Nataly Kambur
Traders and investors are looking forward to the results of tomorrow’s ECB meeting. Most of them anticipate a 0.25% interest rate cut. Spain is to hold another bond auction tomorrow. The yield may hint at investors’ sentiments. The eurozone’s manufacturing production has been shrinking for the 11th month in a row.
Yesterday’s US manufacturing orders report showed an unexpected increase. Car sales also proved to be higher than a month ago. Stocks gained along with commodities amid the expectations of economic stimulation in the eurozone. In the meantime, the IMF downgraded its forecast for the US economic growth in 2012 down to 2%. According to the IMF, the US may need further economic stimulation if the situation keeps deteriorating. Friday’s employment stats are expected to help analysts anticipate the Federal Reserve’s further steps.
As central banks around the globe are expected to keep buying gold, the gold reserves of gold ETFs increased earlier this week. Goldman Sachs expects the price of gold to touch $1840/oz in 6 months. According to WGC, the foreign demand for gold increased by 13% in Q1 2012, thus reaching 389.3 tons. The overall demand declined by 5% during the same period.
Political risks increased after Iran reported about successful tests of missiles, which are able to reach Israel. This resulted in higher gold and oil prices.
US markets are closed: Today is the Independence Day in the USA.
Forecast.
According to the Commodity Trading department of , gold may test 1623-1625, and maybe 1630. If an H1 price bar closes above 1622, it will give way to 1635, 1650. A failure to do that will trigger the bearish scenario, thus probably letting the price 1608-1610, 1600.
Silver may test 28.25. A break and consolidation above 28.30 will trigger a rally up to 28.5, 28.75, and maybe 29.0. A failure to consolidate above 28.30 will intensify the bearish move down to 28.0, 27.75, 27.50.
Nataly Kambur
