Silver Forecast June 28, 2012, Technical Analysis

The silver markets had a very quiet session on Wednesday as the trading community sits patiently and waits for the results of the European Union meetings over the next two days. The silver markets are going to be influenced by not only the risk appetite, but the industrial demand as well. It is highly likely that the summit will produce very little in terms of substance. Because of this, it’s difficult to see the “risk on” trade coming back into vogue. With this being said, it looks like we will continue to grind sideways in the meantime. If the dollar does start to appreciate rapidly, this will be a catalyst for silver to lose value rapidly as well. Quite frankly, the next move in this market is probably going to be a reaction to that summit. With this being said, it is very difficult to take on a position at this moment in time.

Silver Forecast June 28, 2012, Technical Analysis
Silver Forecast June 28, 2012, Technical Analysis

Silver Fundamental Analysis June 28, 2012, Forecast

Analysis and Recommendations:

Silver is down following on the heels of gold trading at 26.828. The metals pack including precious and industrial metals were down in today’s session with the exception of copper, which after a huge fall earlier in the week was able to hold pretty close to even.

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 Releases for June 26, 2012 actual v. forecast

Date

 

Currency

 

 

 

Event

Actual

 

Forecast

 

Previous

 

 

Jun. 27

 

EUR

 

 

 

German Import Price Index (MoM) 

-0.7%

 

-0.7% 

 

-0.5% 

 

 

 

 

EUR

 

 

 

Spanish Retail Sales (YoY) 

-4.9%

 

-8.2% 

 

-10.0% 

   

 

 

EUR

 

 

 

Italian Business Confidence 

88.9

 

85.5 

 

86.6 

   

 

 

NOK

 

 

 

Norwegian Unemployment Rate 

3.00%

 

3.00% 

 

3.00% 

 

 

 

 

GBP

 

 

 

BBA Mortgage Approvals 

30.2K

 

32.8K 

 

32.1K 

   

 

 

EUR

 

 

 

Italian 6-Month BOT Auction 

2.957%

 

 

 

2.104% 

 

 

 

 

GBP

 

 

 

CBI Distributive Trades Survey 

42

 

10 

 

21 

 

 

 

 

USD

 

 

 

MBA Mortgage Applications

-7.1%

 

 

 

-0.8% 

 

 

 

 

EUR

 

 

 

German CPI (MoM) 

-0.1%

 

0.0% 

 

-0.2% 

 

 

 

 

EUR

 

 

 

German CPI (YoY) 

1.7%

 

1.8% 

 

1.9% 

 

 

 

 

USD

 

 

 

Core Durable Goods Orders (MoM) 

0.4%

 

0.7% 

 

-0.6% 

   

 

 

USD

 

 

 

Durable Goods Orders (MoM) 

1.1%

 

0.4% 

 

-0.2% 

   
                               

 

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

Date

Time

Currency

 Event

Previous

Jun 28

7:55

EUR

German Unemployment Change

0K

8:30

GBP

Current Account

-8.5B

8:30

GBP

BOE Credit Conditions Survey

 

8:30

GBP

Final GDP q/q

-0.3%

12:30

USD

Unemployment Claims

 

12:30

USD

Final GDP q/q

1.9%

23:01

GBP

GfK Consumer Confidence

-29

Jun 29

29th-4th

EUR

German Retail Sales m/m

0.6%

6:45

EUR

French Consumer Spending m/m

0.6%

7:00

CHF

KOF Economic Barometer

0.81

8:00

EUR

M3 Money Supply y/y

2.5%

9:00

EUR

CPI Flash Estimate y/y

2.4%

12:30

USD

Core PCE Price Index m/m

0.1%

12:30

USD

Personal Spending m/m

0.3%

13:45

USD

Chicago PMI

52.7

13:55

USD

Revised UoM Consumer Sentiment

74.1

Upcoming Government Bond Auctions

Date Time Country 

Jun 28  09:10  Italy

Jun 28  17:00  US

Silver Forecast June 27, 2012, Technical Analysis

The silver markets continued their lackluster performance on Tuesday as the trading world looks ahead to the European Union’s summit on Thursday and Friday. While the traders around the world were willing to give the Europeans the benefit of the doubt over the last couple of years, it looks as if now patience is starting to run out. Unlike many of the other weeks before a summit, we are not seeing a “risk on” attitude as the markets try to get ahead of any positive news coming from Europe.

With this in mind, it is of no surprise that the silver markets would lag. The $27 level is the beginning of serious support, so we do think that while the trend is down there will be a bit of a fight. From our calculations, the $25 level is the very end of anything supportive in this market for the foreseeable future. With the trend being so heavily to the downside, we certainly have no interest in buying this market at this moment in time.

