Silver Forecast September 24, 2012, Technical Analysis

Silver markets rose during the Friday session, but came back down under the $35 level in order to form a shooting star. This is part of a cluster between $34 and $35, and as such we think we are simply consolidating at this area.

The move recently has been straight, and as such a little bit of a rest would be a huge surprise. In fact, it would be a very healthy thing for this very bullish market. We are buying silver on the dips, and do hold quite a bit of physical silver, as well as the as SLV ETF and the occasional silver futures contract.

We consider the SLV and physical metal our “core holdings”, with the futures market as a way to boost all our returns. Looking forward, we see absolutely no reason to sell silver, and certainly wouldn’t do it until we get well below the $25 level.

 

Silver Forecast September 24, 2012, Technical Analysis
Silver Forecast September 24, 2012, Technical Analysis

Silver Weekly Fundamental Analysis September 24-28, 2012 Forecast

Introduction: Silver futures are standardized, exchange-traded contracts in which the contract buyer agrees to take delivery, from the seller, a specific quantity of silver (eg. 30000 grams) at a predetermined price on a future delivery date.

Some Facts about Silver

Silver is a soft, shiny and heavy metallic element with a brilliant white luster. A very ductile and malleable metal, its thermal and electrical conductivity is the highest of all known metals.

Besides being used as a store of value, other main uses of silver include applications in areas such as electronics, photography and as antiseptics.

Consumers and producers of silver can manage silver price risk by purchasing and selling silver futures. Silver producers can employ a short hedge to lock in a selling price for the silver they produce while businesses that require silver can utilize a long hedge to secure a purchase price for the commodity they need.

Silver futures are also traded by speculators who assume the price risk that hedgers try to avoid in return for a chance to profit from favorable silver price movement. Speculators buy silver futures when they believe that silver prices will go up. Conversely, they will sell silver futures when they think that silver prices will fall.

Weekly Analysis and Recommendations:

Silver had an interesting week soaring on the heels of gold but also well supported on the industrial side. Every time markets began to worry about growth and manufacturing, more stimulus money was offered helping increase future demands on the metals. The Bank of Japan announced new stimulus followed by the PBoC. Silver broke above 35.00 per ounce during the weeks trading session and ended the week at 34.57

Date

Last

Open

High

Low

Change %

Sep 21, 2012

34.570

34.690

35.228

34.383

-0.30%

Sep 20, 2012

34.675

34.683

34.795

34.133

-0.04%

Sep 19, 2012

34.688

34.735

35.023

34.325

-0.10%

Sep 18, 2012

34.722

34.248

35.073

34.023

1.37%

Sep 17, 2012

34.253

34.755

34.798

33.863

-1.45%

Silver has been outperforming gold over the past 10 weeks as investors are hoarding and buying poor man’s gold to hedge against worldwide quantitative easing and pump-priming being implemented by Central Banks around the world to devalue their respective currencies.

The Bank of Japan joined the Fed, ECB, China, South Korea and others by announcing an aggressive stimulus program. This is extremely inflationary and bullish for gold and silver and bearish for the purported safe havens namely the U.S. dollar, long term treasuries, Euro, Yen and Yuan.

Remember Japan is the third largest economy in the world and they are currently facing an economic slowdown, rising electricity prices due to increase oil imports and is in the midst of a territorial dispute in the South China Seas with China. Japan is mimicking Bernanke’s QE decision last week to attempt to devalue their currencies to boost exports. The Japanese stimulus is massive and will now total nearly 20% of Japan’s total economy. The U.S. dollar is falling as these drastic moves were much bigger than the consensus expected.

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 September 17-21, 2012 actual v. forecast for Euro, GPB, the Franc, and USD

Date

Currency

Event

Actual

Forecast

Previous

Sep. 17

GBP

Rightmove House Price Index (MoM) 

-0.6%

 

-2.4%

 

USD

NY Empire State Manufacturing Index 

-10.4

-2.0

-5.8

Sep. 18

GBP

Core CPI (YoY) 

2.1%

2.2%

2.3%

 

GBP

CPI (YoY) 

2.5%

2.5%

2.6%

 

GBP

CPI (MoM) 

0.5%

0.5%

0.1%

 

EUR

German ZEW Economic Sentiment 

-18.2

-19.0

-25.5

 

EUR

ZEW Economic Sentiment 

-3.8

-16.5

-21.2

 

USD

Current Account 

-117.4B

-125.5B

-133.6B

 

USD

TIC Net Long-Term Transactions 

67.0B

45.3B

9.3B

Sep. 19  

USD

Building Permits 

0.803M

0.796M

0.811M

 

USD

Housing Starts 

0.750M

0.765M

0.733M

 

USD

Existing Home Sales 

4.82M

4.55M

4.47M

Sep. 20 

EUR

French Manufacturing PMI 

42.6

46.4

46.0

 

EUR

German Manufacturing PMI 

47.3

45.3

44.7

 

EUR

Manufacturing PMI 

46.0

45.4

45.1

 

GBP

Retail Sales (MoM) 

-0.2%

-0.4%

0.3%

 

GBP

Retail Sales (YoY) 

2.7%

2.7%

2.3%

 

EUR

Spanish 10-Year Obligation Auction 

5.666%

 

6.647%

 

GBP

CBI Industrial Trends Orders 

-8

-15

-21

 

USD

Initial Jobless Claims 

382K

375K

385K

 

USD

Continuing Jobless Claims 

3272K

3300K

3304K

 

USD

Philadelphia Fed Manufacturing Index 

-1.9

-4.0

-7.1

 

