Archive | April, 2013

Gold jumps 1%, ETFs holdings at three-year low

22 Apr

Gold jumped more than 1 percent on Monday after a rebound above USD 1,400 ignited technical buying, but sentiment was shaky as steady outflows from exchange-traded funds trimmed holdings to their lowest in three years.

The technical outlook for gold, which has plunged more than 15 percent so far this year, is yet to improve although the safe-haven asset could find support from a rush in physical buying in Asia and other parts of the world.

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Gold added USD 13.91 an ounce to USD 1,417.76 by 0212 GMT after rising to as high as USD 1,421, still below Friday’s session-high of around USD 1,424.

Gold posted its biggest-ever daily loss in dollar terms last Monday, shocking veteran investors, who see gold as portfolio protection against inflation and other market risks. Prices sank to around USD 1,321 on April 16, its lowest in more than 2 years.

“The aggressiveness of the fall suggests that we are still in a consolidation rather in a reversal role. For me, the USD 1,435 level is likely to provide resistance,” said Tim Riddell, head of ANZ Global Markets Research, Asia.

“We really need to get back into the USD 1,500s to say that there’s something more substantial taking place. The close above USD 1,400 may have taken the negative pressure out of gold in the near term. A close back below that level will heighten the risks of new lows.”

US gold for June delivery was USD 1,417.60 an ounce, up USD 22.00.

For a 24-hour gold chart analysis: http://graphics.thomsonreuters.com/WT1/20132204100219.jpg

Inflation adjusted gold price timeline (since 1970): http://link.reuters.com/jem47t

Gold demand in China: http://link.reuters.com/bat34t

Gold in currencies: http://link.reuters.com/cyv95s
Gold has failed to react to tension in the Korean peninsula, with its safe-haven appeal dented by expectations the US Federal Reserve will soon end its bullion-friendly bond buying programme, which could ease inflationary pressure.

The precious metal had rallied to an 11-month high in October last year after the Fed announced its third round of aggressive economic stimulus, raising fears the central bank’s money-printing to buy assets would stoke inflation.

Outflows on exchange-traded funds could also indicate that investors were parking their money elsewhere, although last week’s trading data from the Unites States showed that funds had injected new money to gold futures.

Hedge funds and money managers raised their net longs in gold futures and options in the week to April 16, a report by Commodity Futures Trading Commission (CFTC) showed on Friday, as new money entered the market at lower prices.

But holdings of the largest gold-backed exchange-traded-fund, New York’s SPDR Gold Trust, dropped 0.88 percent on Friday from Thursday, while those of the largest silver-backed ETF, New York’s iShares Silver Trust remained unchanged for the same period.

Gold prices have also come under pressure due to Cyprus’ plan to sell excess gold reserves to raise around 400 million euros that led to speculation other indebted euro zone countries could follow suit.

In other markets, bulls drove Japanese shares to nearly five-year highs as yen bears clawed at the symbolic 100 yen/dollar door after the Group of 20 gatherings in Washington all but endorsed the Bank of Japan’s aggressive reflation drive.

Source: http://www.moneycontrol.com/news/commodities/gold-jumps-1-etfs-holdings-at-three-year-low_856467.html

Oil Edges up Slightly in Second Straight Day of Gains

20 Apr

Brent crude oil prices closed below USD 100 a barrel on a second day of modest gains on Friday, after surpassing USD 100 earlier in the session and recovering some ground after a steep six-day decline.

Brent has fallen nearly 10 percent since the beginning of April, a decline that accelerated earlier this week after a cut in oil demand forecasts by global energy agencies and weak economic data from the United States and China, the world’s two largest oil consumers.

Friday marked the second day of gains for Brent after it closed at USD 97.69 on Wednesday, the lowest level since July 2012 and a price that analysts said was attractive to bargain hunters.

Analysts said the market seemed to be stabilizing after a week of heavy liquidation in which prices tumbled from over USD 103 as of last Friday, along with a rout in gold and industrial metals.

“Today’s gains looked like a follow-up to yesterday’s correction and one that could possibly be maintained for a couple more sessions,” Jim Ritterbusch, president at Ritterbusch and Associates in Galena, Illinois, wrote in a research note.

Brent crude settled up 52 cents a barrel at USD 99.65, down from an intraday high of USD 100.33. US crude gained 28 cents to settle at USD 88.01.

The May US crude contract expires Monday, April 22.

Most USD  stocks rose on Friday, taking the oil complex with them. USD  equities back a day after the S&P 500 closed below its 50-day moving average for the first time this year, with help from some blue-chip tech names.

“This remains a market very much driven by the equity markets. They’ve been rebounding and we’re just knocking along with that,” said Kyle Cooper, managing director of research at IAF Advisors in Houston, Texas.

“Crude inventories are at an all-time high, but we’re up today,” he added. “There are some people who want to believe it’s a physical market, but it’s not. It’s a financial market.”

