Tuesday, 28 May 2013

Gold Up After A Drop

Gold futures inched up after dropping below $1380 levels yesterday weighed down by strength in the US dollar, on rally in equities and on cut in gold price forecast by Bank of America Merrill Lynch.
Gold for August delivery is trading up $7.9 at $ 1386.8 an ounce on the Comex division of the New York Mercantile Exchange. It shed $7.80, or 0.6%, to settle at $1,379.70 an ounce. It traded as low as $1,372.80 but also briefly topped $1,400 during the session.
Tuesday marked the expiration for June gold options, likely contributing to volatility in the market. Floor trading was closed for Monday’s U.S. Memorial Day holiday.
Gold prices last week climbed about 1.6%, the best weekly performance since the week ended April 26, on the heels of weaker global equities and a decline in the dollar. Still, gold futures have fallen more than 6% this month.
Gold prices settled lower Tuesday as the U.S. dollar rose against key rivals, including the Japanese yen. Dollar-denominated gold and other commodities usually move lower when the dollar rises as it makes them more expensive for holders of other currencies to buy.
Bank of America Merrill Lynch also cut its 2013 forecast on gold by 12% to $1,478 an ounce. The analysts said “higher growth, rising nominal yields and subdued inflationary pressure have all limited investor buying.”
A rally in stocks in Europe and Asia on Tuesday, and sharp gains on Wall Street contributed further pressure on gold, luring investors away from the precious metal.
Data Tuesday helped to draw more attention away from gold. The U.S. consumer-confidence index climbed to a five-year high of 76.2 in May from an upwardly revised 69.0 in April, the Conference Board said Tuesday. Separate data showed that U.S. home-price growth was the fastest in nearly 7 years, with the S&P/Case-Shiller 20-city composite up 1.4%.
MCX June gold futures may open today’s session near Rs 26480 levels with resistance near Rs 26590 levels and support near Rs 26400 levels.

Monday, 27 May 2013

Dollar Boosts Gold; Floor Trading Closed

Gold got a boost in the thin trades today helped by weakness in the US dollar and also as the central banks increase gold reserves.
Russia, Kazakhstan and Azerbaijan increased their gold reserves in April, according to data on the International Monetary Fund website on Monday. Russia bought 269,000 troy ounces--bringing its reserves to 31.8 million ounces. Kazakhstan added 85,000 ounces. Its stocks are now 4 million ounces.
The Republic of Azerbaijan bought 32,000 troy ounces last month--increasing its reserves to 129,000 ounces, the latest IMF figures showed. It was the fourth consecutive month of purchases by Azerbaijan's central bank. In December it had no reserves.
Holdings at Turkey's central bank rose 586,000 ounces in April to 13.73 million ounces. It has begun accepting gold as collateral from commercial banks and analysts said this is the main reason for recent increases rather than purchases.
Gold futures for August delivery are trading at $ 1392.3 down $5.7 on the Comex division of the New York Mercantile Exchange. On Friday, it edged down 0.5% to settle the week at $1,387.50 a troy ounce. The metal is likely to find support near $1340 levels and resistance near $1415 levels in the near term.
Despite Friday’s modest decline, gold futures rose 2.15% on the week, the biggest weekly advance in a month, due mostly to a broadly weaker U.S. dollar.
The Japanese yen edged higher Monday, extending gains following the U.S. dollar’s worst weekly performance against its rival in about a year. The dollar bought 100.99 yen, down slightly from ¥101.09 on Friday. Last week, the dollar dropped roughly 1.7% against the yen.
In the week ahead, gold traders will be focusing on a flurry of U.S. economic data, including reports on the housing sector, consumer confidence and initial jobless claims. There will be no floor trading in New York on May 27 because of the Memorial Day holiday. All electronic transactions will be booked with May 28 trades for settlement.
MCX June gold are trading up Rs 11 at Rs 26417 per 10 grams. It may face a resistance near Rs 26470-500 levels with support near Rs 26340 levels.