Recently, we have seen a consolidation between $27 and the $30 mark. This level has been pretty constrictive, and even with the slight break lower – we still feel that the support is fairly strong. However, we still agree with the idea of selling silver and as such will look to fade rallies when they appear. This makes sense, as the silver markets also have to facilitate the industrial demand part of the equation as silver is every bit the industrial metal as it is the precious metal. It is because of that that the gold market will more than likely offer a better return over the long term if the metals do get a bid.

We are selling short term resistive candles, and rallies that show weakness on the same charts. Perhaps on the four-hour or even one hour charts we will find our signals. We simply cannot buy silver at this point in time, or at least until it clears $30 mark on a daily close. We will continue to trade this market short-term, and on the downside.

Silver Forecast June 27, 2012, Technical Analysis
Silver Forecast June 27, 2012, Technical Analysis

Silver Fundamental Analysis June 27, 2012, Forecast

Analysis and Recommendations:

Silver declined slightly today, to trade at 27.265 following global markets and worldwide commodities. With the US adding strength, this puts limits on dollar denominated commodities. As manufacturing slumps, so does the demand for industrial metals.

Gold declined also today to trade at 1577.85

Most of the global focus is on news flow from the EU. There is little in the way of eco data on the first or second tier level.

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.

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

Date

Time

Currency

 Event

Previous

Jun 27

All Day

EUR

German Prelim CPI m/m

-0.2%

8:30

GBP

BBA Mortgage Approvals

32.4K

10:00

GBP

CBI Realized Sales

21

12:30

USD

Durable Goods Orders m/m

0.2%

14:00

USD

Pending Home Sales m/m

-5.5%

14:30

USD

Crude Oil Inventories

 

Jun 28

7:55

EUR

German Unemployment Change

0K

8:30

GBP

Current Account

-8.5B

8:30

GBP

BOE Credit Conditions Survey

 

8:30

GBP

Final GDP q/q

-0.3%

12:30

USD

Unemployment Claims

 

12:30

USD

Final GDP q/q

1.9%

23:01

GBP

GfK Consumer Confidence

-29

Jun 29

29th-4th

EUR

German Retail Sales m/m

0.6%

6:45

EUR

French Consumer Spending m/m

0.6%

7:00

CHF

KOF Economic Barometer

0.81

8:00

EUR

M3 Money Supply y/y

2.5%

9:00

EUR

CPI Flash Estimate y/y

2.4%

12:30

USD

Core PCE Price Index m/m

0.1%

12:30

USD

Personal Spending m/m

0.3%

13:45

USD

Chicago PMI

52.7

13:55

USD

Revised UoM Consumer Sentiment

74.1

 

Silver Forecast June 26, 2012, Technical Analysis

The silver markets had a strong positive day on Monday as the $27 level acted as support yet again. This last fall was a bit lower than the one before it, so it still suggests that market wants to fall in the end. However, it now looks as if we are heading back into consolidation between the $27 and $30 levels, and as a result we think that the whole area could provide some kind of resistance going forward. Certainly, we need to see quantitative easing out of several central banks to move the price of silver higher in the long run – but this is something that is very possible in the future. In the mean time though – we prefer to sell if we get the right weak candle to do so from. We think that the market should simply head back into the grind it was in the last couple of weeks.

Silver Forecast June 26, 2012, Technical Analysis
Silver Forecast June 26, 2012, Technical Analysis

Silver Fundamental Analysis June 26, 2012, Forecast

Analysis and Recommendations:

Silver climbed in today’s session as most of the metal pack and the precious metals did. Silver is trading at 26.758 adding 0.034.

The strength of the Dollar Index limited the rise in silver, when the dollar is strong it makes purchasing the dollar based commodity high.

Silver followed gold today, as it bounced up and down between gains and losses holding fairly close to its open. Gold is currently up 5.85 trading at 1572.55.

There was little in the way of eco data and the news flow was as expected, the EU summit, Greece, Spain and Italy, along with bickering between Germany and the EU.

There should be little action here for the next day or so.

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.

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

Date

Time

Currency

 Event

Previous

Jun 26

8:30

GBP

Public Sector Net Borrowing

-18.8B

13:00

USD

S&P/CS Composite-20 HPI y/y

-2.6%

14:00

USD

CB Consumer Confidence

64.9

Jun 27

All Day

EUR

German Prelim CPI m/m

-0.2%

8:30

GBP

BBA Mortgage Approvals

32.4K

10:00

GBP

CBI Realized Sales

21

12:30

USD

Durable Goods Orders m/m

0.2%

14:00

USD

Pending Home Sales m/m

-5.5%

14:30

USD

Crude Oil Inventories

 

Jun 28

7:55

EUR

German Unemployment Change

0K

8:30

GBP

Current Account

-8.5B

8:30

GBP

BOE Credit Conditions Survey

 

