Metals Market Waiting For News From Chinese Communist Party Meeting

 

Gold is trading at 1278.20 down by just about $3.00 in the Asian session as the US dollar gains momentum. The dollar continues to see positive sentiment since strong data reports last week. The US GDP printed at 2.8% against expectations of 2.0% followed by the release of the nonfarm payroll data which showed a strong climb in jobs creation. New jobs reported at 204k against forecast of only 120k. Gold held losses near a three-week low as investors assessed the strength of the U.S. economy and when the Fed Reserve will begin to reduce stimulus. There is a long list of Fed speakers on the calendar as traders hope to get some insight into the possibility of tapering at their December meeting.  Today during the day gold prices are expected to remain lower while it could be volatile during the European session as there are lot of economic data expected from Germany and the UK. Traders can expect that the WPI and CPI data expected from Germany might come in slight mixed. However, in next month the CPI numbers might improve post the ECB took a stance in cutting interest rate by 0.25%. However, as the day proceeds if currency appreciates then possibly then the gains in gold prices could be limited. For the day we believe gold may remain marginally higher at the local market while speculators can continue to hold a bearish view on gold at the COMEX platform. From the investment side gold holdings at the world’s largest gold backed ETF the SPDR gold trust continues to remain lower. Monday the holdings were 868.42 tons.

Silver and copper are both trading in the red this morning ahead of announcements from the Communist Chinese Party meeting, with new guidelines of economic reform. Silver is trading at 21.123 down by 159 points. Following the broader trend in the bullion complex, silver prices for most active contract at the Comex closed on Monday at a loss of 0.15% to $21.28 per ounce and recorded its eighth loss in last nine trading sessions.

Copper is trading at 3.249 down by 9 points today following yesterday’s slight rise. Copper prices rose slightly on Monday on optimism over economic recovery in US and China. However, holiday in US and many European countries lowered volumes and limited the upside in prices. China’s refined copper output reached 637,958 tons in October, hitting a record for the second straight month, increasing fears of a huge market surplus in 2013 and 2014. Base metals are expected to remain in range as investors would await the announcement of reforms at the Chinese Communist Party meet ending today, which could support Chinese economic growth.