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

Date

Time

Currency

Event

Forecast

Previous

 Sep. 24

09:00

EUR

German Ifo Business Climate Index 

102.3

102.3

 

09:00

EUR

German Current Assessment 

110.9

111.2

 

09:00

EUR

German Business Expectations 

95.0

94.2

Sep. 25

07:00

EUR

GfK German Consumer Climate 

5.9

5.9

 

15:00

USD

CB Consumer Confidence 

62.0

60.6

Sep. 26

01:00

EUR

German CPI (MoM) 

-0.1%

0.4%

 

01:00

EUR

German CPI (YoY) 

2.0%

2.1%

 

11:00

GBP

CBI Distributive Trades Survey 

5

-3

Sep. 27 

08:55

EUR

German Unemployment Rate 

6.8%

6.8%

 

08:55

EUR

German Unemployment Change 

10K

9K

 

09:30

GBP

Current Account 

-12.4B

-11.2B

 

09:30

GBP

GDP (QoQ) 

-0.5%

-0.5%

 

09:30

GBP

GDP (YoY) 

-0.5%

-0.5%

 Sep. 28 

07:45

EUR

French Consumer Spending (MoM) 

-0.2%

0.1%

 

08:00

CHF

KOF Leading Indicators 

1.55

1.57

Government Bond Auction

Date Time Country 

Sep 24 09:10 Norway 

Sep 24 09:30 Germany 

Sep 24 10:00 Belgium 

Sep 24 15:30 Italy  

Sep 25 08:30 Holland 

Sep 25 08:30 Spain 

Sep 25 09:10 Italy  

Sep 25 14:30 UK 

Sep 25 17:00 US 

Sep 26 09:10 Italy  

Sep 26 09:10 Sweden 

Sep 26 09:00 Germany 

Sep 26 14:30 Sweden 

Sep 26 17:00 US 

Sep 27 00:30 Japan 

Sep 27 09:10 Italy  

Sep 27 17:00 US

 

Silver Fundamental Analysis September 24, 2012 Forecast

Analysis and Recommendations:

Silver followed on the heels of gold as both precious metals and industrial metals traded in the positive range today. Silver climbed above 35.00 to trade at 35.160.

Base metals bounced backed after declining the previous session buoyed by stimulus measures from the leading central banks and China’s approval of $150 billion worth infrastructure plan. Lead gained the most rising nearly two per cent followed by zinc while Copper rebounded to its four and a half month high. Yet, the weak factory activity in US, Europe and China is likely to weigh on the sentiments.

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.

Economic Data September 21, 2012 actual v. forecast

Date

 

Currency

 

 

Event

Actual

 

Forecast

 

Previous

 

 

Sep. 21

 

AUD

 

 

CB Leading Index (MoM) 

0.0%

 

 

 

0.5% 

   

 

 

NZD

 

 

Credit Card Spending (YoY) 

1.0%

 

 

 

0.1% 

 

 

 

 

EUR

 

 

Dutch Consumer Spending 

-1.50

 

 

 

-0.50 

   

 

 

GBP

 

 

Public Sector Net Borrowing 

12.4B

 

13.3B 

 

-1.9B 

   

 

 

CAD

 

 

Core CPI (MoM) 

0.3%

 

0.3% 

 

-0.1% 

 

 

 

 

CAD

 

 

CPI (MoM) 

0.2%

 

0.4% 

 

-0.1% 

 

 

 

 

CAD

 

 

Wholesale Sales (MoM) 

-0.6%

 

-0.1% 

 

-0.3% 

   

 

 

CAD

 

 

CPI (YoY) 

1.2%

 

1.0% 

 

1.3% 

 

 

 

 

EUR

 

 

Belgium NBB Business Climate 

-11.6

 

-11.2 

 

-11.8 

 

 

 

Upcoming Economic Events that affect the EUR ( there are no USD or CAD events )

Date

Time

Currency

Event

Forecast

Previous

 Sep. 24

09:00

EUR

German Ifo Business Climate Index 

102.1 

102.3 

 

09:00

EUR

German Current Assessment 

 

111.2 

 

09:00

EUR

German Business Expectations 

 

94.2 

Government Bond Auction

Date Time Country 

Sep 24 09:10 Norway 

Sep 24 09:30 Germany 

Sep 24 10:00 Belgium 

Sep 24 15:30 Italy  

Sep 25 08:30 Holland 

Sep 25 08:30 Spain 

Sep 25 09:10 Italy  

Sep 25 14:30 UK 

Sep 25 17:00 US 

Sep 26 09:10 Italy  

Sep 26 09:10 Sweden 

Sep 26 09:00 Germany 

Sep 26 14:30 Sweden 

Sep 26 17:00 US 

Sep 27 00:30 Japan 

Sep 27 09:10 Italy  

Sep 27 17:00 US 

 

 

China Climbs on the Stimulus Bandwagon and drives Gold Up

This morning, all the Asian markets are trading in the green with Hang Seng trading higher by 0.7% while Nikkei and Kospi are up 0.6% each. Shanghai and Taiwan are up by 0.5% and 0.4% respectively. Strait Times is up by 0.3%.

U.S. stocks have been stuck in a rut this week, as investors look for clues about where the global economy is headed. Thursday wasn’t any different, as the major indexes finished the day little changed. The Dow Jones rose slightly, while S&P 500 and NASDAQ finished just below the breakeven line.

An HSBC report showed that manufacturing in China continued to contract in September for the eleventh straight month. That’s worrisome for U.S. investors, since China is the world’s second-largest economy and many U.S. companies have a significant presence in the country.

Investors are still waiting to see if stimulus measures from central banks across the globe will jumpstart the global economy.

