Gold Weekly Fundamental Analysis September 10-14, 2012, Forecast

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

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 closed the week at 1735.56 hitting a multi month high after the US jobs data just about secured the FOMC stimulus, as promised by Mr. Bernanke at his Jackson Hole speech.

It was a decidedly negative report due to the meager number of jobs created in August and the downward revision for the two prior months the data is clearly disappointing enough to allow for a third round of quantitative easing, which lends support to commodity prices.

China’s approval of a multibillion-dollar infrastructure program helped push key industrial feedstock copper, another dollar denominated commodity, to its highest price in nearly four months. China’s monthly data is due to be released this weekend and the PBoC has already laid the ground work for a massive stimulus package if data does not print well.

Date

Last

Open

High

Low

Change %

Sep 07, 2012

1735.45

1698.45

1741.95

1688.85

2.17%

Sep 06, 2012

1698.55

1691.85

1713.35

1691.25

0.39%

Sep 05, 2012

1691.95

1692.65

1694.95

1687.25

-0.04%

Sep 04, 2012

1692.55

1692.15

1698.75

1688.05

0.01%

Sep 03, 2012

1692.35

1688.45

1695.15

1685.35

0.23%

 Next week’s major focus for markets will be the Federal Open Market Committee meeting and market participants who are looking for higher prices are hoping for some “stimulating” words out of the monetary policy body.

Those words would be stimulating in the sense that the gold market – and most other financial markets – has priced in expectations that the FOMC will issue some sort of quantitative easing announcement when it meets Wednesday and Thursday.

Prices were up on the day and the week. The most-active December gold contract on the Comex division of the Nymex settled at $1,740.50 an ounce on Friday, up 3.1% on the week. December silver settled at $33.690 an ounce on Friday, up 7.15% on the week. 

Gold prices notched six-month highs this week after traders bought the metal on ideas that monetary stimulus is coming from the Fed. Ever since the minutes from the last FOMC meeting were released, market participants have purchased gold with the view that more liquidity is coming to the market. Chairman Ben Bernanke’s comments last week amplified those ideas when he said QE could help bring down the unemployment rate. Gold leapt higher Friday when a disappointing monthly payrolls report underscored the problems with job creation in the U.S.

Add to that the European Central Bank announcing a bond-buying program on Thursday and China increasing its fiscal stimulus programs with the announcement of new rail programs this week, making it a feast for market bulls.

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.

Historical: From 2010 to present

Highest: 1921.05 on Sep 06, 2011

Average: 1457.33 over this period

Lowest: 1044.85 on Feb 05, 2010

Major Economic Events for the week of September 3-7, 2012 actual v. forecast for Euro, GPB, the Franc, and USD

Date

Time

Currency

Event

Actual

Forecast

Previous

Sep. 03 

08:15

CHF

Retail Sales (YoY) 

3.2%

4.3%

3.3%

 

08:30

CHF

SVME PMI 

46.7

49.0

48.6

 

08:45

EUR

Italian Manufacturing PMI 

43.60

45.00

44.30

 

08:50

EUR

French Manufacturing PMI 

46.0

46.2

46.2

 

08:55

EUR

German Manufacturing PMI 

44.7

45.1

45.1

 

09:00

EUR

Manufacturing PMI 

45.1

45.3

45.3

 

09:30

GBP

Manufacturing PMI 

49.5

46.2

45.2

Sep. 04

06:45

CHF

GDP (QoQ) 

-0.1%

0.2%

0.5%

 

08:00

EUR

Spanish Unemployment Change 

38.20K

 

-27.80K

 

15:00

USD

ISM Manufacturing Index 

49.6

50.0

49.8

 

15:40

GBP

Services PMI 

53.7

51.5

51.0

Sep. 05

08:15

CHF

CPI (MoM) 

0.0%

0.1%

-0.5%

 

10:00

EUR

Retail Sales (MoM) 

-0.2%

-0.2%

0.1%

 

10:35

EUR

German 10-Year Bund Auction 

1.420%

 

1.420%

 

13:30

USD

Nonfarm Productivity (QoQ) 

2.2%

1.8%

1.6%

 

13:30

USD

Unit Labor Costs (QoQ) 

1.5%

1.5%

1.7%

Sep. 06 

08:00

GBP

Halifax House Price Index (MoM) 

-0.4%

0.3%

-0.7%

 

10:00

EUR

GDP (QoQ) 

-0.2%

-0.2%

-0.2%

 

11:00

EUR

German Factory Orders (MoM) 

0.5%

0.2%

-1.6%

 

12:00

GBP

Interest Rate Decision 

0.50%

0.50%

0.50%

 

12:00

GBP

BOE QE Total 

375B

375B

375B

 

12:45

EUR

Interest Rate Decision 

0.75%

0.75%

0.75%

 

13:15

USD

ADP Nonfarm Employment Change 

201K

140K

173K

 

13:30

USD

Initial Jobless Claims 

365K

370K

377K

 

13:30

USD

Continuing Jobless Claims 

3322K

3315K

3328K

 

15:00

USD

ISM Non-Manufacturing Index 

53.7

52.5

52.6

Sep. 07

06:45

CHF

Unemployment Rate 

2.9%

2.9%

2.9%

 

09:30

GBP

Industrial Production (MoM) 

2.9%

1.5%

-2.4%

 

09:30

GBP

Manufacturing Production (MoM) 

3.2%

2.0%

-2.9%

 

09:30

GBP

PPI Input (MoM) 

2.0%

1.7%

0.4%

 

09:30

GBP

PPI Input (YoY) 

1.4%

1.2%

-2.4%

 

09:30

GBP

Industrial Production (YoY) 

-0.8%

-2.8%

-3.8%

 

11:00

EUR

German Industrial Production (MoM) 

1.3%

0.2%

-0.4%

 

13:30

USD

Average Hourly Earnings (MoM) 

0.0%

0.2%

0.1%

 

13:30

USD

Nonfarm Payrolls 

96K

125K

141K

 

13:30

USD

Unemployment Rate 

8.1%

8.3%

8.3%

 

13:30

USD

Average Weekly Hours 

34.4

34.5

34.4

 

13:30

USD

Private Nonfarm Payrolls 

103K

138K

162K

 

15:00

GBP

NIESR GDP Estimate 

0.2%

 

0.3%

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.