8:30

GBP

Final GDP q/q

-0.3%

12:30

USD

Unemployment Claims

 

12:30

USD

Final GDP q/q

1.9%

23:01

GBP

GfK Consumer Confidence

-29

Jun 29

29th-4th

EUR

German Retail Sales m/m

0.6%

6:45

EUR

French Consumer Spending m/m

0.6%

7:00

CHF

KOF Economic Barometer

0.81

8:00

EUR

M3 Money Supply y/y

2.5%

9:00

EUR

CPI Flash Estimate y/y

2.4%

12:30

USD

Core PCE Price Index m/m

0.1%

12:30

USD

Personal Spending m/m

0.3%

13:45

USD

Chicago PMI

52.7

13:55

USD

Revised UoM Consumer Sentiment

74.1

Gold and Silver Update June 25, 2012

The BRIC (Brazil, Russia, India and China) nations announced today, an effort to stave off global financial turmoil are considering forming a foreign exchange reserve pool and swap arrangement-supporting gains in base metals. On similar note, China and Brazil announced a $30 billion currency exchange, a step toward a broader agreement among emerging markets to pool resources as a firewall against growing uncertainties.

Asian equities are trading down by nearly half percent as the European Central Bank announced it would further ease rules on the collateral banks can use in order to secure central-bank funding. The ECB move came with Spain due to formally request aid for its banking sector today, and ahead of this week’s crucial two-day European Union leaders summit, due to start Thursday. Ahead of the summit, reports over the weekend indicated that Greece delegation may present austerity and budget cut plans and may further support down side of base metals due to growing pessimism. In a surprise announcement on the Greek Prime Minister and Finance Minister stated that they were ill and unable to attend the meetings

The euro is trading down and is expected to remain weak in today’s session.

From the economic data front, the US manufacturing releases in the form of Chicago and Dallas may continue to remain weak due to weak demand while the New home sales may increase slightly compared to last month and may further support downside of metals pack.

Gold futures prices advanced near half a percent in early trading while the Asian shares plunged. Although the US equities rose last Friday amid ECB’s loosening rule for banking collaterals, the decision would be fatal for the euro as they were ready to buy the junk rated bonds. However, Germany is strictly opposing the matter as that would raise the tax burden on their investors. The market will therefore be watching the implementation of common Euro bonds and financial transaction tax. Both of these would be a negative factor for the shared currency. The same would have been reflected on a weakening euro at present moment. Therefore expect the early gains in gold would be pared of during the European hours. However, during the US session, reports are expected to highlight the poor manufacturing sector while new home sales are also likely to come down after the mortgage applications fell drastically and cheaper house price index would have demoralized the contractors to start up the projects. This would therefore be a supportive factor for gold prices.

Silver futures prices are also trading at a higher note. During the US session the manufacturing data and housing numbers could be weak which may create pressure on silver as silver falls both in the industrial metals groups as well as the precious metals category so it could be a double whammy.

The Silver “Short it” Hype and Explosion

The Silver “Short it” Hype and Explosion
The Silver “Short it” Hype and Explosion

The Spot Silver Last Closed itself at price of USD26.76 per ounce. Last year right around December 30 2011, it bottomed $26 before peaking around $37 dollars on 29 February  and then see it downtrend again till the last closed price. Attached is the 3x Long Silver ETN Velocity  (USLV.US) shares that derive its value from CMX Silver Future September 2012. The 35 weeks correlation value of 0.92 is extremely positive with spot silver direction. The 3x USLV.US  volume circled around 21 February was the week before Spot silver topped  and the following week we see a surge in volume traded as high as 5.5 million a 3 fold increase in volume which sparked the downtrend. Last week when Spot silver closed at the price, volume traded for USLV.US is as high as 6.5million the highest recorded for the share.

This record volume traded may point Spot silver price to head further down but to where?

The region between $14-$20 is a point where market consolidated around that range for almost 2 years before surging up on a bull market back in 2011. This could be a potential area to head to as people jump into the “short it” hype believing that world manufacturing has faltered along with growth worldwide.

Silver Forecast June 25, 2012, Technical Analysis

The silver markets barely move during the Friday session as traders seemed unwilling to take a new position on before the weekend. The range was very tight, and as such there really is nothing to be seen as a signal from the session. However, we did break down below the $27 mark which was an area we had been watching for some time. It does look like we broken through the consolidation area that has been giving so much support to this market. With this in mind, we are willing to sell breakdowns as they come. We also would be more than willing to sell any rallies that shown signs of weakness on the shorter time frames.