European markets came under pressure after a regional purchasing managers index fell to a 39-month low. Economists had expected the index to show a slight uptick in business activity. DAX of Germany dropped by 0.02% and CAC 40 of France finished lower by 0.6%. The FTSE 100 of the U.K. fell by 0.6%.

China’s stocks slumped, dragging down the benchmark index to the lowest level since February 2009, after a report on manufacturing signaled a contraction and escalating tensions with Japan threatened trade. Japan shares fell the most in three weeks as the yen rose and the nation’s exports declined for a third month, adding to signs of global slowdown. Stocks extended losses on China manufacturing data pointing to a contraction

The US Dollar rose against the Euro on Thursday after weak data from the United States, Europe and China stoked global growth worries, driving investors to perceived safe-haven assets. The euro slid to a one-week low against the dollar even as Spain successfully sold 4.8 billion euros ($6.27 billion) of debt.

Precious metals prices ended nearly flat as the market paused after its recent sharp rally, while a key technical-chart formation suggests momentum is turning increasing bullish. Gold is trading at 1770.85

Gold rose by 0.14% triggered by the announcement of an open-ended bond purchase program, or quantitative easing (QE3), in addition to guiding for zero interest rates until mid-2015. The European Central Bank had already announced unlimited bond-buying, while Bank of Japan this week pledged to increase its asset purchase program by a further $127-billion. Silver too increase by 0.47%.

This morning the PBoC moved to inject liquidity into its local markets, conducting 101 billion yuan ($A15.3 billion) worth of open market operations in its banking system, Reuters News reports. According to the news agency, the injection is the first in three weeks and adds to the 966 billion yuan already added to the financial system so far this year. The moves have fuelled uncertainty over the extent Beijing is willing to boost the weakening Chinese economy.  

Holdings in the SPDR Gold Trust, the world’s largest gold-backed exchange traded fund, stood at 1308.41 tonnes by Sep 20, up by 3.01 tonnes from the previous business day. Holdings in the world’s largest silver backed exchange-traded fund iShares Silver Trust stood at 9940.66 tonnes by Sep 20, up by 57.26 tonnes from the previous business day. Centerra Gold reports the resumption of milling activities at its kumtor mine site following planned shutdown. It expects to produce between 260,000-270,000 ounces of gold in fourth quarter of 2012 from mill at the kumtor mine.

Russia’s central bank decreased its gold reserves by 0.1 million troy ounces in August, taking its total holdings to 30.0 million ounces, the bank said on its website on Thursday.

 

Silver Forecast September 21 12012, Technical Analysis

The silver markets fell initially during the session on Thursday, but found the $34 level supportive yet again. This is the third time this market has tested that level over the last week, and as such it looks like $34 is now going to be supportive in general. Because of this, it looks more and more likely that we are going to see sideways action before a continuation higher. A pullback simply may not be coming and it as long as you are not trading the futures market you may be able to buy in this general vicinity.

It is because of this that we prefer physical silver when possible. However, if we do get a pullback we would be willing to step into the market on signs of support at the various support levels below. We believe this is a “buy only” market, and as such will not sell silver under any circumstances. We especially are interested in the $31 level if we can ever get back down that low, we would buy supportive candles hand over fist.

 

Silver Forecast September 21 12012, Technical Analysis
Silver Forecast September 21 12012, Technical Analysis

Silver Fundamental Analysis September 21, 2012 Forecast

Analysis and Recommendations:

Silver is trading at 34.495 as traders sold off to take profits today, as the USD climbed and the metals pack declined on poor eco data from China and Japan.

Although precious metals remain on the positive side, they began to weaken on positive eco data from the US pushing the greenback higher. Also stimulus around the world is waning and traders are not so sure of the results or when we might see results as global economies are in more trouble then expected.

The EU still needs to deal with its debt crisis even though the ECB has once again gained more time for politicians and leaders to come up with a longer term solution.

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.

Economic Data September 20, 2012 actual v. forecast

Date

 

Currency

 

 

Event

Actual

 

Forecast

 

Previous

 

 

Sep. 20

 

JPY

 

 

Trade Balance 

-0.47T

 

-0.37T 

 

-0.37T 

   

 

 

CNY

 

 

Chinese HSBC Manufacturing PMI 

47.80

 

 

 

47.60 

 

 

 

 

EUR

 

 

French Manufacturing PMI 

42.6

 

46.4 

 

46.0 

 

 

 

 

EUR

 

 

German Manufacturing PMI 

47.3

 

45.3 

 

44.7 

 

 

 

 

EUR

 

 

Manufacturing PMI 

46.0

 

45.4 

 

45.1 

 

 

 

 

GBP

 

 

Retail Sales (MoM) 

-0.2%

 

-0.4% 

 

0.3% 

 

 

 

 

GBP

 

 

Retail Sales (YoY) 

2.7%

 

2.7% 

 

2.3% 

   

 

 

GBP

 

 

CBI Industrial Trends Orders 

-8

 

-15 

 

-21 

 

 

 

 

USD

 

 

Initial Jobless Claims 

382K

 

375K 

 

385K 

   

 

 

USD

 

 

Continuing Jobless Claims 

3272K

 

3300K 

 

3304K 

   

 

 

USD

 

 

Philadelphia Fed Manufacturing Index 

-1.9

 

-4.0 

 

-7.1 

   

 

Upcoming Economic Events that affect the CHF, EUR, GBP and USD

There are no top tier eco data releases due in Europe or the US on the 21st.