Wednesday, 22 May 2013

Gold remained under pressure in the Asia electronic trades today weighed down by strength in the US dollar after the U.S. Federal Reserve indicated that the central bank could start tapering stimulus efforts in the coming months.
Gold futures for delivery in June lost $1, or 0.1%, to sell for $1,366.40 an ounce in electronic trade during Asian hours. The metal ended down $10.20, or 0.6%, at $1,370.10 an ounce, after Federal Reserve Chairman Ben Bernanke, during his time before a congressional committee, said the bank may wind down the pace of bond purchases in the “next few meetings,” though the decision would depend on economic data.
Earlier Wednesday, gold jumped to more than $1,400 after Bernanke said premature tightening of Fed policy “would also carry a substantial risk of slowing or ending the economic recovery and causing inflation to fall further.”
The dollar rallied after Bernanke’s statement, making gold and other dollar-denominated commodities more expensive for holders of other currencies to buy. The ICE dollar index, a gauge of the greenback’s movement against six other major currencies, built on Wednesday’s gains by rising to 84.477 from 84.251.
On the economic front today, China's manufacturing activity was contracting in May, according to preliminary data released Thursday, as HSBC's "flash" Purchasing Managers' Index fell to a seven-month low of 49.6 from April's final reading of 50.4. A result below 50 signals contraction.
MCX June bullion futures may open above Rs 26000 with resistance near Rs 26050-90 levels and support near Rs 25900 levels.

Thursday, 16 May 2013

Gold Continues Downward Rally

Gold futures continued its downward rally on the final day of the week, as the rally in dollar and the equity markets eat away demand for the metal.
Gold for June delivery are trading down $10 at $ 1377 per ounce on the New York Mercantile Exchange. Yesterday, it shed $9.30, or 0.7%, to settle at $1,386.90 an ounce. Including Thursday’s loss, prices have fallen 5.9% in six straight trading sessions. They settled Thursday at their lowest since April 17.
The decline followed news of a decline in the U.S. inflation rate as well as a recent string of gains in U.S. equities that has drawn attention away from gold. U.S. consumer prices fell 0.4% in April, according to the Labor Department. The inflation rate over the past 12 months fell to 1.1% in April from 1.5% in March, marking the lowest level since November 2010.
Other data Thursday showing a jump in weekly U.S. jobless claims, a negative reading on a regional manufacturer business conditions index and a weaker dollar didn’t provide much support for the precious metal.
Jobless claims climbed to a six-week high and the Philadelphia Federal Reserve’s index of business conditions turned negative in May for the first time since February.
Meanwhile, the World Gold Council said in a report on Thursday that investors during the first quarter didn’t buy enough physical gold to offset outflows from gold-exchanged traded funds. Total world gold demand was 963 metric tons in the first quarter, down 13% from the same time a year ago, according to the report.
But the World Gold Council also said total ETF gold holdings in the first quarter were higher than the year-ago period, and demand for jewelry, bars and coins increased.
MCX June bullion futures may open today’s session near Rs 26070 levels with support around Rs 25970 and Rs 25920 levels.

Monday, 13 May 2013

Gold Eases To Two-Week Low

MCX Gold futures slipped in tune with the global prices as a broad retreat continued for the red metal amid a pullback in global stock markets. The metal had witnessed a sizeable fall in the last week, extending a drop from its highs around $1490 per ounce amid strength in US dollar and a continued outflow in major gold exchange trades funds. The metal fell to a two-week low of $1418 per ounce on Friday and remained depressed today. The benchmark COMEX futures slipped from highs near $1450 per ounce and currently trade at $1433.20, down $3.40 per ounce on the day.

Even as the prices have recovered in last few weeks, the declines in holdings in gold-backed exchange-traded funds remained a concern in the market. Gold holdings in the SPDR Gold Trust fell to 1051.65 tons on Friday lingering around their four-year low.

The Asian markets witnessed a mixed set of data from China. The industrial production in the country witnessed a smaller-than-expected rise in April, underlining worries that the economy may be losing steam. Output rose 9.3% from a year ago, which was up from March's figure of 8.9% but below market forecasts for a 9.5% rise. Fixed-asset investment also weakened in the first four months of 2013. However, the Chinese retail sales increased in line with expectations by an annualised 12.8% in April, up on the 12.6% rate witnessed in the previous month.

Meanwhile, India's trade deficit in April soared more than 70% from March as imports of gold and silver shot up over two times. The deficit widened to $17.8 billion from $10.31 billion in March. Imports in April rose 10.9% from a year earlier to $41.95 billion. That was mainly because of a sharp increase in the imports of gold and silver — India imported $7.5 billion worth of gold and silver in the past month, compared with $3.1 billion in the year-earlier period.