The silver markets have been very weak for quite some time. Most of the spring and summer has been a steady decline in the value of this market. This is predicated upon a stronger than usual dollar, and the fact that the industrial part of the equation has been very weak for the store commodity in general. Unlike gold, silver can act as an industrial metal instead of a precious metal at times. We believe this is what has been going on for some time now as the world is concerned about global growth. It’s a simple concept, the lower the amount of industrial output, the lower the demand for silver – all things being equal.

Technically speaking, this pair is in an extreme downtrend and we have just broken through what should be a continuation pattern. The breaking down of the $27 level will have ran some stops, and have many other people thinking of shorting as well Erie it because of this, we feel that silver is only a headline or two away from falling even further.

While it is almost impossible to glean any kind of signal from the tepid Friday action, the simple truth is that silver has been a one-way bet since the end of February. Is absolutely no reason to buy silver at this point in time, and as such we are selling fresh lows and rallies to show weakness.

Silver Forecast June 25, 2012, Technical Analysis
Silver Forecast June 25, 2012, Technical Analysis

Silver Forecast for the Week of June 25, 2012, Technical

The silver markets had a very disappointing week for the buy side as the market sold off rather aggressively. However, we are sitting just above a massive support zone. On the daily charts, you can clearly see that $27 is a level where support starts. However, the support really doesn’t end until we break below the $25 mark. Because of this, we are waiting for that to happen in order to sell. There is absolutely nothing on this long-term chart that suggests we should be buying at this point. It is because of this that we are in a “sell only” mode at the moment.

Silver Forecast for the Week of June 25, 2012, Technical
Silver Forecast for the Week of June 25, 2012, Technical

Silver Weekly Fundamental Analysis June 25-29, 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 ended the week at 26.837 after bouncing below the 27.00 price range. Rising fears about global growth, tumbling commodity prices and a sharp pull-back from risky markets means that commodity and emerging market currencies are now coming under the pressure. Silver falls into two categories, that of industrial metal and precious metal. With the slowdown in manufacturing and production the industrial demand for silver is reduced and with risk aversion and markets supporting the USD, there is little support for the metals group.

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 19-23, 2012 actual v. forecast

Date

Time

 

Currency

 

Importance

 

Event

Actual

 

Forecast

 

Previous

 

 

Jun. 19

02:30

 

AUD

 

 

 

Monetary Policy Meeting Minutes 

 

 

 

 

 

 

 

 

10:00

 

EUR

 

 

 

German ZEW Economic Sentiment 

-16.9

 

4.0 

 

10.8 

 

 

Jun. 20

09:30

 

GBP

 

 

 

Claimant Count Change 

8.1K

 

-3.0K 

 

-12.8K 

   

 

17:30

 

USD

 

 

 

Interest Rate Decision 

0.25%

 

0.25% 

 

0.25% 

 

 

 

19:15

 

USD

 

 

 

Fed Chairman Bernanke Speaks 

 

 

 

 

 

 

 

 

23:45

 

NZD

 

 

 

GDP (QoQ) 

1.1%

 

0.5% 

 

0.4% 

   

Jun. 21

09:30

 

GBP

 

 

 

Retail Sales (MoM) 

1.4%

 

1.2% 

 

-2.4% 

   

 

13:30

 

CAD

 

 

 

Core Retail Sales (MoM) 

-0.3%

 

0.2% 

 

0.3% 

   

 

13:30

 

USD

 

 

 

Initial Jobless Claims 

387K

 

380K 

 

389K 

   

 

15:00

 

USD

 

 

 

Existing Home Sales 

4.55M

 

4.57M 

 

4.62M 

 

 

Jun. 22

09:00

 

EUR

 

 

 

German Ifo Business Climate Index 

105.3

 

105.9 

 

106.9 

 

 

 

13:30

 

CAD

 

 

 

Core CPI (MoM) 

0.2%

 

0.3% 

 

0.4% 

 

 

 Historical:

Highest: 49.813 on Apr 25, 2011

Average: 27.592over 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

Previous

Jun 25

6:00

EUR

GfK German Consumer Climate

5.7

25th-30th

GBP

Nationwide HPI m/m

0.3%

14:00

USD

New Home Sales

343K

Jun 26

8:30

GBP

Public Sector Net Borrowing

-18.8B

13:00

USD

S&P/CS Composite-20 HPI y/y

-2.6%

14:00

USD

CB Consumer Confidence

64.9

Jun 27

All Day

EUR

German Prelim CPI m/m

-0.2%

8:30

GBP

BBA Mortgage Approvals

32.4K

10:00

GBP

CBI Realized Sales

21

12:30

USD

Durable Goods Orders m/m

0.2%

14:00

USD

Pending Home Sales m/m

-5.5%

14:30

USD

Crude Oil Inventories

 

