The political risks in the Middle East increased yesterday. Under the global pressure, China, India and Japan promised to lower their imports of crude oil from Iran at least by 10%.
It should be noted that these countries consume 45% of Iran’s total export of crude oil. The International Atomic Energy Agency mission in Iran is reported to have been banned from inspecting the country’s military bases. It seems like another round of nuclear talks has failed. Iran keeps insisting that it enriches uranium only for energy purposes not for producing nuclear weapons.
In the meantime, according to the analytic team of HSBC, China’s manufacturing sector has seen a decline for the 4th month in a row. Investors are still skeptical about Greece’s ability to reduce its public debt to acceptable levels.
Against this background, precious metals appreciated. Hong Kong dealers report about considerable demand in the market of physical gold. However, China’s import of gold and silver in January declined down to the lowest level in 3 years.
FORECAST:
According to the Department of Commodity Trading of , gold may test 1760 once the price consolidates above 1758-1759. On reaching the level, the price will probably rebound from it and retrace down to 1750, 1740. Once the price exceeds this year’s high and consolidates above the level, it will get a chance to rally up to 1773-1778, and maybe even 1800.
As for silver, the closest level of support is 34.1. The price will probably test it today, and maybe even 33.80. In order to resume the rally up to 35.0, silver will have to consolidate above 34.45.
