Gold Weekly Fundamental Analysis July 2-6, 2012, Forecast

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Introduction: Gold prices always rise when there is uncertainty in the global economy. In times of uncertainty, investors tend to run towards gold. Suppose, rumors are flying high about some event in the world and this is increasing the uncertainty in the financial markets.

  • Gold reacts to uncertainty in the markets
  • Gold reacts to the Federal Reserve and monetary policy
  • A drop in major currencies can indicate a run into gold.
  • Remember investors tend to take profit from gold so watch for trading opportunities when investors are taking profits, not moving out of the markets.

 

Weekly Analysis and Recommendations:

Gold  soared on Friday, after a pre dawn press conference from the EU Summit announced an immediate and cohesive plan to support failing economies and reduce contagion and risk and at the same to kick start the EU economies. Overnight investor confidence rose dramatically. With all assets gaining strongly, gold opened higher at 1585. After a small dip quickly after to an intraday low of 1583.25, the metal continued its rise alongside strong gains in equities, eventually reaching an intraday high of 1606.75/1607.75 late in the session. Gold closed the week shortly after at 1602.50/1603.50

Date

Last

Open

High

Low

Change %

Jun 29, 2012

1597.85

1553.35

1607.45

1551.35

2.86%

Jun 28, 2012

1553.45

1575.15

1579.55

1548.45

-1.37%

Jun 27, 2012

1575.05

1572.45

1582.85

1563.25

0.17%

Jun 26, 2012

1572.35

1585.75

1587.55

1568.55

-0.83%

Jun 25, 2012

1585.55

1570.45

1588.95

1566.95

0.97%

All week gold had trading in a tight range around the 1560 price as it continued on a down trend, after Thursday’s dramatic fall, it looked like gold would end the month and the quarter down, when Friday saw gold make a drastic turn around.

The new plan for the EU is an supervisory bank to oversee and do what is necessary to make sure that markets are protected and to foster growth. The new bank will have the capability to use funds from the emergency EU fund mechanism and the power to do what is necessary.

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 recent analysis and information in our weekly reports and we provide daily updates and outlooks.

Major Economic Events for the week of June 25 – 29 actual v. forecast for the US Dollar

Date

Currency

 Event

Actual

Forecast

Previous

Jun 25

USD

New Home Sales

369K

347K

343K

Jun 26

USD

S&P/CS Composite-20 HPI y/y

-1.9%

-2.4%

-2.6%

USD

CB Consumer Confidence

62.0

63.8

64.4

Jun 27

USD

Core Durable Goods Orders m/m

0.4%

0.9%

-0.6%

USD

Durable Goods Orders m/m

1.1%

0.5%

-0.2%

USD

Pending Home Sales m/m

5.9%

1.2%

-5.5%

USD

Crude Oil Inventories

-0.1M

-0.5M

2.9M

Jun 28

USD

Unemployment Claims

386K

385K

392K

USD

Final GDP q/q

1.9%

1.9%

1.9%

Jun 29

USD

Core PCE Price Index m/m

0.1%

0.2%

0.1%

USD

Personal Spending m/m

0.0%

0.1%

0.1%

USD

Chicago PMI

52.9

52.8

52.7

USD

Revised UoM Consumer Sentiment

73.2

74.2

74.1

Historical

Highest: 1921.05 on Sep 06, 2011

Average: 1418.48 over this period

Lowest: 1026.95 on Oct 28, 2009

Economic Highlights of the coming week that affect the Euro, GBP, CHF and the USD

Date

Time

Currency

 Event

Forecast

Previous

Jul 2

3:15am

CHF

Retail Sales y/y

0.9%

0.1%

3:30am

CHF

SVME PMI

44.6

45.4

3:45am

EUR

Italian Manufacturing PMI

44.6

44.8

4:30am

GBP

Manufacturing PMI

46.7

45.9

5:00am

EUR

Unemployment Rate

11.1%

11.0%

10:00am

USD

ISM Manufacturing PMI

52.1

53.5

Jul 3

3rd-6th

GBP

Halifax HPI m/m

-0.3%

0.5%

4:30am

GBP

Construction PMI

53.1

54.4

4:30am

GBP

Net Lending to Individuals m/m

1.1B

1.4B

10:00am

USD

Factory Orders m/m

0.1%

-0.6%

Jul 4

 

 

 

 

Jul 5

4:00am

EUR

Final Services PMI

46.8

46.8

4:30am

GBP

Services PMI

53.0

53.3

5:00am

EUR

Retail Sales m/m

0.2%

-1.0%

6:00am

EUR

German Factory Orders m/m

0.2%

-1.9%

7:00am

GBP

Official Bank Rate

0.50%

0.50%

7:45am

EUR

Minimum Bid Rate

0.75%

1.00%

8:15am

USD

ADP Non-Farm Employment Change

101K

133K

8:30am

USD

Unemployment Claims

385K

386K

10:00am

USD

ISM Non-Manufacturing PMI

53.1

53.7

11:00am

USD

Crude Oil Inventories

 

-0.1M

Jul 6

3:00am

CHF

Foreign Currency Reserves

 

303.8B

3:15am

CHF

CPI m/m

-0.3%

0.0%

4:30am

GBP

PPI Input m/m

-2.1%

-2.5%

6:00am

EUR

German Industrial Production m/m

0.3%

-2.2%

8:30am

USD

Non-Farm Employment Change

92K

69K

8:30am

USD

Unemployment Rate

8.2%

8.2%

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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

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