Gold and Oil Prices Go Up the Most in three Months (based on forexminute article)
The year 2014 so far has been good for gold and oil. This week, both
i.e. oil and gold have hit multi-month peaks this on improved demand
prospects in the world's two biggest economies, the United States and
China. Also, there is a lot of contribution of poor dollar in the gain
the oil and gold have received in the last week.
Earlier on Wednesday, U.S. crude struck the highest level for four
months at USD 100.37 a barrel. A similar trend was seen in Brent; it
achieved the steepest peak since the start of year at around the USD 110
a barrel mark and according to market observers renewed concerns of
colder weather in the U.S. bolstered support for the oil prices.
In its statement earlier the International Energy Agency (IEA) said a
pickup in demand in advanced countries, led by the United States is a
major reason behind the gain. It says that due to increased demand in
the U.S. and other advanced economies even a slowing of emerging market
consumption has not been able to affect the oil prices.
Nevertheless, though the demand for oil have slowed to some extent in
developing economies, global oil markets are unexpectedly tight as
growth in advanced economies picks up. Major growth has been from China
and it is the one that is supporting the oil prices this week. The
country has increased its imports in crude oil this week.
According to the data from China it is the world`s top energy consumer.
It imported a record 6.63 million barrels of crude oil per day in
January, up 5.2 percent from December. Thus, so far the country has
played a vital role in the gain of crude oil prices.
On the other hand, gold hit a three-month peak at USD 1,321.52 an ounce
which is the highest point since November 7. A similar trend was seen in
the prices of silver which gained a three-month high at as it reached
USD 21.30 an ounce. According to market observers precious metals are
continuing to make up ground lost during last year`s slump.
Market observers believe that a lot of contribution in the increase of
gold and oil prices is from weak dollar. The USD has been impacted a lot
by underwhelming US economic pointers such as retail sales and
Forex Compared to Other Markets (adapted from dailyfx article)
Forex Market (Spot Forex)
The Forex market, sometimes referred to as spot Forex, is the largest
market in the world with over $5 trillion in volume each day.
Participants buy and sell currencies "Over-the-counter" 24 hours a day, 5
days a week. Some of the more popular benefits to Forex trading are:
Silver Global Price Forecast: The Sterling Opportunity
Precious metals were under pressure last year, but investors
continued to accumulate silver while gold had a record amount outflow
We can see this by looking at the physically backed iShares Silver
Trust SLV is up 25 million ounces Oct. 31, 2013 since January 2013.
While physical holdings in the SPDR Gold Shares GLD shrunk by 28 million
Investment demand for silver now accounts for 24% of overall demand,
up from only 4% in 2003 after the introduction of ETFs as a liquid
trading source. Additionally, silver investors typically include small
investors, whereas large institutional investors have steered toward
Unlike gold… silver is consumed by industrial and medical usage.
Silver’s relative affordability and industrial usage is helping bolster
Silver is used in consumer electronics like touch screens found in
smart phones and tablets, medical equipment. As such, silver has proven
virtually indispensable in almost all electronic devices.
Forbes Fundamentals : In this shortened Tuesday-Friday trading week, investors will watch
minutes from the Federal Reserve on Wednesday and key U.S. housing and
inflation data scattered from Wednesday to Friday.
U.S. stock indices are back near record highs following a storm of
corporate and economic news in recent weeks. The appetite for U.S.
shares seems as strong as ever.
More hawkish than expected = good for currency (for AUD in our case)
Aussie Pares Post-RBA Gain; BlackRock Sees Drop to 85 U.S. Cents
The Australian dollar touched a one-month high after the Reserve Bank said there were further signs
easy policy and a weak currency were having an impact. Strength
in the Aussie won’t be sustained, BlackRock Inc. said.
The Aussie rose against the yen after the Bank of Japan
boosted lending programs. Australia’s currency held a climb
against most major peers after minutes of the RBA’s last meeting
signaled “a period of stability in interest rates.” Sustained
declines in the Aussie would help the nation’s economy adjust to
a drop in mining activity, the RBA said, avoiding comments about
the currency being too high.
“There is less emphasis on the level of the currency
assisting in the rebalancing of the Australian economy,” said
Robert Rennie, the global head of currency and commodity
strategy at Westpac Banking Corp. in Sydney. “If they wanted
to, they could have added more concern that Australia needs a
sustainably low level for the currency. The fact that they did
not, should help the Aussie dollar pop.”
Australia’s dollar was at 90.43 U.S. cents as of 5:16 p.m.
in Sydney, from 90.32 yesterday, and touched 90.81, the highest
level since Jan. 13. It gained 0.8 percent to 92.81 yen and
climbed 0.4 percent to NZ$1.0833.
The Aussie may climb to 92 U.S. cents, said Rennie.
2013-02-18 03:30 GMT (or 04:30 MQ MT5 time) | [JPY - Monetary Policy Statement]
More hawkish than expected = good for currency (for JPY in our case)
Yen Dropped Against Dollar After BOJ's Statement
Yen dropped against dollar and other major currencies, after the
Bank of Japan decided to expand its lending program by 60 trillion to 70
trillion yen per year, in order to realize the targeted inflation of
BOJ also doubled a core part of a growth lending program to 7
trillion yen, leading to forecasts that next month will witness more
stimulus measures added to financial markets. Hence, the government
expects the new sales tax increase in April to have a strong negative
impact on the economy, so it needed further monetary stimulus to
overcome such negative effect.
Nevertheless, USD/JPY gained for the second straight day to record a
high of 102.49, while it was trading near 102.05 levels before the
released statement. Euro also picked up against yen to reach the highest
in three weeks at 140.55 from a low of 139.87.
2013-02-18 14:00 GMT (or 15:00 MQ MT5 time) | [USD - TIC Long-Term Purchases]
if actual > forecast = good for currency (for USD in our case)
US TIC long term flows at -$45.9bn