Gold Fundamental Forecast – May 3, 2016

Gold continued to rocket up soaring through the $1300 resistance level to trade at 1303.70 as the US dollar continued to fall. Lackluster Chinese manufacturing data seems to have really upset the markets today. Although the weak dollar played a pivotal role in pushing gold prices higher, there was strong underlying investor confidence, as demand for commodities remained high. With a lackluster performance by equities and expectations of expansionary global monetary policies, a range of commodities has drawn in speculative funds. In this context, prices have stayed strong despite an overall deterioration in risk conditions.

Gold prices initially pushed higher in Friday’s Asian session with a peak in the $1.280 area with the very limited nature of corrective pullbacks again a key market feature. Asian equity markets were generally weaker and the US dollar remained under pressure after its plunge against the yen on Thursday.

The gold-silver ratio reached a more than six-year high of 83.5 in March, a sign that the grey metal was oversold. According to commodity analysts, that partly explains silver’s outsized gains relative to gold over the past four weeks.

Unlike gold, however, silver has benefited from industrial demand as well as risk-off sentiment. Silver is seen as an important industrial metal used for electrical and electronics products, jewelry and silverware and coins and medals. As demand for these items increases, so too does the price of silver.

FxEmpire provides in-depth analysis for each asset 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 covers the current week and are published by Sunday before the new week begins. Daily we share any new events, forecasts or analysis that affect the current day. To achieve a full accurate understanding it is important that you study all of our data and analysis as a whole.

Today’s economic releases:

 

Upcoming Economic Events that you should be monitoring:

Tuesday, May 3, 2016

Government Bond Auctions

Date Time       Country           Auction

Mar 02 13:00 Norway Details of bond auction on Mar 04

May 04 11:05 Norway Holds bond auction

May 04 11:30 Germany Eur 4bn Apr 2021 Bobl

May 04 11:50 France Holds bond auction

May 04 17:20 Sweden Details of bond auction on May 11

May 05 10:30 Spain Holds bond auction

May 05 11:00 Austria Holds bond auction