Yet worries about global demand and oversupply persist, and market participants remained cautious as to whether the recovery had legs. Front-month oil prices have fallen more than 3 percent for the week.
“Oil prices were technically oversold so we are seeing some buyers coming in but they are not great volumes,” said Rob Montefusco, an oil broker at Sucden Financial in London. “There is nothing to suggest we can go up on a sustained basis – we were just overdone on the downside.”

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After spending the week below 30 on the relative strength index (RSI), a technical momentum indicator, Brent crude poked its head above 30 on Friday.

A reading of 30 or below indicates an oversold condition to chart-watching traders.

Data released during the week contributed to falling prices. Chinese first-quarter GDP growth was seen as disappointing, down at 7.7 percent from 7.9 percent in the fourth quarter. In the United States, the number of people filing new claims for unemployment benefits rose last week, and factory activity in the nation’s mid-Atlantic region cooled in April.

Oil prices are down more than USD 10 a barrel from the start of this month. Brent touched its lowest level since July 2012 on Thursday at USD 96.75 a barrel after commodities took a hammering across the board earlier in the week.

Earlier in the week gold suffered its worst two-day fall in 30 years. Copper is still down below USD 7,000 a tonne, on course for its worst week since 2011.

But with the exception of industrial metals, the complex now appears to have stabilized. “There is a general feeling in the market that Brent won’t go much below USD 100 at this stage as a lot of speculative length has now been liquidated,” said Ole Hansen, head of commodity strategy at Saxo Bank.

The USD 100 level is seen as critical, because it is a budget breakeven point for OPEC members such as Iran, Iraq and Algeria.
“OPEC doesn’t want to see the price fall much below USD 100, and given that they continue to produce at very high levels, they can just turn the taps down a little bit, which would quickly change the balance in the market,” Hansen said.

Iran and Venezuela have already raised concerns about the price fall and said discussions had taken place over whether to call an emergency OPEC meeting before the group’s scheduled meeting at the end of May.

Source: moneycontrol

Comex Gold slips more than 1% as selling pressure continues

18 Apr

US initial jobless claims and continuing jobs claims data are scheduled to be released later today and the outcome may impact the bullion movement slightly.

MUMBAI (Commodity Online): Gold in the international market fell further by more than one percent on persisting selling pressure as investors lost their confidence on health of the global economy.

Investors are withdrawing cash from exchange traded funds (ETFs) there by pulling down gold.

Comex gold futures for June delivery was trading down by 1.41 percent at $1363.25 per troy ounce as of 09.56 AM IST on Thursday.

Gold futures for June delivery on India’s Multi Commodity Exchange (MCX) was trading down by 1% at Rs.25423 per 10 grams as of 10.16 AM IST on Thursday.

Investors are looking for investment other than risk assets after losing confidence on so called ‘safe haven asset’.

“You can see that sentiment is very fragile, very weak. The down trend may not be over and U.S. investors have kept selling over the last two days,” Joyce Liu, an investment analyst at Phillip Futures in Singapore said to Reuters.

“If we continue to see this kind of drop, then maybe the physical buying won’t be sustained because people will think the price is going to go drop further. We may actually see a decrease in physical demand,” Joyce added.

Meanwhile, gold failed to utilize persisting tensions in Korean Pennsylvania and uncertainty over US Federal monetary stimulus.

Other risk assets have also recorded a negative trend as a result of drop in US and European equity market. On Monday, the precious metal recorded its biggest ever daily fall in dollar terms.

US initial jobless claims and continuing jobs claims data are scheduled to be released later today and the outcome may impact the bullion movement slightly.

Silver is also trading negative in the global market. Comex silver for May delivery was down by 0.91 percent at $23.113 per troy ounce as of 10.01 AM IST on Thursday.

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Source: commodityonline

Gold hovers near 19-month low; bargain buying on

17 Apr

Indian gold futures edged lower on Wednesday, near their lowest level in more than 19 months, on losses in the global markets and a stronger rupee, triggering bargain buying among physical traders.

The actively traded gold contract for June delivery on the Multi Commodity Exchange (MCX) was 181 rupees lower at 25,585 rupees per 10 grams.

US gold for June delivery was 0.37 percent lower at $1,382.2 an ounce. The rupee, which firmed in trade on Wednesday, plays an important role in determining the landed cost of the dollar-quoted yellow metal.

“There are many buyers after consolidation in prices … sales will rise for Akshaya Tritiya,” said SK Jain, vice-president of All India Sarafa Association.

India, the world’s biggest buyer of the yellow metal, will celebrate Akshaya Tritiya, a key gold buying festival, next month. The wedding season has also begun and will continue till early June.

India has been trying to curb imports to put a lid on the record-high current account deficit. The federal government raised the import duty on gold, which it called a dead investment, by 50 percent to 6 percent in January.

On April 2, Finance Minister P. Chidambaram suggested the government was unlikely to raise the import tax on gold further to avoid gold smuggling.

May silver was 592 rupees lower at Rs 42,603 per kilogram.