This is concurring with the fact that demand in the country after a ferocious drop in mid April has held very well. However, this data failed to prop up the prices must on Akshay Tritiya- considered a very good occasion to buy the yellow metal in India. The benchmark MCX Gold futures fell in a hurry, breaking under 26900 per 10 grams mark in early moves. The metal tanked to a low of Rs 26676 per 10 grams and edged up to trade at Rs 26772 per 10 grams right now, down Rs 227 or 0.84% on the day with a massive 17% increase in the open interest.

Sunday, 12 May 2013

Gold Extends Decline As Dollar Gains

Gold futures extended decline in the Asia electronic trades today as the US dollar stretched its last week’s gains against the Yen and Australian Dollar.
The ICE dollar index , which measures the U.S. dollar’s moves against six other major currencies, rose to 83.268, up from 83.132 late Friday in North America. Ahead of the figures, the Aussie traded at its lowest level against the U.S. dollar in about a year, buying 99.84 U.S. cents. It bought $1.0026 late Friday after briefly falling below the $1 level.
The U.S. dollar may react later Monday to data from China on industrial production and retail sales in April. Hours after those reports are expected to be released, the U.S. Commerce Department’s report on retail sales for April is due.
Gold for June delivery is trading down $9 at $ 1428 per ounce on the Comex division of the New York Mercantile Exchange. The metal is likely to find support near $1400 and $1370 levels. On the week, gold futures lost 1%, the first weekly decline in three weeks.
On Friday, gold futures for June delivery tumbled 1.5% to settle the week at $1,446.65 a troy ounce. Earlier on Friday, Comex gold fell by as much as 3.4% to hit a session low of $1,418.65 a troy ounce, the weakest level since April 24.
In the week ahead, gold traders will be focusing on a flurry of U.S. economic reports, including data on retail sales, building permits, jobless claims as well as a closely watched report on consumer sentiment.
MCX June delivery gold futures may open today’s session near Rs 26900 levels with support around Rs 26800-750 levels.

Thursday, 9 May 2013

Gold Dips On Profit Selling, Strong Green Back

Gold futures edged lower in range bound trade on Thursday, with investors hesitant to extend the previous session's strong gains as bearish chart signals remained intact. The Comex division of the New York Mercantile Exchange, gold futures for June delivery traded at $1,469.15 a troy ounce, down 0.3% on the day. Comex gold prices held in tight trading range between $1,467.55 a troy ounce, the daily low and a session high of $1,474.85 a troy ounce. Euro was quoting at $1.31, down 0.08% from last close. Global equities are in mixed trend with majority are marginally in red while commodities also shows same line of trend with copper and crude are down. Meanwhile, COMEX July silver quotes at $24.07, up 0.39% from last close. Gold futures rose more than 1.5% on Wednesday to hit a high of $1,475.55 a troy ounce, amid indications of surging demand for the precious metal in China, the world's second largest gold consumer. However, investors were hesitant to enter the market as the precious metal continued to trade below the key psychological $1,500-level, indicating chart signals remain bearish.
The demand for the metal from retail quarters has been soaring following a massive crash in prices during the middle of last month. Demand for gold coins and bars from India and China, the top two consumers have been highly impressive over the last few weeks. The crash in gold prices was triggered by speculative traders operating in the futures markets, according to an update from the WGC.
Chinese gold imports are likely to swell further after more than doubling to an all-time high in March as retail consumers pounced when prices plunged to a two-year low last month. China is the world's second largest buyer after India, and in both countries the steep fall in international gold prices in April unleashed years of pent up demand for coins, bars and jewellery. That will help bolster prices for the metal, which has been abandoned by funds in other parts of the world in the wake of its historic fall. “Physical demand picked up significantly over the last couple of weeks. Consumers and industrial users tend to see price drops as buying opportunities,” Zhang Bingnan, secretary-general of the China Gold Association.
Local gold futures failed to sustain Rs 27,200 mark level for the benchmark June Gold on MCX. Weak rupee which trades at above Rs 54.24 mark, up 0.17% from last close, limited the steep fall in the prices. MCX June Gold quotes at Rs 27,120, up Rs 26 from last close. Local gold futures may find support at Rs 27,000, Rs 26,900 and resistance at Rs 27,240, Rs 27,300 level. Silver futures are trading higher following their global trends, July Silver contract trades at Rs 45,275, up Rs 361 or 0.80% from last close.