Jun 28

7:55

EUR

German Unemployment Change

0K

8:30

GBP

Current Account

-8.5B

8:30

GBP

BOE Credit Conditions Survey

 

8:30

GBP

Final GDP q/q

-0.3%

12:30

USD

Unemployment Claims

 

12:30

USD

Final GDP q/q

1.9%

23:01

GBP

GfK Consumer Confidence

-29

Jun 29

29th-4th

EUR

German Retail Sales m/m

0.6%

6:45

EUR

French Consumer Spending m/m

0.6%

7:00

CHF

KOF Economic Barometer

0.81

8:00

EUR

M3 Money Supply y/y

2.5%

9:00

EUR

CPI Flash Estimate y/y

2.4%

12:30

USD

Core PCE Price Index m/m

0.1%

12:30

USD

Personal Spending m/m

0.3%

13:45

USD

Chicago PMI

52.7

13:55

USD

Revised UoM Consumer Sentiment

74.1

 

Silver Fundamental Analysis June 25, 2012, Forecast

Analysis and Recommendations:

Silver continued to decline today, on the cues from Gold and the overall weakness in the commodities market. Base metals and precious metals both declined. Silver fell 0.197 to trade at 26.642 down .73%

With a global slowdown and poor eco data from Germany where today’s report showed an overall slowdown in the German economy, shaking up EU markets, as Germany is expected to be the work horse that will pull the EU from the economic abyss.

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 for June 22, 2012 actual v. forecast

Date

 

Currency

 

 

 

Event

Actual

 

Forecast

 

Previous

 

 

 

 

EUR

 

 

 

German Ifo Business Climate Index 

105.3

 

105.9

 

106.9

 

 

 

 

EUR

 

 

 

German Current Assessment 

113.9

 

112.3

 

113.2

   

 

 

EUR

 

 

 

German Business Expectations 

97.3

 

99.8

 

100.8

   

 

 

CAD

 

 

 

Core CPI (MoM) 

0.2%

 

0.3%

 

0.4%

 

 

 

 

CAD

 

 

 

CPI (MoM) 

-0.1%

 

0.3%

 

0.4%

 

 

 

 

CAD

 

 

 

CPI (YoY) 

1.2%

 

2.0%

 

2.0%

 

 

 

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

Date

Time

Currency

 Event

Previous

Jun 25

6:00

EUR

GfK German Consumer Climate

5.7

25th-30th

GBP

Nationwide HPI m/m

0.3%

14:00

USD

New Home Sales

343K

Jun 26

8:30

GBP

Public Sector Net Borrowing

-18.8B

13:00

USD

S&P/CS Composite-20 HPI y/y

-2.6%

14:00

USD

CB Consumer Confidence

64.9

Jun 27

All Day

EUR

German Prelim CPI m/m

-0.2%

8:30

GBP

BBA Mortgage Approvals

32.4K

10:00

GBP

CBI Realized Sales

21

12:30

USD

Durable Goods Orders m/m

0.2%

14:00

USD

Pending Home Sales m/m

-5.5%

14:30

USD

Crude Oil Inventories

 

Jun 28

7:55

EUR

German Unemployment Change

0K

8:30

GBP

Current Account

-8.5B

8:30

GBP

BOE Credit Conditions Survey

 

8:30

GBP

Final GDP q/q

-0.3%

12:30

USD

Unemployment Claims

 

12:30

USD

Final GDP q/q

1.9%

23:01

GBP

GfK Consumer Confidence

-29

Jun 29

29th-4th

EUR

German Retail Sales m/m

0.6%

6:45

EUR

French Consumer Spending m/m

0.6%

7:00

CHF

KOF Economic Barometer

0.81

8:00

EUR

M3 Money Supply y/y

2.5%

9:00

EUR

CPI Flash Estimate y/y

2.4%

12:30

USD

Core PCE Price Index m/m

0.1%

12:30

USD

Personal Spending m/m

0.3%

13:45

USD

Chicago PMI

52.7

13:55

USD

Revised UoM Consumer Sentiment

74.1

Upcoming Government Bond Auctions

Date Time Country 

Jun 25  09:10  Norway

Jun 25  09:30  Germany

Jun 25  10:00  Belgium

Jun 25  15:30  Italy

Jun 26  00:30  Japan

Jun 26  08:30  Holland

Jun 26  08:30  Spain

Jun 26  09:10  Italy

Jun 26  09:30  UK

Jun 26  14:30  UK

Jun 26  17:00  US

Jun 27  09:10  Italy

Jun 27  09:10  Sweden

Jun 27  17:00  US

Jun 28  09:10  Italy

Jun 28  17:00  US

Silver Forecast June 22, 2012, Technical Analysis

The silver markets have been grinding along for some time now. We have been waiting for a move, and on Thursday finally got it. As expected, the trend continued lower as the market broke down again. The support has been very stubborn, so there are more than a couple of moments that we can remember being doubtful.

