The concerns over Spain ’s destiny keep escalating. Yesterday, investors started fleeing from stock and commodity markets in search of safe haven assets like US, German and Japanese bonds. As a result, the US Dollar is gaining strength while the Euro is showing weakness amid the continued eurozone crisis. Germany, Finland and the Netherlands keep resisting the idea of emitting common Eurobonds.
Amid a slowdown in the US employment growth, the amount of mortgage claims declined sharply. Pending home sales declined as well. This may well deny the supposition that the market has already reached the bottom. The employment and GDP reports are to come out today. They will be treated as indicator of the Fed Reserve’s future policies.
Japan’s manufacturing production showed some growth but failed to match the forecast (0.5%). The Japanese housing market showed significant y/y growth (10.3%).
Yesterday, the market of gold managed to break the negative correlation with the US Dollar. Gold rallied along with the USD index.
Forecast.
According to the Commodity Trading Department of , in order to resume the rally, gold may need to break and consolidate above 1566. If this is the case, the price will probably test 1575-1577. If an h1 bar closes above 1583, it may extend the rally up to 1595-1600. A failure to consolidate above 1566 will increase the probability of going down to 1550.
As for silver, it is expected to test the 28.0-28.10 resistance area today. On consolidating above 28.0, the price may well test 28.25, 28.50. A break and consolidation above 28.60 will give way to 29.0. A failure to consolidate above 28.0 will give way to 27.75, 27.75 and maybe 27.50.