Government Bond Auction

Date Time Country 

Sep 21 15:30 Italy  

 

 

Gold Weighs In

Asian equities plunged from its high since May as Japanese exports shrank for three consecutive months. Chinese manufacturing also contracted for the eleventh month in September. This morning Chinese HSBC PMI data showed an ongoing contraction in manufacturing. Going ahead gold is expected to remain under pressure at least until the European session.

Expect the EUR to extend its loss against the dollar as Spanish bad loans are standing at a record high of 9.9% of their outstanding portfolio, rising from the prior high of 9.4%. Moreover, an accelerated capital flight (326billion Euros) from the four nations of Europe (Portugal, Greece, Italy & Spain) have just coincides with 300billion Euros from the international lenders. Such capital erosion has forced these counties to pay more funding cost to retain them (Greece: 7%, Spain: 6.5%, Italy: 6.2%). Besides, the Euro area manufacturing numbers due later today are also likely to point some minimal improvements which are not enough to pull the economic condition.

From the US today we can expect the Philly Fed region’s manufacturing will in negative territory following the drastic weakness in Empire state. Weekly jobless claims may also increase. All these may indicate a comparative weak dollar during the evening hours. Expect gold to stay weak at least through the European hours after which prices may recoil back.

Gold closed nearly flat and traded near its 6-1/2 month high hit in early trade, supported by monetary stimulus from the world’s major central banks despite pressure from heavy selling in crude oil prices.

Gold holdings  of SPDR gold trust, the largest ETF backed by the precious metal, increased to 1,305.4 tons, as on Sept 19. Silver holdings of iShares silver trust, the largest ETF backed by the metal, increased to 9,883.4 tons, as on Sept 19.

Facing record gold prices, buyers of the yellow metal in India are swapping old jewelry for new as they prepare for the country’s festival season.

Concerned over rising gold imports, the Reserve Bank of India today said it is planning to come out with financial products on the lines of gold ETFs to give options to investors to take advantage of price movement in the precious metal.

Sudan opened its first gold refinery on Wednesday as it seeks to improve the quality of its rising gold exports and offset the economic damage inflicted by the loss of most of its oil revenues.

While writing this report silver prices have retreated a bit at the Globex followed from weakness in Japan exports and Chinese manufacturing, Silver would have been more pressurized from the weak Asian equities which have fallen from their highs since May.

Going ahead expect silver to stay weak as the European nations have seen huge capital flights as mentioned above The Chinese PMI data will weigh heavily on industrial metals, which is already pressurizing silver. Expect to see silver decline today.

Silver Forecast September 20, 2012, Technical Analysis

The silver markets have been a screaming buy for about 30 days now. However, over the last couple of sessions we have seen a bit of consolidation just under the $35 level. This makes sense, as it is a “big round of psychological number”, but it’s hard to believe that the bullish run is over.

With the Federal Reserve continued to step on the gas as far as quantitative easing is concerned, there’s no reason to believe that the precious metals won’t continue to do quite well. Needless to say, silver is no exception and the lack of supply is certainly a nice driver of price much higher.

Depending on which way you choose the play silver, can have a big effect on how you enter the market. If you are buying physical silver, averaging down sometimes can be the way to go. Yes, we do look a bit overextended at this point in time, but many physical silver traders are starting to buy into the market slowly. As price drops, they tend to buy more and more silver as they are building larger positions.

On the other hand, you can cut down a bit of the leverag by using the SLV ETF. This ETF features not only silver futures markets, but silver miners, and other companies that are involved in the silver process. It’s a safe way to play a whole plethora of silver related companies.

Futures markets can give you a mega-boost when it comes to the leverage available. However, the silver futures market can be very volatile, and it has a fairly high threshold for entry. CFDs can take care of this as well, but you must be in a country that allows the trading of them.

No matter how you look at it, silver is a screening by at this point in time. Yes, we would like to see a bit of a pullback as it is a bit high at the moment. We think this market eventually gives much higher and eventually even breaks above the $50 level. However, a pullback would be nice as a move has been so strong over the last month. On pullbacks, we are not hesitating at all to start buying.

Silver Forecast September 20, 2012, Technical Analysis
Silver Forecast September 20, 2012, Technical Analysis

Chinese HSBC Manufacturing PMI Disappoints

This morning markets are reacting to lackluster eco data from China. Traders were hoping to see a turnaround in manufacturing in China, with all the stimulus and programs launched by the Chinese government to help get growth back to forecast. HSBC PMI printed this today at 47.80 showing a continued contraction in manufacturing. PMI needs to report above 50 to show expansion. This is now the 11th consecutive monthly report showing contraction.

Markets are expected to react throughout the day on this data; otherwise the day is very light on news and data.

U.S. stocks rose yesterday as investors dipped back into the market after the recent pullback from a rally that lifted the S&P 500 to just shy of five-year highs.

U.S. home resales jumped 7.8 percent in August, the fastest in more than two years. Housing starts also rose, a hopeful sign that a budding housing market recovery is gaining traction.

New-home construction in the US probably rose in August to the highest level in almost four years; showing residential real estate is sustaining a recovery even as the broader economy sputters. Builders broke ground on 767,000 houses at an annual rate, up from 746,000 in July and the most since October 2008.

The reports came as investors looked for improving economic data to help bolster a rally of 5.9 percent in the S&P 500 since the start of August.

Richmond Federal Reserve President Jeffrey Lacker said the shock from the credit crisis may impede efforts by the central bank to quickly bring down unemployment even with the use of record stimulus. Monetary policy is simply unable to offset all of the ways in which various frictions impede the economy’s adjustment to various shocks.