However, the market seems to be focusing more on the industrial part of the value of silver, and not the “fear” part of the equation. Simply put, there is less industrial demand for the metal at the moment and with the global economy slowing down – it is likely to continue to weaken overall.

The recent action has been very slow, and we have remained fairly sanguine as the market simply wasn’t doing much. The consolidation was becoming very obvious, and there were two very distinct levels that we warned you about: The $30 and $27 handles. The market seemed to be “stuck” between the two.

The trend was certainly down, so we always preferred a down move if it could come. One of the biggest criteria for selling this market was a daily close below the $27 level, something we are getting as I write this. Now that this has happened, it appears the next down leg in this market can begin.

We certainly wouldn’t buy silver at this point, even though there are some analysts that suggest it is “cheap.” Remember, cheap can get cheaper. Also, there is no real support in the market until we see $25, and this level looks a bit minor at this point as well truth be known. Because of this, we wouldn’t be surprised if we eventually get down to the $20 level as it is a much larger support zone from the look of the charts.

We are going to sell right way and sell rallies as we go forward. The shorter term charts will be used to our entries, such as the hourly chart. We will not buy at this point, and would have to see the $30 level overtaken in order to do so.

 

Silver Forecast June 22, 2012, Technical Analysis
Silver Forecast June 22, 2012, Technical Analysis

Silver Fundamental Analysis June 22, 2012, Forecast

Analysis and Recommendations:

Silver followed gold on the tumble trading at 27.453 down 3.30% in today’s session.

In case of silver, the concerns are more than that in case of gold as on one hand, the global economy is witnessing a host of issues, due to which demand for industrial metals could take a hit; while on the other hand, its presence as a precious metal is not allowing further downside in prices. But net-net, its movement on either side is largely restricted and this barrier would only open up when uncertainties regarding the European economic crisis ease.

We are about to enter the second-half of the year and the status of the global financial markets is getting worse in terms of risk appetite. Investors are getting more cautious about entering into gold and are now opting for other investment options. News doing rounds also indicate that investor interest has emerged in case of platinum, as gold and silver witness an irregular performance against the current macroeconomic scenario.

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 Releases for June 21, 2012 actual v. forecast

Date

 

Currency

 

 

 

Event

Actual

Forecast

Previous

Jun. 21

 

CNY

 

 

 

Chinese HSBC Manufacturing PMI 

48.10

 

48.40

 

 

EUR

 

 

 

French Manufacturing PMI 

45.3

44.5

44.7

 

 

EUR

 

 

 

German Manufacturing PMI 

44.7

45.2

45.2

 

 

EUR

 

 

 

Manufacturing PMI 

44.8

44.9

45.1

 

 

GBP

 

 

 

Retail Sales (MoM) 

1.4%

1.2%

-2.4%

 

 

GBP

 

 

 

Retail Sales (YoY) 

2.4%

2.0%

-1.1%

 

 

GBP

 

 

 

CBI Industrial Trends Orders 

-11

-20

-17

 

 

CAD

 

 

 

Core Retail Sales (MoM) 

-0.3%

0.2%

0.3%

 

 

CAD

 

 

 

Retail Sales (MoM) 

-0.5%

0.3%

0.4%

 

 

USD

 

 

 

Initial Jobless Claims 

387K

380K

389K

 

 

USD

 

 

 

Continuing Jobless Claims 

3299K

3275K

3299K

 

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

Date

Time

Currency

 Event

Forecast

Previous

Jun 22

8:00

EUR

German Ifo Business Climate

 

106.9

All Day

EUR

ECOFIN Meetings

   

13:00

EUR

Belgium NBB Business Climate

 

-11.2

Upcoming Government Bond Auctions

Date Time Country 

Jun 22  15:30  Italy

Jun 25  09:10  Norway

Jun 25  09:30  Germany

Jun 25  10:00  Belgium

Jun 25  15:30  Italy

Jun 26  00:30  Japan

 

Silver a Friend of Optimists and a Foe of Risks

Silver a Friend of Optimists and a Foe or Risks
Silver a Friend of Optimists and a Foe or Risks
Last 15 Wks Correlation    Last 50 Wks Correlation    Last 100 Wks Correlation   
0.863550183 0.588288212 0.077688478

 

Silver is forming an obvious descending triangle price formation. It is a formation that symbolizes weakening strength to move up which resulted in lower lows to form the sloping side of a triangle. $27.00 remains a strong buying point which resulted in a very strong support that stretches it way back to Year 2011.

