Silver Weekly Fundamental Analysis July 23-27, 2012, Forecast

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Introduction: Silver futures are standardized, exchange-traded contracts in which the contract buyer agrees to take delivery, from the seller, a specific quantity of silver (eg. 30000 grams) at a predetermined price on a future delivery date.

Some Facts about Silver

Silver is a soft, shiny and heavy metallic element with a brilliant white luster. A very ductile and malleable metal, its thermal and electrical conductivity is the highest of all known metals.

Besides being used as a store of value, other main uses of silver include applications in areas such as electronics, photography and as antiseptics.

Consumers and producers of silver can manage silver price risk by purchasing and selling silver futures. Silver producers can employ a short hedge to lock in a selling price for the silver they produce while businesses that require silver can utilize a long hedge to secure a purchase price for the commodity they need.

Silver futures are also traded by speculators who assume the price risk that hedgers try to avoid in return for a chance to profit from favorable silver price movement. Speculators buy silver futures when they believe that silver prices will go up. Conversely, they will sell silver futures when they think that silver prices will fall.

Weekly Analysis and Recommendations:

Silver closed the week at 27.267 after beginning at 27.372 as it bounced around all week as the metals pack looked good and bad. China’s growth pressured the markets, but the weak dollar supported industrial metals. Gold and silver benefited from moves to precious metals until Friday when investors turned back to the USD as the euro tumbled to end the week below 1.22.

Date

Last

Open

High

Low

Change %

Jul 20, 2012

27.267

27.248

27.395

26.773

0.01%

Jul 19, 2012

27.265

27.125

27.570

27.115

0.52%

Jul 18, 2012

27.123

27.283

27.340

26.865

-0.61%

Jul 17, 2012

27.290

27.308

27.595

26.767

-0.03%

Jul 16, 2012

27.298

27.372

27.390

26.865

-0.29%

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 July 16 – 20 actual v. forecast for Euro, GPB, the Franc, and USD

Date

Currency

Event 

Actual

Forecast

Previous

Jul 16

EUR

Core CPI y/y

1.6%

1.6%

1.6%

 

USD

Core Retail Sales m/m

-0.4%

0.1%

-0.4%

 

USD

Empire State Manufacturing Index

7.4

3.9

2.3

Jul 17

GBP

CPI y/y

2.4%

2.8%

2.8%

 

GBP

RPI y/y

2.8%

3.0%

3.1%

 

EUR

German ZEW Economic Sentiment

-19.6

-17.3

-16.9

 

USD

Core CPI m/m

0.2%

0.2%

0.2%

 

USD

TIC Long-Term Purchases

55.0B

45.7B

27.2B

 

USD

Capacity Utilization Rate

78.9%

79.2%

78.7%

 

USD

Industrial Production m/m

0.4%

0.4%

-0.2%

Jul 18

GBP

Claimant Count Change

6.1K

6.2K

6.9K

 

GBP

Unemployment Rate

8.1%

8.2%

8.2%

 

CHF

ZEW Economic Expectations

-42.5

 

-43.4

 

USD

Building Permits

0.76M

0.77M

0.78M

 

USD

Housing Starts

0.76M

0.74M

0.71M

 

USD

Crude Oil Inventories

-0.8M

0.5M

-4.7M

Jul 19

CHF

Trade Balance

2.25B

2.21B

2.52B

 

EUR

Current Account

10.9B

5.3B

5.5B

 

GBP

Retail Sales m/m

0.1%

0.6%

1.5%

 

USD

Unemployment Claims

386K

367K

352K

 

USD

Existing Home Sales

4.37M

4.64M

4.62M

 

USD

Philly Fed Manufacturing Index

-12.9

-7.9

-16.6

Jul 20

EUR

German PPI m/m

-0.4%

-0.2%

-0.3%

 

GBP

Public Sector Net Borrowing

12.1B

11.8B

16.1B

Historical:

Highest: 49.813 on Apr 25, 2011

Average: 27.592 over this period.

Lowest: 14.655 on Feb 05, 2010

 

 

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

Date

Time

Currency

 Event

Previous

Jul 24

7:00

EUR

French Flash Manufacturing PMI

45.2

7:00

EUR

French Flash Services PMI

47.9

7:30

EUR

German Flash Manufacturing PMI

45.0

7:30

EUR

German Flash Services PMI

49.9

8:00

EUR

Flash Manufacturing PMI

45.1

8:30

GBP

BBA Mortgage Approvals

30.2K

9:00

EUR

Flash Services PMI

47.1

13:00

USD

Flash Manufacturing PMI

52.5

Jul 25

8:00

EUR

German Ifo Business Climate

105.3

 

8:30

GBP

Prelim GDP q/q

-0.3%

10:00

GBP

CBI Industrial Order Expectations

-11

13:00

EUR

Belgium NBB Business Climate

-13.2

14:00

USD

New Home Sales

369K

14:30

USD

Crude Oil Inventories

 

Jul 26

6:00

EUR

GfK German Consumer Climate

5.8

8:00

EUR

M3 Money Supply y/y

2.9%

12:30

USD

Core Durable Goods Orders m/m

0.7%

12:30

USD

Unemployment Claims

 

14:00

USD

Pending Home Sales m/m

5.9%

Jul 27

27th-31st

GBP

Nationwide HPI m/m

-0.6%

All Day

EUR

German Prelim CPI m/m

-0.1%

7:00

CHF

KOF Economic Barometer

1.16

12:30

USD

Advance GDP q/q

1.9%

13:55

USD

Revised UoM Consumer Sentiment

72.0

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About: FX Empire Analyst - Barry Norman

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