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Silver Could Rise in 2014
1. Production costs
During the third quarter of 2013, silver mining costs averaged $21.39 per ounce, Tony Davis, owner of Atlanta Gold & Coin Buyers, states in an article published in The Paramus Post. That’s above the price that silver is currently selling for — $20.25 per ounce at yesterday’s close.
2. The US economy
After much speculation about when — and by how much — the US Federal Reserve would reduce its bond-buying program, the central bank announced plans at the end of December to lower it by $10 billion, to $75 billion a month, in January.
3. Oversold territory
Looking at silver from a more technical angle, Peter Zihlmann said in a Market Oracle article published this week that the white metal is currently in an oversold position that “is far worse than in 2008 or 2001.” Given that “[s]uch extremes have always been followed by strong movements to the up-side,” he believes that investors should buy now before prices jump again.
4. Asian silver demand
Finally, Davis touches on the fact that foreign countries, namely China and India, are importing increasing amounts of silver and gold. As SIN’s silver outlook outlines, Indian silver demand in particular quietly increased throughout 2013, leaving market participants wondering if the country would import more than the record 5,048 metric tons of silver it brought in back in 2008.
The verdict
As last year proved, beginning-of-year silver outlooks can easily go astray — so while a strong year may indeed be in store for the white metal, the opposite could also turn out to be true.
2013-01-16 00:30 GMT (or 01:30 MQ MT5 time) | [AUD - Employment Change]
if actual < forecast = good for currency (for AUD in our case)
==========
Australia Unemployment Rate Unchanged At 5.8%
Australia posted a seasonally adjusted unemployment rate of 5.8 percent in December, the Australian Bureau of Statistics said on Thursday.
That was in line with expectations and unchanged from the November reading.
But the Australian economy lost 22,600 jobs last month to 11,629,500 versus expectations for an increase of 10,000 jobs following the addition of 21,000 jobs a month earlier.
Full-time employment decreased 31,600 to 8,067,700 and part-time employment increased 9,000 to 3,561,800.
The participation rate was 64.6 percent - also shy of forecasts for 64.8 percent, which would have been unchanged from November.
Trading the News: U.S. Consumer Price Index (adapted from dailyfx article)
U.S. Consumer Prices are projected to increase an annualized 1.5% in December, which would mark the first advance since July, and a pickup in price growth may encourage the Federal Open Market Committee (FOMC) to further reduce its asset-purchase program as it dampens the threat for disinflation.
What’s Expected:
Time of release: 01/16/2014 13:30 GMT, 8:30 EST
Primary Pair Impact: EURUSD
Expected: 1.5%
Previous: 1.2%
Forecast: 1.4% to 1.6%
Why Is This Event Important:
A pickup in price growth may spur a further shift in the policy outlook as the Fed anticipates a more robust recovery in 2014, and the central bank may take a more aggressive approach in moving away from its easing cycle as the outlook for growth and inflation improves.
How To Trade This Event Risk
Bullish USD Trade: Consumer Prices Increased 1.7% or Greater
- Need red, five-minute candle following the CPI print to consider a short EURUSD trade
- If market reaction favors a long dollar trade, sell EURUSD with two separate position
- Set stop at the near-by swing high/reasonable distance from entry; look for at least 1:1 risk-to-reward
- Move stop to entry on remaining position once initial target is hit; set reasonable limit
Bearish USD Trade: Price Growth Remains SubduedPotential Price Targets For The Release
Gold Ends Weaker On Strong Rally in U.S. Dollar Index
Technically, February gold futures closed near mid-range and saw more corrective selling pressure. The gold market bears have the overall technical advantage. The gold bulls’ next upside near-term price breakout objective is to produce a close above solid technical resistance at the December high of $1,267.50. Bears' next near-term downside breakout price objective is closing prices below solid technical support at last week’s low of $1,212.60. First resistance is seen at Wednesday’s high of $1,244.60 and then at this week’s high of $1,255.30. First support is seen at Wednesday’s low of $1,233.50 and then at $1,225.00. Wyckoff’s Market Rating: 3.0
March silver futures prices (based on kitco article)
March silver futures prices closed near mid-range Wednesday. The market was pressured by a stronger U.S. dollar index. Silver bears have the overall near-term technical advantage. Silver bulls’ next upside price breakout objective is closing prices above solid technical resistance at $21.00 an ounce. The next downside price breakout objective for the bears is closing prices below solid technical support at last week’s low of $19.31. First resistance is seen at Wednesday’s high of $20.27 and then at $20.48. Next support is seen at Wednesday’s low of $19.905 and then at $19.75. Wyckoff's Market Rating: 3.0.
