Ben Bernanke is expected to make a speech on August 31st 2012. Judging by the current situation most investors will use this event to play the rumors about QE3. They say “Buy rumors, sell facts”. Nobody expects Ben Bernanke to announce QE3. However, they will be looking for hints. Such steps are taken during FOMC meetings. This factor along with positive US economic stats mad most investors to hold their horses yesterday, which resulted in gold prices going down a bit.
The ECB is reported to press international banking regulators in order to ease borrowing conditions. In particular, the central bank wants to make the regulators allow the use of asset-backed securities as guarantees. This step is clearly aimed at ensuring higher liquidity amid the eurozone crisis.
In the meantime, the Japanese government has downgraded its economic forecast for the first time since October 2011. The major reasons include the eurozone crisis and China’s economic slowdown. A possible decline in domestic consumer spending is also a major concern for the authorities. Domestic consumption accounts for 605 of the Japanese economy. The Bank of Japan is to hold another meeting on monetary policies on September 18th-19th 2012.
Meanwhile, Israel keeps preparing the local population for a possible armed conflict with Iran. This factors increases political risks.
Today’s forecast:
According to the Commodity Trading Department of , gold is expected to test the support around 1661. On breaking below the level, we may see the price testing 1650, 1640. Alternatively, a failure to stay above1661 will give way to 1673-1675. If an H1 price bar consolidates above 1674, it will increase the probability of rallying up to 1690.
Silver is expected to test 30.50. If an H1 price bar closes below the level, we may see the price testing 30.25, 30.0. A failure to stay below 30.50 will give way to 31.0-31.05. A break above 31.05 may start a rally up to 31.25, 31.5.