Wednesday, 8 May 2013

Gold Down Mildly On Profit Taking

Gold futures are trading mildly lower in the Asia electronic session today as traders booked profit after the counter surged nearly 2% yesterday. The rate cuts by two central banks also proved bullish for the metal.
The Bank of Korea and Bank of Australia slashed their rates today and yesterday respectively. The Bank of Korea on Thursday cut its key interest rate by a quarter-point to 2.5%. Korean stocks were higher after Thursday's rate decision, with the Kospi Composite Index up 0.3% at 1,962.05.
Also yesterday, the Reserve Bank of Australia lowered rates surprising the markets. The RBA trimmed the policy cash rate by a quarter-point to 2.75%, with Gov. Glenn Stevens citing soft economic growth, tame inflation, “subdued” credit demand, and a historically high level for the Australian dollar.
Growth in Australia was close to trend in 2012 overall, but was a bit below trend in the second half of the year, and this appears to have continued into 2013,” Stevens wrote in a statement accompanying the decision, adding that employment growth has failed to keep up with population gains.
On the data front today, China's consumer price index rose slightly more than expected in April, while wholesale prices extended their fall. The April CPI showed a gain of 2.4% from a year earlier, led by a 4% rise in food prices, the National Bureau of Statistics said Thursday. The gain was more than March's 2.1%, though below February's spike of 3.2%.
The producer price index, meanwhile, fell by the most since October, dropping 2.6% against a decline of 1.9% in March. Chinese shares lost ground after the numbers, which would tend to reduce the odds of Beijing maintaining a loose monetary policy.
MCX June gold may open today’s session near Rs 27180 with support near Rs 27100 and Rs 26850 levels.

Gold Trades Higher On Bargain Buying

Gold futures traded higher on weak green back and physical demand. Strong gains in global equity markets triggered some profit taking in Gold, however, prices gained back on strong buying support. Equities gained further on the reports of ECB proposed buy plan of bad loans. The European Central Bank could soon be buying bad loans from struggling southern European nations in an effort to spur lending to businesses, German newspaper Die Welt reported on Wednesday, citing central bank sources. In addition to encouraging a revival of the asset-backed securities market, the ECB's Governing Council is also discussing, if the central bank could buy some of the securities itself, according to Die Welt. Gold futures lost more than 1% on Tuesday, as investors sold the precious metal amid a weak technical outlook. Gold investors later Wednesday may watch for comments on the market from hedge-fund billionaire John Paulson at a conference in Las Vegas. COMEX June Gold quotes at $ 1458.65, up $9.75 or 0.67% from last close, after trading in the range of $1446.95-1461.25 an ounce. Meanwhile, the silver quotes at $23.84, up 0.052 an ounce from last close. Euro currently quotes at $1.31, up 0.35% from last close.
MCX Gold bounced back from the previous losses on bargain buying triggered by strong global cues. The June Gold quotes at Rs 26,850, up Rs 128 or 0.49% from last close. Technically, the counter may edge up near Rs 26,970-27,050 and may find support in the range Rs 26,720-26,550 level. MCX Silver traded with marginal gains, after ending down 0.68% on last day. June Silver currently trades at Rs 44,873, up Rs 18 from last close.

Tuesday, 7 May 2013

Gold Inches Up In Asia

Gold futures inched up in the Asia electronic session today buoyed by the data optimism and a record finish in US equities yesterday.
An ounce of gold on the COMEX division of the New York Mercantile Exchange is trading up $ 5.9 at $ 1454.7 in early electronic trades today. However the metal has been trading in a tight range of $1440-1490 level for nearly 2 weeks.
Japanese stocks rallied on toward five-year highs Wednesday, outperforming other Asia markets. The Nikkei Stock Average climbed 1.4% to 14,371.65 in Tokyo late morning trade, climbing further a day after it soared 3.6% to finish at its highest level since June 2008.
The Shanghai Composite rose 0.2%, and Hong Kong’s Hang Seng Index added 0.6%, after official data showed China posted a trade surplus of $18.16 billion in April. Exports jumped 14.7% from a year-earlier and imports rose 16.8%, with both exceeding expectations.
Meanwhile, Reserve Bank of Australia lowered rates on Tuesday, surprising the markets. The RBA trimmed the policy cash rate by a quarter-point to 2.75%, with Gov. Glenn Stevens citing soft economic growth, tame inflation, “subdued” credit demand, and a historically high level for the Australian dollar.
“Growth in Australia was close to trend in 2012 overall, but was a bit below trend in the second half of the year, and this appears to have continued into 2013,” Stevens wrote in a statement accompanying the decision, adding that employment growth has failed to keep up with population gains.
MCX June gold futures may open today’s session near Rs 26790 levels with resistance near Rs 26850 levels and support near Rs 26710 levels.