |
|
May 22 |
8:30 |
GBP |
CPI y/y |
3.5% |
|
|
8:30 |
GBP |
Public Sector Net Borrowing |
15.9B |
||
|
8:30 |
GBP |
RPI y/y |
3.6% |
||
|
TBD |
GBP |
BOE Inflation Letter |
|||
|
14:00 |
USD |
Existing Home Sales |
4.48M |
||
|
May 23 |
8:00 |
EUR |
Current Account |
-1.3B |
|
|
8:30 |
GBP |
MPC Meeting Minutes |
0-0-9 |
||
|
TBD |
EUR |
Industrial New Orders m/m |
-1.2% |
||
|
10:00 |
GBP |
CBI Industrial Order Expectations |
-8 |
||
|
TBD |
GBP |
Inflation Report Hearings |
|||
|
14:00 |
USD |
New Home Sales |
328K |
||
|
14:30 |
USD |
Crude Oil Inventories |
|||
|
May 24 |
6:00 |
CHF |
Trade Balance |
1.69B |
|
|
7:00 |
EUR |
French Flash Manufacturing PMI |
46.9 |
||
|
7:00 |
EUR |
French Flash Services PMI |
45.2 |
||
|
7:30 |
EUR |
German Flash Manufacturing PMI |
46.2 |
||
|
7:30 |
EUR |
German Flash Services PMI |
52.2 |
||
|
8:00 |
EUR |
German Ifo Business Climate |
109.9 |
||
|
8:00 |
EUR |
Flash Manufacturing PMI |
45.9 |
||
|
8:00 |
EUR |
Flash Services PMI |
46.9 |
||
|
8:30 |
GBP |
Retail Sales m/m |
1.8% |
||
|
8:30 |
GBP |
Revised GDP q/q |
-0.2% |
||
|
8:30 |
GBP |
BBA Mortgage Approvals |
31.9K |
||
|
8:30 |
GBP |
Prelim Business Investment q/q |
-3.3% |
||
|
12:30 |
USD |
Unemployment Claims |
|||
|
12:30 |
USD |
Durable Goods Orders m/m |
-4.0% |
||
|
13:00 |
EUR |
Belgium NBB Business Climate |
-10.7 |
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Originally posted here
