The most actively traded contract, for April delivery, was recently
up $9.40, or 0.8%, at $1,206.70 a troy ounce on the Comex division of
the New York Mercantile Exchange.
Gold inched up from a one-month
low as some investors saw a bargain while others returned to the market
following Lunar New Year celebrations in China. The country is the
world’s second-largest gold buyer after India, but investors there
typically stay on the sidelines during the holiday.
dollar also sent some investors into gold in a bid to protect their
wealth. The WSJ Dollar Index was recently down 0.2% at 85.28.
“Gold is acting more as a currency hedge at this point,” said
a portfolio manager at Kingsview Asset Management in Chicago.
if actual > forecast (or previous data) = good for currency (for NZD in our case)
[NZD - Trade Balance] =Difference in value between imported and exported goods during the reported month. Export demand and currency demand are directly linked because foreigners
must buy the domestic currency to pay for the nation's exports. Export
demand also impacts production and prices at domestic manufacturers
New Zealand Has NZ$56 Million Trade Surplus
New Zealand had a merchandise trade surplus of NZ$56 million in January, Statistics New Zealand said on Thursday.
topped expectations for a deficit of NZ$158 million following the
downwardly revised NZ$195 million shortfall in December (originally
Exports were worth NZ$3.70 billion - shy of
expectations for NZ$3.73 billion and down from the downwardly revised
NZ$4.40 billion in the previous month (originally NZ$4.42 billion).
were at NZ$3.64 billion versus forecasts for NZ$3.94 billion following
the upwardly revised NZ$4.60 billion a month earlier (originally NZ$4.58
Gold trade coming back, if you can wait 2 years (based on cnbc article)
Gold will come under further pressure over the course of the
year as the Federal Reserve moves closer to lifting rates, but
prospects for the precious metal looks far more promising in the next
few years, according to Bank of America Merrill Lynch.
"Right now, investors are not in the mood for
holding gold because they see the Fed raising rates. So, I think in the
next three months you'll see downside risk, $1,100 an ounce is likely,"
Francisco Blanch, commodities analyst at Bank of America Merrill Lynch
"But if you look out 2-3 years, things are a lot brighter for gold," he said.
Gold kicked off the year with a bang, rising
around 8 percent in January. However, the yellow meal has since erased
most of its gains as a stronger dollar – driven by rate hike
expectations –and gains in equities dim its appeal. Spot gold last
traded around the $1,210 level.
Blanch's positive longer-term outlook for gold is driven by two factors.
First, the growing phenomenon of negative-yielding bonds, which makes gold look attractive in comparison.
"There are a growing number of government bonds
basically yielding zero or negative. As the number increases, I think a
lot of investors are going to wonder why they are holding a liability as
opposed to holding an outright asset like gold," he said.
Why You Should Have a Gold and Silver Seat Belt
Take a quick look at our financial system. Have things really improved since the entire global system almost went down in 2008?
Exchanging some of your “paper promises” (currency) for the physical
financial reality of gold and silver on a regular basis makes more than
just good business sense. It helps make sure that come what may in your
financial life, your “financial insurance policy” will be there to help
you out, when, not if, the chickens from so many years of unsound
government policies come home to roost. Look toward Argentina,
Venezuela, Russia and others as harbingers. Even now, the U.S. inflation
rate is arguably several percent higher than the “official” figure. You
would do well to pay attention and plan accordingly.
Trading the News: U.S. Gross Domestic Product (GDP) (based on dailyfx article)
A marked downward revision in the U.S. growth rate may generate a
short-term rebound in EUR/USD should the preliminary 4Q Gross Domestic
Product (GDP) report dampen bets for a mid-2015 Fed rate hike.
Why Is This Event Important:
Despite bets for higher borrowing-costs, further weakness in the core
Personal Consumption Expenditure (PCE), the Fed’s preferred gauge for
inflation, may push Chair Janet Yellen to endorse a wait-and-see
approach and further delay the normalization cycle as the central bank
struggles to achieve the 2% target for price growth.
Nevertheless, the uptick in private wages paired with the ongoing
improvement in the labor market may foster a better-than-expected GDP
report, and bets for a stronger recovery may heighten the bullish
sentiment surrounding the U.S. dollar as the Fed remains on course to
remove the zero-interest rate policy (ZIRP) over the near to
How To Trade This Event Risk
Bearish USD Trade: Growth Rate Narrows to 2.0% or Lower
MetaTrader Trading Platform Screenshots
EURUSD, M5, 2015.02.27
MetaQuotes Software Corp., MetaTrader 5
EURUSD M5: 19 pips price movement by USD - GDP news event
AUDIO - Finding Great Trading Opportunities with Gabe Velazquez
Over the past week, many listeners have expressed frustration with no quality supply levels on the major market indexes. Gabe Velazquez joins Merlin
to look at alternatives to trading the indexes, and talks about how he
is trading these markets. The duo also look at the surge in the US
Dollar and how it is impacting and creating trading opportunities with
Forex Weekly Outlook Mar. 2-6 (based on forexcrunch article)
The euro was the loser in week that saw the dollar retreat and make a
comeback. The first week of the new month is packed: rate decisions in
Australia, Canada, the UK and the euro-zone, GDP data from Canada and
Australia and a full buildup to the US Non-Farm Payrolls. These are the
main market movers on FX Calendar. Join us as we explore the highlights
of this week.