European stocks climbed, halting a two-day decline, after the Bank of Japan joined the Federal Reserve in opting for further asset purchases to support the economy.

German Chancellor Angela Merkel and French President Francois Hollande, already trying to save Europe’s single currency, are being thrust into another joint project: building a cross-border aerospace company.

Japanese stocks rose on Wednesday, sending the Nikkei 225 Stock Average to the highest close since May 2, after the Bank of Japan unexpectedly expanded its easing program to keep the rising yen from undermining a recovery, following stimulus measures from the US Federal Reserve last week.

Australia’s AAA credit grade was affirmed by Standard & Poor’s Ratings Services, which cited the country’s stability, policy flexibility and economic resilience. The nation has the ability to absorb large economic and financial shocks, although its strengths are moderated by a dependence on resources exports.

Gold fell by 0.23% after US Federal Reserve’s last meeting showed  up the Fed. Reserve is reluctant to brief up the economy with a USD40 bn/month bond buying programme. Gold’s rise after the stimuli is the longest such streak since June. Silver also fell by 0.28% but remained on high parameters.

Oil declined by  0.30%  near the lowest close in more than six weeks in New York after stockpiles rose the most since March in the U.S., the world’s biggest crude user.

Copper fell by 0.09% and traded near the lowest on hopes that Chinese Government will initiate some relief stimulus to provide some force to the Chinese economy in the near-term, but impact seems little

Silver Fundamental Analysis September 20, 2012, Forecast

Analysis and Recommendations:

Silver dipped a bit today, to trade at 34.613 on the backs of profit taking. Precious metals remained strong today and industrial metals traded positively today after the BoJ introduced additional stimulus.

The Bank of Japan joined the crowd of central banks further easing their monetary policies, as the BOJ Wednesday announced an aggressive monetary stimulus program amid what it says is a global economic slowdown.  The BOJ move provided a boost to many raw commodity markets today, including the precious metals

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 up to the data analysis and information in our weekly reports.

Economic Data September 19, 2012 actual v. forecast

Date

 

Currency

 

 

Event

Actual

 

Forecast

 

Previous

 

 

Sep. 19

 

JPY

 

 

Interest Rate Decision 

0.10%

 

0.10% 

 

0.10% 

 

 

 

 

USD

 

 

Building Permits 

0.803M

 

0.796M 

 

0.811M 

 

 

 

 

USD

 

 

Housing Starts 

0.750M

 

0.765M 

 

0.733M 

   

 

Upcoming Economic Events that affect the CHF, EUR, GBP and USD

Date

Time

Currency

Event

Forecast

Previous

Sep. 20 

07:58

EUR

French Manufacturing PMI 

46.4 

46.0 

 

08:28

EUR

German Manufacturing PMI 

45.3 

44.7 

 

09:30

GBP

Retail Sales (MoM) 

-0.4% 

0.3% 

 

09:30

GBP

Retail Sales (YoY) 

2.7% 

2.8% 

 

11:00

GBP

CBI Industrial Trends Orders 

-15 

-21 

Government Bond Auction

Date Time Country 

Sep 20 08:30 Spain 

Sep 20 08:50 France 

Sep 20 09:30 UK 

Sep 20 09:50 France 

Sep 20 15:00 US 

Sep 20 17:00 US 

Sep 21 15:30 Italy  

Silver Forecast September 19, 2012, Technical Analysis

The silver markets rose again during the Tuesday session as the $34 level offered support. If we have any opinion on silver, it is that it is going much, much higher. Nonetheless, buying at this level is a bit tricky as it is overextended at the moment. We still see the $34, $33, $31, and most certainly the $30 level as potential support points. We would love to see the market pullback in order to buy silver at cheaper price.

We are long of the silver market in various ways currently and think that this is a “buy only market.” There’s absolutely no way that we would consider shorting the silver markets, and every time this market dips, we are more than willing to pick it up. We are long of silver via ETFs, physical silver rounds, and even futures markets. We see absolutely no reason to think that silver won’t continue to climb in this current environment.

With stimulus and quantitative easing, central banks essentially will flood the market with money creating a nice drive for people to own hard assets. Silver and gold are both considered to be hard assets and “true money.” On top of that driver is the fact that the US dollar will continue to weaken as long as the Federal Reserve prints currency, so this of course makes silver naturally rise over time.

Included in the bullish sentiment on silver is the fact that stimulus will often cause massive building project. Don’t ever forget, silver does have an industrial application that is certainly a large part of its price action.  In a situation where we have both Fiat currency depreciation and industrial expansion due to stimulus, silver turns out to be a winner in both algorithms.

We do think the market is a little overbought at this point, and as such are expecting a bit of a pullback. As long as we stay above the $30 level however, we see absolutely no weakness in this market. Every time this market falls, you should be thinking “How can I buy more silver as price drops?”

Silver Forecast September 19, 2012, Technical Analysis
Silver Forecast September 19, 2012, Technical Analysis

Silver Fundamental Analysis September 19, 2012, Forecast

Silver futures made another attempt to breakout to the upside, but failed to attract fresh buying on the move. This could be a sign that sentiment is shifting especially if the market ends up closing lower. Falling demand for higher-risk assets is the fundamental force that could trigger a short-term decline while overbought technical factors could also lean on prices.

Now that the Fed has given silver speculators what they had been anticipating for months – additional stimulus – traders are going to be looking for reasons to drive silver prices higher. A weaker U.S. Dollar seems to be the only true fundamental factor left to which silver traders can react. On Wednesday, this should be the leading indicator for silver traders.