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Source: http://www.moneycontrol.com/news/commodities/gold-hovers-near-19-month-low-bargain-buying-on_854157.html

MARKET CALLS FOR TODAY 17-APRIL

17 Apr

SELL SILVER (MAY) BELOW 43600 TG- 43500/43350/43150 SL-43750

Buy ALBK Above 137 tgt 139 143 sl 133

SELL GOLD (JUNE) BELOW 25535 TG-25505/25470/25430 SL-25570

SELL LEAD (APR) BELOW 110.60 TG-110.10/100.50/99.80 SL-111.20

 

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The scary number for gold investors: USD 1,200

16 Apr

Many gold producers will struggle to stay afloat if the gold price slumps below USD 1,200 analysts have told CNBC, potentially putting the gold mining industry at severe risk beyond 2017, according to Goldman Sachs predictions.

The much talked about decline in gold continued on Monday, with spot prices falling USD 1,400, compounding fears the 12-year run in the precious metal has finally come to an end.

Gold miners were especially hard hit, with a sell-off in the sector in Australia, China and the UK.

But at what point does the demise of the gold price make gold miners uninvestable?

“As you get closer to the cash cost production for gold, which is around USD 1,200 an ounce, people get nervous,” Jonathan Barratt, founder of Barratt’s Bulletin told CNBC.

James Sutton, client portfolio manager of the JP Morgan Natural Resources fund, agreed, telling CNBC: “The level where we think the gold mining industry will struggle is USD 1,200.”

While he said gold may not reach those levels, the fund was taking precautions, trimming its gold holdings to lows not seen since the financial crisis.

“Gold is now just over 20 percent in both the European and U.K. portfolios, which is a meaningful step change from where we were last summer when we had 31 percent, and it is the lowest weighting we have had in gold since the financial crisis,” he said.

As mine production makes up just 10 percent of the gold industry, people could still gain exposure to gold through many different avenues, but many businesses extracting gold from the ground could fold, he added.

“It is around about the USD 1,200 we think the gold industry as a whole struggles, but there are many companies that can still survive and be profitable,” said Sutton “If there was a further deterioration in the gold market, then our portfolio would become even more concentrated in those stocks that we thought were going to be the last men standing.”

Goldman Sachs, which downgraded its gold price target and advised investors to short the precious metal last week, said its long term price forecast from 2017 onward is USD1,200 and so recommended producers lock in current gold prices for 2013 and beyond.

“Over that horizon forecast, we expect US real rates to stabilize and see risks to US inflation as more symmetrical. And while higher inflation may be the catalyst for the next cycle in gold prices, this is likely to be several years away,” analysts led by Damien Courvalin said.

Gold Investors Battered

For investors in gold mining funds, 2013 has already been a very bad year.

Globally, gold mining and resource funds are down 10 percent on average in just the first quarter, before the latest falls,with the worst performing fund down 22 percent, according to investment research firm Morningstar.

In the UK, eight out of the ten worst performing funds in first quarter were gold and resources funds with an average loss of 12 percent, compared to the FTSE 100, which rose 9.29 percent over the same period, according to Morningstar.

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—By CNBC‘s Jenny Cosgrave: Follow her on Twitter @jenny_cosgrave

Sell MCX Gold June Fut at Rs 28040: Fortune Financial

15 Apr

Fortune Financial Services has come out with its report on metals, Crude Oil and Natural Gas. The research firm says one can sell MCX Gold June Futures at Rs 28040 with stoploss above Rs 28400 for the target of Rs 27800-27600.

MCX Gold June futures contract is looking weak on chart, day traders can sell on small pullback Major support is seen in range of 27730, 27534 and 27283. While important resistance is seen near 28176, 28428 and 28623. (Sell at 28040, target 27800-27600 SL above 28400)

MCX Silver May futures contract is looking weak on chart, day traders can sell on small pullback Major support is seen in range of 48559 , 48216 and 47776 . While important resistance is seen near 49341 , 49781 and 50124. (Sell at 49300 Target 48200 SL above 49800)

MCX Natural Gas April futures contract is looking strong on chart, day traders can buy on small dips Major support is seen in range of 229.48 , 227.86 and 225.78 . While important resistance is seen near 233.18, 235.3 and 236.9.  (Buy at 229-227 Target 238 SL below 224)

MCX Crude Oil April futures contract is looking weak on chart, day traders can sell on small pullback Major support is seen in range of 4940, 4905 and 4861. While important resistance is seen near 5020, 5065 and 5099. (Sell at 5000 Target 4900 SL above 5070)

MCX Copper April futures contract is looking weak on chart, day traders can sell on small pullback Major support is seen in range of 401.67, 398.84 and 395.20. While important resistance is seen near 408.14, 411.8 and 414.6. (Sell at 410-412 target 398 SL above 416)

MCX Lead April futures contract is looking weak on chart, day traders can sell on small pullback Major support is seen in range of 110.27, 109.50 and 108.50. While important resistance is seen near 112.05, 113.0 and 113.8. (Sell at 113-113.5 Target 110 SL above 116)

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Source: moneycontrol