Janet Yellen managed to send mixed signals and was analyzed as dovish.
However, was she preparing us for the removal of forward guidance? Her
colleague Bullard was quite bullish. US data came out mixed: jobless
claims rose to 313,000, and CPI declined 0.7% due to continued slide in
oil prices, while Core CPI surprised with a 0.2% rise and maintained a
stable 1.6% y/y figure. The latter number trumped the others and allowed
the dollar to make a comeback. In the euro-zone, the Greek list was
approved and the crisis is off for now. Data has been somewhat upbeat.
UK GDP remained supportive of the pound while in Australia, speculation
mounts about an RBA cut. We’ll get lots of answers now.
US Dollar Fundamentals (based on dailyfx article)
Fundamental Forecast for Dollar: Neutral
The Dollar received a jolt of volatility this past
week in a rally that followed the CPI inflation report, but the currency
was unable to escape the bounds of a month-long range. It will be increasingly difficult to maintain a range going forward however. Not only are major themes like US rate forecasts and risk trends developing, but we have a range of high profile event risk.
While US indicators like the February NFPs will provide a clear
connection to Dollar activity; policy decisions by some of the Fed’s
largest counterparts – the ECB, BoE, RBA and BoC – can generate
considerable indirect force.
For Dollar traders, the outlook is steeped in two
key fundamental themes: monetary policy and speculative sentiment. It is
the former that has fed the Greenback’s bullish trend these past nine
months (the ICE Dollar Index secured an eighth consecutive rally
– a record- while the Dow Jones FXCM Dollar Index closed the month
slightly lower). Yet, just as clear as the ‘relative’ hawkish outlook
for the Fed has generated such a resounding performance, we can also see
its limitations shaped through the month-long consolidation pattern the
benchmark established through February.
Compared to the ECB and BoJ (who are executing
quantitative easing programs) or the RBA and BoC (which have recently
cut their benchmark rates), the FOMC
is exceptionally hawkish. Though it is still plotting the time frame
for its first hike in a controlled normalization regime, a tightening
move offers drastic contrast. Much of this has been priced in however.
Currently, the market expects a first and second rate hike in 2015 –
something the other majors cannot claim. To leverage further gains on
this view though, the lead needs to be extended.
According to Fed Fund futures, the first move by the Fed is expected around the October 28 meeting.
Alternatively, surveys for economists, analysts and primary dealers
pegs it around June 17 or July 29. That opens the door for more
progress. A few particular data points stand out over the coming week
that can up the market’s expected time frame – or push it back depending
on the outcome. At the start of the week, we have the PCE inflation
measures. Given that this is the Fed’s preferred price gauge, a surprise
here could generate a greater market response than the heft Dollar bid
that followed last week’s CPI release. At the end of the week, the
February labor data will be a media and speculative focus. While the
payrolls and jobless figure are important, we know the general trend of
the past five years. The missing puzzle piece for hikes is inflation.
And that leverages the importance of the average hourly wages component which last month posted the biggest monthly jump since December 2008.
A change in tide and intensity of the US rate
forecast is the most direct means to motivate the Dollar, but don’t
write off the strengthening or weakening of its collective counterparts
as a capable impetus. The ECB is set to activate its stimulus program
while the RBA and BoC are expected to each supply a consecutive interest
rate cut. There is plenty of room to broaden or close that gap.
There will be plenty on the docket
– and no doubt newswires – to occupy our attention in the week ahead.
Yet, it is important to maintain a firm grasp of the ‘big picture’. The
view of US monetary policy compared to its conterparts is a node, but
how collective monetary policy influences global investor sentiment is a
central pillar. ‘Risk appetite’ has not contributed much to the
Dollar’s cause – bullish or bearish – recently as it has not moved with
conviction (regardless of what it seems the S&P 500
is doing). It is difficult to instill confidence of a robust extension
of already mature risk accumulation trends. In contrast, the correct spark can ignite an explosive value gap to risk aversion and deleveraging. When this reallocation hits, the Dollar will gain at the extremes.