A correlation study is conducted to understand the Silver/USD and the 10Yrs US Treasury bond. Looking at the correlation for 100 weeks (approximate 2yrs worth of data), there shown little relationship between the Silver/USD and 10Yrs US bond. However, as we move our limit to 50 weeks, we are able to see moderate positive relationship. Try moving it to 15 weeks (3 months) you will see a strong correlation of 0.86. Falling US Bond Yield is a result of risks aversion and this also resulted in price of silver to fall as the USD strengthen as a safe haven status. We can say that in the midterm, silver price is more or less determined by the investment risks profile. In the longer run, it is almost a good diversified asset to have with the bond.

Understanding the fact that silver is a friend of optimists is important as it will guide us on our short term entry/exit. Especially in the event of euro crisis and detrimental health of US and China economies, we can almost be sure to take silver out of our portfolio and shift our holdings towards bonds. Any entry/exit can have added confidence when you give the bond market a check. 

Silver Forecast June 21, 2012, Technical Analysis

The silver markets somewhat disappointed during the Wednesday session as the Federal Reserve’s extension of “Operation Twist” failed to get the markets moving in general. The silver markets have been stuck in a range between the $27 and $30 levels, and at the end of the session is still in the middle of this area. This leaves us simply watching this market, and not trading it as there is far too much choppiness in the meantime for us to get involved. On a break of the $30 level, we would buy. On the other hand, if we close below the $27 level on a daily candle, we would be sellers.

Silver Forecast June 21, 2012, Technical Analysis
Silver Forecast June 21, 2012, Technical Analysis

Silver Fundamental Analysis June 21, 2012, Forecast

Analysis and Recommendations:

Silver followed in the wake of gold, falling 0.046 to trade at 28.32. Silver was up in early electronic trading and was also expected to trade sideways today, ahead of the Fed announcements, but with the risk on environment, investors moved out of the metal to other assets. Markets still wait for the Fed releases later today.

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 for June 20, 2012 actual. v. forecast

Date

 

Currency

   

 

Event

Actual

 

Forecast

 

Previous

 

 

 

 

JPY

 

 

 

Trade Balance 

-0.66T

 

-0.36T 

 

-0.51T 

   

 

 

GBP

 

 

 

Average Earnings Index +Bonus 

1.4%

 

0.8% 

 

0.9% 

   

 

 

GBP

 

 

 

Claimant Count Change 

8.1K

 

-3.0K 

 

-12.8K 

   

 

 

USD

 

 

 

Interest Rate Decision 

 

 

0.25% 

 

0.25% 

 

 

 

 

USD

 

 

 

FOMC Statement 

 

 

 

 

 

 

 

 

 

USD

 

 

 

Fed Chairman Bernanke Speaks 

 

 

 

 

 

 

 

 

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

Date

Time

Currency

 Event

Forecast

Previous

Jun 21

6:00

CHF

Trade Balance

 

1.33B

7:00

EUR

French Flash Manufacturing PMI

 

44.7

7:00

EUR

French Flash Services PMI

 

45.1

7:15

CHF

Industrial Production q/q

 

7.9%

7:30

EUR

German Flash Manufacturing PMI

 

45.2

7:30

EUR

German Flash Services PMI

 

51.8

8:00

EUR

Current Account

 

9.1B

8:00

EUR

Flash Manufacturing PMI

 

45.1

8:00

EUR

Flash Services PMI

 

46.7

8:30

GBP

Retail Sales m/m

 

-2.3%

10:00

GBP

CBI Industrial Order Expectations

 

-17

12:30

USD

Unemployment Claims

 

386K

13:00

USD

Flash Manufacturing PMI

 

54.0

14:00

USD

Existing Home Sales

 

4.62M

14:00

USD

Philly Fed Manufacturing Index

 

-5.8

Jun 22

8:00

EUR

German Ifo Business Climate

 

106.9

All Day

EUR

ECOFIN Meetings

   

13:00

EUR

Belgium NBB Business Climate

 

-11.2

Upcoming Government Bond Auctions

Date Time Country 

Jun 21  08:30  Spain

Jun 21  08:50  France

Jun 21  09:30  UK

Jun 21  09:50  France

Jun 21  15:00  US

Jun 21  17:00  US

Jun 22  15:30  Italy

Jun 25  09:10  Norway

Jun 25  09:30  Germany

Jun 25  10:00  Belgium

Jun 25  15:30  Italy

Jun 26  00:30  Japan

Jun 26  08:30  Holland

Jun 26  08:30  Spain

Jun 26  09:10  Italy

Jun 26  09:30  UK

Jun 26  14:30  UK

Jun 26  17:00  US

Silver Forecast June 20, 2012, Technical Analysis

The silver markets continued to be very quiet on Tuesday as the market seems to be waiting for the Federal Reserve announcement. The Fed is suspected of easing by many traders out there, and as a result the silver markets could be coiling up for an explosive move. A move higher would be possible if the Fed does ease, but if it doesn’t – this market will fall as a result of the strengthening US dollar.

