Gold Fundamental Analysis May 24, 2012, Forecast

Get Forex buy/sell signals directly to your email and by SMS.
To learn more click here

Analysis and Recommendations:

Gold plummeted today, dropping by 37.25 to change hands at 1539.35.

Gold retreated for a second day as concern that Greece may leave the euro region strengthened the dollar, trimming demand for alternative investments. Silver, platinum and palladium declined.  Spot gold fell as much as 0.9 percent after declining yesterday by the most in two weeks. Holdings in exchange-traded products shrank for the first time in four days to 2,383.967 metric tons.

European leaders are meeting today to discuss the region’s debt crisis that has wiped more than $4 trillion from equity markets worldwide this month. The dollar climbed to a 20- month high against a six-currency basket including the euro. June-delivery bullion fell for a third day on the Comex in New York, dropping as much as 1.4 percent to $1,540 an ounce and last trading at $1,539.35. Asian stocks and commodities including oil and copper retreated before European Union leaders gather in Brussels to discuss how to revive growth. Cash silver lost as much as 1.7 percent to $27.7175 an ounce and was last at $27.7825, extending the 1.9 percent drop in past two days

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 for May 23, 2012 actual v. forecast

Date

 

Currency

   

 

Event

Actual

 

Forecast

 

Previous

 

 

May 23

 

JPY

 

 

 

Trade Balance 

-0.48T

 

-0.60T 

 

-0.62T 

 

 

 

 

JPY

 

 

 

Interest Rate Decision 

0.10%

 

0.10% 

 

0.10% 

 

 

 

 

GBP

 

 

 

Retail Sales (MoM) 

-2.3%

 

-0.8% 

 

2.0% 

   

 

 

GBP

 

 

 

Retail Sales (YoY) 

-1.1%

 

1.0% 

 

3.1% 

   

 

 

EUR

 

 

 

Industrial New Orders (MoM) 

1.8%

 

-0.1% 

 

-1.2% 

 

 

 

 

GBP

 

 

 

CBI Industrial Trends Orders 

-17

 

-10 

 

-8 

 

 

 

 

CAD

 

 

 

Core Retail Sales (MoM) 

0.1%

 

1.0% 

 

0.4% 

   

 

 

CAD

 

 

 

Leading Indicators (MoM) 

0.3%

 

0.3% 

 

0.3% 

   

 

 

CAD

 

 

 

Retail Sales (MoM) 

0.4%

 

0.4% 

 

-0.2% 

 

 

 

 

USD

 

 

 

New Home Sales 

343K

 

335K 

 

332K 

   

 

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.

Upcoming Economic Events that affect the CHF, EUR, GBP and USD

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

May 25

6:00

EUR

 

GfK German Consumer Climate

   

5.6

7:15

CHF

 

Employment Level

   

4.04M

TBD

ALL

 

G8 Meetings

     

13:55

USD

 

Revised UoM Consumer Sentiment

     
Want to read more articles like this one?
Enter your e-mail address and read FX Empire content directly from your inbox.
 
We value your privacy. Your e-mail address will not be shared.
About: FX Empire Analyst - Barry Norman

Barry produces a private Daily Market Review newsletter that is distributed around the globe to over 25,000 subscribers and recently published a book on Options Trading that is available from amazon.com

  View all of FX Empire Analyst - Barry Norman's Articles    
Share Your Thoughts: Post a Comment


Your email address will not be published.


include_once( __DIR__ . "/request_context.php");