A weaker dollar should underpin the market. Renewed demand for risk should drive the dollar lower and silver higher.  Better than expected U.S. housing reports, or renewed sovereign debt issues in the Euro Zone are likely to drive the dollar higher, thereby pressuring silver prices. 

Silver Forecast September 18, 2012, Technical Analysis

The silver markets fell during the Monday session as the rally took a small break during the Monday session. We currently see the $33 level as support, as well as the $31 and $30 level. We think that this market is just in the beginning of a massive bull run, and new highs will more than likely be seen in the relatively short order. We think that as is market pulls back, it will simply be another buying opportunity presenting itself. There is far too much quantitative easing out there to even consider selling the precious metals right now, and we actually preferred to buy physical silver if we get the opportunity.

You can use the SLV ETF as well. It moves based upon the price of silver and various silver related companies such as miners. This is a good way to get general exposure to silver as a whole, but it is and as pure of a play as the futures contracts would be. As for us, we have been using a combination of all three, but have been especially interested in physical silver as it becomes a long-term investment. After all, it wasn’t that long ago that silver was somewhere near three dollars an ounce.

As the world continues to prime their economies through quantitative easing, there could be no doubt that precious metals in hard assets such as silver, gold, oil, and copper will all benefit in the long run. This is simply the supply and demand issue as a virtually unlimited amount of dollars can be pretty, but you cannot make silver.

Another interesting point about silver is that 90% of all silver ever mind is being used already. This means that there is a continual shortfall of supply in this market, and after all that is the biggest factor in the price of anything: availability. Silver is used in industrial and precious metals situations, and as such we think it is the best of both worlds. In a lot of ways, it’s like owning copper and gold at the same time.

 

Silver Forecast September 18, 2012, Technical Analysis
Silver Forecast September 18, 2012, Technical Analysis

Silver Fundmental Analysis September 18, 2012, Forecast

December Silver could see some selling pressure as speculators, driven by the fresh stimulus from the Fed, may decide to pare positions and play for a more favorable price for re-entry. Silver was trading flat on Monday as the market took a breather after the metal reached its highest level in six-months.

The chart pattern and the aggressive stimulus plan proposed by the Fed are two major reasons to believe this market has room to the upside, but only if prices weaken enough to attract fresh buying. Demand for silver and gold is also increasing in India and China which leads one to believe that this market will be supported on any weakness.

A stronger Dollar due to oversold conditions could trigger a sell-off in silver on Tuesday. Traders should watch silver’s relationship with the dollar closely as this correlation is likely to be most beneficial for direction.

Increased tensions in the Middle East as well as uncertainty over the conflict between China and Japan could underpin the market on any weakness. 

Monthly Nearby Silver Nearing Breakout Level

With September more than half over, it’s time to take a look at the silver market since it is one of the markets on the move this month.

Last month, the Nearby Silver market broke through the resistance line of a triangle chart pattern on the monthly chart. In August, the resistance line was at $30.27 so the close at $31.44 was impressive. Since the market had been in such a severe down trend, the most important part of this chart pattern is the follow-through rally.

Monthly Nearby Silver Nearing Breakout Level
Monthly Nearby Silver Nearing Breakout Level

Monthly Nearby Silver Pattern, Price & Time Analysis

With the short-term range $37.78 to $26.20, a key retracement zone was created at $31.99 to $33.35. This area could have become a resistance zone, but strong follow-through momentum triggered a breakout through the retracement zone, putting the market in a position to challenge the February top at $37.78. This zone is now new support.

Besides the clearly formed triangle chart pattern, traders should also notice the developing double-bottom chart pattern. The two bottoms of the formation are $26.41 and $26.20. A breakout over $37.78 will not only turn the main trend up on the swing chart, but it will also confirm the double-bottom. If you take the difference between $37.78 and $26.20 and add it to $37.78, the projected upside target based on this chart pattern is $49.36. ($37.78 – $26.20 = $11.58. Add $11.58 to $37.78 to get $49.36).A move to this this level will put it slightly below the April 2011 top at $50.28.

Using previous rallies as our guide, traders should not expect a fast rally into this level. The course it is expected to take should be steady at least until it clears the retracement zone created by the $50.28 to $26.20 range at $38.24 to $41.08. In 2011, following a steady rally, the silver market went vertical as it passed through this same price area. I’m not saying this could happen again, but just referring to the past. Slow and steady may lead to higher prices over the long-run whereas vertical moves may spell the end to the run. Only time will tell if speculators have learned any lessons from the past.

Silver forecast for the week of September 17, 2012, Technical Analysis

The silver markets rallied during the week as the Federal Reserve announced further quantitative easing. The end of the week we formed a hammer and this is sitting just below the $35 resistance level. This looks very bullish, and as long as we can break above the $35 level on a daily close we believe that this market does much higher. If we break the bottom of the scandal however, that would make it a “hanging man”, which of course is a very bearish sign. Currently we believe that the $35 level tells the whole story, and as such are waiting to see what the market does at this level.

 

Silver forecast for the week of September 17, 2012, Technical Analysis
Silver forecast for the week of September 17, 2012, Technical Analysis

Silver Forecast September 17, 2012, Technical Analysis

The silver markets did very little during the session on Friday, as traders took a pause after the smashing Thursday session. The move over the last couple weeks has been rather impressive, and we now find ourselves testing the $35 level. This is a significant area on the longer-term charts, but it is more than likely going to be overcome before it’s all said and done.

A pullback would be very likely at this point and probably well welcomed by most traders. We see the $31 level as a significant support area, but could see support come back into the market as high as $33. Because of this, we are waiting for a pullback and a supportive candles from which to buying this market, or a daily close well above the $35 level.