Moody's: Credit Ratings In South, Southeast Asia Will Be Largely Stable
About 85 out of 124 sovereigns carry stable rating outlooks, it said Thursday. Nonetheless, emerging economies of South and Southeast Asia will continue to face heightened credit pressures this year, partly led by the tapering of US Federal Reserve.
GOLD Technical Analysis (based on dailyfx article)
Prices are edging lower after putting in a Bearish Engulfing candlestick pattern. Breaking below support at 1240.12, the January 3 high, exposes the 1212.03-17.75 area (marked by the December 2 low and the 23.6% Fib expansion). Near-term resistance is at 1261.28, the October 11 low.
Sentiment on most emerging Asian currencies deteriorated in the last two weeks with short positions in the Singapore dollar, the Philippine peso and the Taiwan dollar at a five-month high, a Reuters poll showed on Thursday.
The Indian rupee, however, saw the largest bullish bets in one year as worries about inflation eased.
Bearish bets on the Singapore dollar and the peso rose to their largest since late August, according to the bi-weekly survey of 14 analysts.
As traders, our job is not easy (adapted from dailyfx article)
Tenet #1 Old support can become new resistance, and old resistance can become new support
One of the greatest aspects of price action is that its logical. Trends rarely develop in a straight line… usually an up-trend is a series of higher-highs, and higher-lows; while down-trends are often series of lower-lows, and lower-highs.
Tenet #2 The past cannot predict the future, but it can help work with probabilities
One of the inherent difficulties of technical analysis is that the past is not always going to be indicative of the future.
Things change…trends reverse… and new information finds its way into the market at a break-neck pace.
One of the allures of price action is that it’s one of the cleanest ways to perform technical analysis. Price action doesn’t purport to tell us anything other than the cleanest interpretation of what has happened in the past (and I call this the cleanest because there is no mathematical function introducing lag into our technical analysis).
So, we can look to buy up-trends cheaply, or to sell down-trends expensively in the effort to get the probabilities on our side as much as possible.
Tenet #3 Price levels matter
As human beings, we can’t help but think in round numbers…
Many traders will place stops or limits around whole numbers; like the price of .9000 on AUDUSD. And when the price on Aussie ripped down to .9000, those sitting orders changed the order flow (and the price) massively.
Trading the News: U.K. Retail Sales (based on this article)
Household spending in the U.K. is expected to increase another 0.3% during the month of December, and a positive print may push the GBPUSD back towards the 1.6600 handle as the stronger recovery raises the Bank of England’s (BoE) scope to normalize monetary policy ahead of schedule.
What’s Expected:
Time of release: 01/17/2013 9:30 GMT, 4:30 EST
Primary Pair Impact: GBPUSD
Expected: 0.3%
Previous: 0.4%
Forecast: 0.3% to 0.4%
Why Is This Event Important:
A pickup in private consumption may encourage BoE Governor Mark Carney to adopt a more hawkish tone for monetary policy, and the central bank may show a greater willingness to lift the benchmark interest rate later this year amid the growing threat for a housing bubble.
How To Trade This Event Risk
Bullish GBP Trade: Retail Sales Climbs 0.3% or Greater
Bearish GBP Trade: Household Spending DisappointsNovember 2013 U.K. Retail Sales :