Gold Weekly Fundamental Analysis June 11-15, 2012, Forecast

Introduction: Gold prices always rise when there is uncertainty in the global economy. In times of uncertainty, investors tend to run towards gold. Suppose, rumors are flying high about some event in the world and this is increasing the uncertainty in the financial markets.

• Gold reacts to uncertainty in the markets
• Gold reacts to the Federal Reserve and monetary policy
• A drop in major currencies can indicate a run into gold.
• Remember investors tend to take profit from gold so watch for trading opportunities when investors are taking profits, not moving out of the markets.

 

Weekly Analysis and Recommendations:

Gold traded sideways on Friday after bobbing up and down all day. The commodity has declined from a high of 1642.15 earlier in the week to close the week at 1594.35

Date	Last	Open	High	Low	Change %
Jun 08, 2012	1594.35	1593.15	1596.15	1559.35	0.08%
Jun 07, 2012	1593.05	1623.55	1630.35	1580.75	-1.90%
Jun 06, 2012	1623.85	1619.25	1642.15	1614.85	0.28%
Jun 05, 2012	1619.35	1620.95	1624.85	1613.85	-0.10%
Jun 04, 2012	1621.05	1618.15	1629.55	1610.25	0.19%

Gold prices were quite stable during the initial sessions, as the negative sentiments in Europe limited the downside in gold prices. Later we saw gold prices falling drastically after the Fed chairman gave no hints on the QE3, which dampened the gold’s appeal as a safe haven. Prices fell below $1600 for the first time in the week on Friday.

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 June 4 – 8 actual v. forecast for Euro, GPB, the Franc, and USD

Date	Currency	Event	Actual	Forecast	Previous
Jun 5	USD	ISM Non-Manufacturing PMI	53.7	53.6	53.5
	GBP	Construction PMI	54.4	54.5	55.8
Jun 6	EUR	Minimum Bid Rate	1.00%	1.00%	1.00%
	CHF	Foreign Currency Reserves	303.8B		237.6B
Jun 7	CHF	CPI m/m	0.0%	0.1%	0.1%
	GBP	Services PMI	53.3	52.6	53.3
	EUR	Spanish 10-y Bond Auction	6.04|3.3		5.74|2.4
	GBP	Asset Purchase Facility	325B	325B	325B
	GBP	Official Bank Rate	0.50%	0.50%	0.50%
	USD	Unemployment Claims	377K	381K	389K
	GBP	PPI Input m/m	-2.5%	-1.2%	-1.4%
Jun 8	USD	Trade Balance	-50.1B	-49.4B	-52.6B

Historical

Highest: 1921.05 on Sep 06, 2011

Average: 1418.48 over this period

Lowest: 1026.95 on Oct 28, 2009

 

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

Date	Time	Currency	Event	Forecast	Previous
Jun 11	6:45	EUR	French Industrial Production m/m		-0.9%
	23:01	GBP	RICS House Price Balance		-19%
Jun 12	5:45	CHF	SECO Economic Forecasts
	8:30	GBP	Manufacturing Production m/m		0.9%
	14:00	GBP	NIESR GDP Estimate		0.1%
Jun 13	7:15	CHF	PPI m/m		-0.1%
	9:00	EUR	Industrial Production m/m		-0.3%
Jun 14	7:30	CHF	Libor Rate	<0.25%	<0.25%
	7:30	CHF	SNB Monetary Policy Assessment
	7:30	CHF	SNB Press Conference
	8:00	CHF	SNB Financial Stability Report
	8:00	EUR	ECB Monthly Bulletin
	9:00	EUR	CPI y/y		2.4%