 

Silver Forecast September 17, 2012, Technical Analysis
Silver Forecast September 17, 2012, Technical Analysis

Silver Weekly Fundamental Analysis September 17-21, 2012, Forecast

Introduction: Silver futures are standardized, exchange-traded contracts in which the contract buyer agrees to take delivery, from the seller, a specific quantity of silver (eg. 30000 grams) at a predetermined price on a future delivery date.

Some Facts about Silver

Silver is a soft, shiny and heavy metallic element with a brilliant white luster. A very ductile and malleable metal, its thermal and electrical conductivity is the highest of all known metals.

Besides being used as a store of value, other main uses of silver include applications in areas such as electronics, photography and as antiseptics.

Consumers and producers of silver can manage silver price risk by purchasing and selling silver futures. Silver producers can employ a short hedge to lock in a selling price for the silver they produce while businesses that require silver can utilize a long hedge to secure a purchase price for the commodity they need.

Silver futures are also traded by speculators who assume the price risk that hedgers try to avoid in return for a chance to profit from favorable silver price movement. Speculators buy silver futures when they believe that silver prices will go up. Conversely, they will sell silver futures when they think that silver prices will fall.

Weekly Analysis and Recommendations:

Silver is trading at 34.65 off the high of the day of 34.98 as industrial metals and precious metals soared most of the week, but more on announcement from the FOMC of a complete and comprehensive program of stimulus. Much more than markets had expected.

Date

Last

Open

High

Low

Change %

Sep 14, 2012

34.695

34.618

34.980

34.343

0.22%

Sep 13, 2012

34.620

33.285

34.860

32.725

4.02%

Sep 12, 2012

33.283

33.563

34.138

32.523

-0.84%

Sep 11, 2012

33.565

33.500

33.863

33.398

0.19%

Sep 10, 2012

33.503

33.693

34.008

33.290

-0.56%

The release of the plans gave a huge bump to precious metals as a hedge against inflation but also lowered the USD making the purchases more attractive to foreign buyers. But also industrial metals bumped up on hopes of increased demand for manufacturing and productions. With the new BMS program introduced, housing and construction should soar which is supportive of the metals pack.

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 September 10-14, 2012 actual v. forecast for Euro, GPB, the Franc, and USD

Date

Time

Currency

Event

Actual

Forecast

Previous

Sep. 11

00:01

GBP

RICS House Price Balance 

-19%

-22% 

-23% 

 

06:30

EUR

French Non-Farm Payrolls (QoQ) 

-0.1%

-0.1% 

-0.1% 

 

09:30

GBP

Trade Balance 

-7.2B

-9.0B 

-10.1B 

 

13:30

USD

Trade Balance 

-42.0B

-44.0B 

-41.9B 

 Sep. 12

06:30

EUR

French CPI (MoM) 

0.7%

0.5% 

-0.4% 

 

07:00

EUR

German CPI (MoM) 

0.4%

0.3% 

0.3% 

 

07:00

EUR

German CPI (YoY) 

2.1%

2.0% 

2.0% 

 

09:30

GBP

Average Earnings Index +Bonus 

1.5%

1.6% 

1.8% 

 

09:30

GBP

Claimant Count Change 

-15.0K

0.5K 

-13.6K 

 

10:00

EUR

Industrial Production (MoM) 

0.6%

-0.1% 

-0.6% 

 

13:30

USD

Import Price Index (MoM) 

0.7%

1.4% 

-0.7% 

 

18:00

USD

10-Year Note Auction 

1.764%

 

1.680% 

 Sep. 13

08:15

CHF

PPI (MoM) 

0.5%

-0.4% 

-0.3% 

 

08:30

CHF

Interest Rate Decision 

0.00%

0.00% 

0.00% 

 

13:30

USD

Core PPI (MoM) 

0.2%

0.2% 

0.4% 

 

13:30

USD

PPI (MoM) 

1.7%

1.1% 

0.3% 

 

13:30

USD

Initial Jobless Claims 

382K

370K 

367K 

 

13:30

USD

Continuing Jobless Claims 

3283K

3318K 

3332K 

 

13:30

USD

PPI (YoY) 

2.0%

1.4% 

0.5% 

 

13:30

USD

Core PPI (YoY) 

2.5%

2.6% 

2.5% 

 

17:30

USD

Interest Rate Decision 

0.25%

0.25% 

0.25% 

 

19:00

USD

Federal Budget Balance 

-191.0B

-155.0B 

-69.6B 

Sep. 14

10:00

EUR

CPI (YoY) 

2.6%

2.6% 

2.6% 

 

10:00

EUR

Employment Change (QoQ) 

0.0%

-0.2% 

-0.2% 

 

10:00

EUR

Core CPI (YoY) 

1.5%

1.7% 

1.7% 

 

13:30

USD

Core CPI (MoM) 

0.1%

0.2% 

0.1% 

 

13:30

USD

Core Retail Sales (MoM) 

0.8%

0.6% 

0.8% 

 

13:30

USD

CPI (MoM) 

0.6%

0.5% 

0.0% 

 

13:30

USD

Retail Sales (MoM) 

0.9%

0.7% 

0.6% 

 

13:30

USD

CPI (YoY) 

1.7%

1.7% 

1.4% 

 

13:30

USD

Core CPI (YoY) 

1.9%

2.0% 

2.1% 

 

14:15

USD

Industrial Production (MoM) 

-1.2%

0.2% 

0.5% 

 

14:55

USD

Michigan Consumer Sentiment 

79.2

74.0 

74.3 

Historical: From 2010 to present

Highest: 49.813 on Apr 25, 2011

Average: 28.468 over this period.

