Gold Weekly Fundamental Analysis September 3-7, 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 ended the week at 1691.65, unable to break through to the 1700.00 price range. Gold for the week traded steadily on global hopes for monetary stimulus from the Feds and the hopes that Mr. Bernanke would introduce the same at his Jackson Hole address. As rumors and press swirled all week so did the price of gold. Falling mid week when Mr. Draghi announced his withdrawal from the conference. As each piece of eco data was released in the US, if it was positive market sentiment shifted believing that each piece of data lowered expectations from the Feds.

Date

Last

Open

High

Low

Change %

Aug 31, 2012

1691.65

1655.35

1693.05

1646.45

2.21%

Aug 30, 2012

1655.05

1656.55

1664.25

1651.45

-0.10%

Aug 29, 2012

1656.75

1667.25

1670.25

1652.45

-0.62%

Aug 28, 2012

1667.15

1665.65

1672.55

1657.65

0.08%

Aug 27, 2012

1665.75

1674.35

1677.45

1663.35

-0.51%

When Mr. Bernanke spoke, markets immediately took his speech as negative, as he did not introduce any QE or make any commitments, but once traders took the time to interpret his words they realized that he had been setting the stage for the FOMC meeting later this month.

The heightened expectations for fresh quantitative easing (QE3) are music to most commodity market bulls’ ears, including gold and silver. It’s also stock-market-bullish and U.S. dollar-bearish.

Friday was the last trading day of the month, which makes it an extra important trading day from a technical perspective—and the gold and silver bulls even took full advantage of that by pushing prices to multi-month highs. The gold and silver bulls gained fresh, solid upside technical momentum Friday, to suggest that prices can continue to trend sideways to higher for at least the near term. 

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.

Tier 1 and 2 Economic Releases for August 27-31, 2012

Date

Currency

Event

Actual

 

Forecast

Previous

Aug. 27

SEK

Swedish Retail Sales (MoM) 

0.30%

 

0.20% 

-0.30% 

 

EUR

German Ifo Business Climate Index 

102.3

 

102.6 

103.2 

 

EUR

German Current Assessment 

111.2

 

110.8 

111.5 

 

EUR

German Business Expectations 

94.2

 

95.0 

95.5 

Aug. 28

AUD

HIA New Home Sales (MoM) 

-5.6%

 

 

2.8% 

 

EUR

GfK German Consumer Climate 

5.9

 

5.9 

5.9 

 

USD

CB Consumer Confidence 

60.6

 

66.0 

65.4 

Aug. 29

AUD

Construction Work Done (QoQ) 

-0.2%

 

1.0% 

7.8% 

 

CHF

KOF Leading Indicators 

1.57

 

1.50 

1.41 

 

EUR

German CPI (MoM) 

0.3%

 

0.2% 

0.4% 

 

USD

GDP (QoQ) 

1.7%

 

1.7% 

1.5% 

 

USD

Pending Home Sales (MoM) 

2.4%

 

1.0% 

-1.4% 

 

USD

Beige Book 

 

 

 

 

 

NZD

Building Consents (MoM) 

2.0%

 

3.0% 

5.7% 

Aug. 30

JPY

Retail Sales (YoY) 

-0.8%

 

-0.2% 

0.2% 

 

AUD

Building Approvals (MoM) 

-17.3%

 

-5.0% 

-1.0% 

 

AUD

Private New Capital Expenditure (QoQ) 

3.4%

 

2.4% 

7.7% 

 

EUR

German Unemployment Change 

9K

 

8K 

9K 

 

USD

Core PCE Price Index (MoM) 

0.0%

 

0.1% 

0.2% 

 

CAD

Current Account 

-16.0B

 

-15.0B 

-10.2B 

 

USD

Personal Spending (MoM) 

0.4%

 

0.4% 

0.0% 

 

USD

Initial Jobless Claims 

374K

 

370K 

374K 

 

USD

Continuing Jobless Claims 

3316K

 

3307K 

3321K 

Aug. 31

KRW

South Korean Industrial Production (YoY) 

0.3%

 

0.5% 

1.4% 

 

JPY

Unemployment Rate 

4.3%

 

4.3% 

4.3% 

 

JPY

Tokyo Core CPI (YoY) 

-0.5%

 

-0.6% 

-0.6% 

 

JPY

Industrial Production (MoM) 

-1.2%

 

1.7% 

0.4% 

 

GBP

Nationwide HPI (MoM) 

1.3%

 

0.1% 

-0.8% 

 

EUR

CPI (YoY) 

2.6%

 

2.5% 

2.4% 

 

EUR

Unemployment Rate 

11.3%

 

11.3% 

11.3% 

 

CAD

GDP (MoM) 

0.2%

 

0.1% 

0.1% 

 

USD

Chicago PMI 

53.0

 

53.5 

53.7 

 

USD

Michigan Consumer Sentiment 

74.3

 

73.6 

73.6 

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

 

Economic Highlights for the upcoming week… Tiers 3 keep your eyes on these

Date

Time

Currency

Event

Forecast

 

Previous

 

 

Sep. 04

05:30

AUD

Interest Rate Decision 

3.50% 

 

3.50% 

 

 

 

15:00

USD

ISM Manufacturing Index 

50.0 

 

49.8 

 

 

Sep. 05

02:30

AUD

GDP (QoQ) 

0.8% 

 

1.3% 

 

 

 

14:00

CAD

Interest Rate Decision 

1.00% 

 

1.00% 

 

 

Sep. 06

02:30

AUD

Employment Change 

5.0K 

 

14.0K 

 

 

 

02:30

AUD

Unemployment Rate 

5.3% 

 

5.2% 

 

 

 

12:00

GBP

Interest Rate Decision 

0.50% 

 

0.50% 

 

 

 

12:45

EUR

Interest Rate Decision 

0.75% 

 

0.75% 

 

 

Sep. 07

15:00

CAD

Ivey PMI 

58.0 

 

62.8 

   

Government Bond Auction

Date  Time  Country 

Sep 03  09:10  Norway  Bond auction

Sep 03  10:00  Belgium  OLO auction

Sep 04  00:30  Japan  Auctions 10Y JGBs

Sep 04  09:15  Austria  Bond auction

Sep 04  09:30  Belgium  Auctions Dec 2012 (3M) & Feb 2013 (6M) T-bills

Sep 04  14:30  UK  Details 0.75% 2034 I/L Gilt & 1.75% Sep 2022 Gilt on Sep

Sep 05  09:10  Sweden  Nominal bond auction

Sep 05  09:30  Germany  Eur 5.0bn Sep 2022 Bund auction

Sep 05  09:30  UK  4.5% 2042 Gilt auction

Sep 06  00:30  Japan  Auctions 30Y JGBs

Sep 06  08:30  Spain  Bono auction

Sep 06  08:50  France  OAT auction

Sep 06  09:10  Sweden  I/L bond auction

Sep 06  15:00  US  Announces 3Y Notes on Sep 11, 10Y Notes on Sep 12 &

Sep 07  15:30  Italy

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About: FX Empire Analyst - Barry Norman

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