The area that we are trading in is still a consolidative and choppy rectangle for our money, and as a result we are waiting to see a break out of the area. The $30 level on the upside needs to give way for us to buy, and a break of the $27 level to the downside is needed for us to sell. 

Silver Forecast June 20, 2012, Technical Analysis
Silver Forecast June 20, 2012, Technical Analysis

Silver Fundamental Analysis June 20, 2012, Forecast

Analysis and Recommendations:

Silver is trading at 28.508 slightly off by 0.163 following the cues from gold and the overall metal group, silver traded in a closed tight range with little direction.

There is little else to report on this commodity, as most of the markets are now positioned ahead of tomorrow’s FOMC statements expecting additional monetary easing.

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 June 19, 2012 actual v. forecast

Date

 

Currency

 

 

 

Event

Actual

 

Forecast

 

Previous

 

 

Jun. 19

 

AUD

 

 

 

Monetary Policy Meeting Minutes 

 

 

 

 

 

 

 

 

 

GBP

 

 

 

Core CPI (YoY) 

2.2%

 

2.3% 

 

2.1% 

 

 

 

 

GBP

 

 

 

CPI (YoY) 

2.8%

 

3.0% 

 

3.0% 

 

 

 

 

GBP

 

 

 

CPI (MoM) 

-0.1%

 

0.1% 

 

0.6% 

 

 

 

 

EUR

 

 

 

German ZEW Economic Sentiment 

-16.9

 

4.0 

 

10.8 

 

 

 

 

EUR

 

 

 

ZEW Economic Sentiment 

-20.1

 

-5.7 

 

-2.4 

 

 

 

 

USD

 

 

 

Building Permits 

0.780M

 

0.728M 

 

0.723M 

 

 

 

 

USD

 

 

 

Housing Starts 

0.708M

 

0.720M 

 

0.744M 

   

 

 

CAD

 

 

 

Wholesale Sales (MoM) 

1.5%

 

1.0% 

 

0.3% 

   

 

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

Date

Time

Currency

 Event

Forecast

Previous

Jun 20

6:00

EUR

German PPI m/m

 

0.2%

8:30

GBP

Claimant Count Change

 

-13.7K

8:30

GBP

MPC Meeting Minutes

0-0-9

0-0-9

8:30

GBP

Unemployment Rate

 

8.2%

9:00

CHF

ZEW Economic Expectations

 

-4.0

14:30

USD

Crude Oil Inventories

 

-0.2M

16:30

USD

FOMC Statement

   

16:30

USD

Federal Funds Rate

<0.25%

<0.25%

18:00

USD

FOMC Economic Projections

   

18:15

USD

FOMC Press Conference

   

Jun 21

6:00

CHF

Trade Balance

 

1.33B

7:00

EUR

French Flash Manufacturing PMI

 

44.7

7:00

EUR

French Flash Services PMI

 

45.1

7:15

CHF

Industrial Production q/q

 

7.9%

7:30

EUR

German Flash Manufacturing PMI

 

45.2

7:30

EUR

German Flash Services PMI

 

51.8

8:00

EUR

Current Account

 

9.1B

8:00

EUR

Flash Manufacturing PMI

 

45.1

8:00

EUR

Flash Services PMI

 

46.7

8:30

GBP

Retail Sales m/m

 

-2.3%

10:00

GBP

CBI Industrial Order Expectations

 

-17

12:30

USD

Unemployment Claims

 

386K

13:00

USD

Flash Manufacturing PMI

 

54.0

14:00

USD

Existing Home Sales

 

4.62M

14:00

USD

Philly Fed Manufacturing Index

 

-5.8

Jun 22

8:00

EUR

German Ifo Business Climate

 

106.9

All Day

EUR

ECOFIN Meetings

   

13:00

EUR

Belgium NBB Business Climate

 

-11.2

 

Silver Forecast June 19, 2012, Technical Analysis

The silver markets fell during the session on Monday, as the commodity continues to tread water in the $27 to $30 range. The market looks like it wants to grind slightly higher, but the move probably won’t happen until the Federal Reserve ends its meeting on Wednesday as the announcement could move the Dollar in general. The falling Dollar will give the silver markets a lift, but considering that the silver markets are also dependant on industrial demand, it is likely that the silver markets continue to underperform against the gold markets. However, if the Dollar rises, the silver markets may be able to finally break below the $27 level in order to sell. In the meantime, we need to see a break out of the current range to take a position. 

Silver Forecast June 19, 2012, Technical Analysis
Silver Forecast June 19, 2012, Technical Analysis