Lowest: 14.655 on Feb 05, 2010

 

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

Date

Time

Currency

Event

Forecast

Previous

 Sep. 17

13:30

USD

NY Empire State Manufacturing Index 

-2.0 

-5.8 

Sep. 18

09:30

GBP

CPI (YoY) 

2.5% 

2.6% 

 

09:30

GBP

CPI (MoM) 

0.5% 

0.1% 

 

10:00

EUR

German ZEW Economic Sentiment 

-19.0 

-25.5 

 

13:30

USD

Current Account 

-126.0B 

-137.3B 

 

14:00

USD

TIC Net Long-Term Transactions 

 

9.3B 

Sep. 19 

13:30

USD

Building Permits 

0.800M 

0.811M 

 

13:30

USD

Housing Starts 

0.765M 

0.746M 

 

15:00

USD

Existing Home Sales 

4.56M 

4.47M 

Sep. 20 

07:58

EUR

French Manufacturing PMI 

46.4 

46.0 

 

08:28

EUR

German Manufacturing PMI 

45.3 

44.7 

 

09:30

GBP

Retail Sales (MoM) 

-0.4% 

0.3% 

 

09:30

GBP

Retail Sales (YoY) 

2.7% 

2.8% 

 

11:00

GBP

CBI Industrial Trends Orders 

-15 

-21 

Government Bond Auction

Date Time Country 

Sep 17 09:10 Slovakia

Sep 17 10:00 Norway 

Sep 18 08:30 Spain 

Sep 18 09:10 Greece 

Sep 18 09:30 Belgium 

Sep 19 09:10 Sweden 

Sep 19 09:30 Germany 

Sep 19 09:30 Portugal 

Sep 19 10:00 Norway 

Sep 20 08:30 Spain 

Sep 20 08:50 France 

Sep 20 09:30 UK 

Sep 20 09:50 France 

Sep 20 15:00 US 

Sep 20 17:00 US 

Sep 21 15:30 Italy  

 

Silver Fundamental Analysis September 17, 2012, Forecast

Analysis and Recommendations:

Silver is trading at 34.675 down a few cents today, as investors took profits after silver soared to recent highs on the FOMC news.

Silver was able to capitalize on the possibility of inflation stemming from the injection of money from the Feds, which pushed the precious metal upwards. Also the increase in manufacturing and production will add demand to the metals pack, which traded strongly today, giving silver the double whammy. Markets will now focus on China, where the Premier says he will do whatever it takes to meet his 2012 forecasts including monetary stimulus and programs.

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 up to the data analysis and information in our weekly reports.

Economic Data September 14, 2012 actual v. forecast

Date

 

Currency

 

 

Event

Actual

 

Forecast

 

Previous

Sep. 14

 

JPY

 

 

Industrial Production (MoM) 

-1.0%

 

-1.2% 

 

-1.2% 

 

 

EUR

 

 

CPI (YoY) 

2.6%

 

2.6% 

 

2.6% 

 

 

EUR

 

 

Employment Change (QoQ) 

0.0%

 

-0.2% 

 

-0.2% 

 

 

EUR

 

 

Core CPI (YoY) 

1.5%

 

1.7% 

 

1.7% 

 

 

USD

 

 

Core CPI (MoM) 

0.1%

 

0.2% 

 

0.1% 

 

 

USD

 

 

Core Retail Sales (MoM) 

0.8%

 

0.6% 

 

0.8% 

 

 

USD

 

 

CPI (MoM) 

0.6%

 

0.5% 

 

0.0% 

 

 

CAD

 

 

Manufacturing Sales (MoM) 

-1.50%

 

1.00% 

 

-0.80% 

 

 

USD

 

 

Retail Sales (MoM) 

0.9%

 

0.7% 

 

0.6% 

 

 

USD

 

 

CPI (YoY) 

1.7%

 

1.7% 

 

1.4% 

 

 

USD

 

 

Core CPI (YoY) 

1.9%

 

2.0% 

 

2.1% 

 

Upcoming Economic Events that affect the CHF, EUR, GBP and USD

Date

Time

Currency

 

Event

 

Forecast

Previous

Sep. 18

09:30

GBP

 

CPI (YoY) 

 

 

2.6% 

 

09:30

GBP

 

CPI (MoM) 

 

 

0.1% 

 

10:00

EUR

 

German ZEW Economic Sentiment 

 

-25.5 

-25.5 

Government Bond Auction

Date Time Country 

Sep 17 09:10 Slovakia

Sep 17 10:00 Norway 

Sep 18 08:30 Spain 

Sep 18 09:10 Greece 

Sep 18 09:30 Belgium 

Sep 19 09:10 Sweden 

Sep 19 09:30 Germany 

Sep 19 09:30 Portugal 

Sep 19 10:00 Norway

Silver Forecast September 14, 2012, Technical Analysis

The silver markets skyrocketed during Thursday after the Federal Reserve announced a stronger than anticipated monetary easing policy. With the US dollar set to decline further, there is no reasonable case for silver to fall for any length of time. Because of this we are buying dips as we continue much higher. It should be stated however, that the market has rallied significantly over the last couple of weeks, and a pullback could be coming.

A pullback that shows up is quite frankly an invitation to buy silver at cheaper prices. We believe in buying the SLV ETF, physical silver and silver futures depending on what your financial situation is. In fact, we believe in a mixture of all three if possible. As for selling silver, we simply see no reason to do it until we get well below the $25 level which looks very unlikely at this point.

 

Silver Forecast September 14, 2012, Technical Analysis
Silver Forecast September 14, 2012, Technical Analysis