ពត៌មាននិងការព្យាករណ៏តំលៃមាស​សំរាប់ថ្ងៃ១៧

Gold Ended Lower- Critical Support Broken- What Next?

17 Dec 2010	1st resistance	2nd resistance	3rd resistance
Today’s resistance US$	1384	1398	1409
	1st support	2nd support	3rd support
Today’s support US$	1358	1347	1333
Today’s pivot point US$	1372

The Day’s Story:

Gold finished lower for second day in a row on Thursday as end of year profit taking and book squaring continued to put pressure on bullion’s prices. U.S dollar ended marginally weaker after a day of sharp gains, offering little help to gold prices. Most other markets have been trading in a similar manner ahead of holiday season. U.S treasury yields which rose to their six months high a day earlier continued to lure investors, taking some of the shine away from precious metal. Better than expected data from U.S accelerated gold’s losses especially after Federal Reserve Bank of Philadelphia reported a surprise improvement in business conditions. Market was also waiting an outcome of European Union economic summit in Brussels. Some sell stops were triggered, adding to gold’s misery as it fell below its key level $1370. Meanwhile, Commodity Futures Trading Commission is also debating derivative regulation Thursday as well as how to apply position limits to the futures market, which kept new buyers away from precious metal as there seem to be a lot of unanswered questions as to what defines a legitimate hedger vs. a speculator. Gold rose to its record high level of $1431 an ounce last week but have lost $62 since. Despite its recent losses, Gold will come out as a winner over equities, currencies and most commodities at the end of the year in terms of gains.

Stocks in U.S closed at their 2 year highs as we are approaching towards year end when most investors are starting to close up their portfolios. The Dow Jones closed up 41 points at 11499, its highest close since September 8, 2008; S&P 500 finished 8 point higher at 1242.87 while NASDAQ edged up 20 points to finish its day at 2637. U.S stocks rallied earlier in the session at the back of mixed but promising economic data. Labor department reported that Initial jobless numbers fell 3000 to 420,000 while Commerce department reported number of new private home starts rose by 3.9% which was better than analysts’ estimates. Stocks in Europe however, closed mixed with Britain's FTSE 100 closing slightly down by 0.02%, while DAX in Germany ticked up 0.1% and France's CAC 40 closed up by 0.2% to finish the day.

On Wednesday, stocks declined as investors worried about a possible Spain downgrade by rating agency Moody’s. Also on Wednesday, the Senate approved a controversial $858 billion tax package to extend the

Bush-era tax cuts. The gold landscape still seems ripe for safe-haven buying especially with ratings agency Moody's threatening to cut the U.S.'s triple-A credit rating if the new tax cut bill was approved by Congress, which has already become a reality. On the other hand, China’s expected move to hike its key interest rate also remains a lingering worry for gold bulls as any such move by China before year end will be bearish for gold. Analysts however, believe that a rise in interest rate will cause short term correction and will not affect gold prices to a great extent. There are signs that monetary policy might not be as tight as feared. China will probably target about 7.5 trillion yuan ($1.1 trillion) in new loans next year, level with its 2010 target, a leading official newspaper said.

U.S. dollar index ended its day with marginal losses after a day of sharp gains on Thursday. Dollar rose earlier in the session against basket of six major currencies but gave away those gains after the close of gold’s floor session, and pared its advance on the euro after reports that some European Union officials had agreed to change the region’s governing treaty so it would have a permanent mechanism to deal with sovereign-debt problems. U.S dollar’s recent gains are partly because of market’s realization that U.S economy’s outlook in 2011 will be improved as stronger economic reports in recent weeks lifted investors’ confidence. Dollar’s 5 week uptrend on charts is still in place due to some fresh upside momentum gained on Wednesday.

Gold and dollar’s inverse correlation weakened on Thursday as both moved in the same direction.  Correlation between two assets has been erratic this year as both broke away from their organic inverse correlation relationship several times this year mainly due to heightened economic worries at the back of Euro zone debt crisis. Any relief in euro crisis, similar to what were seen during last couple of weeks, will push the euro higher and the dollar lower and be good for gold, as the two move inversely to each other. If a debt crisis flares up again and default is floated as an option for some countries, the euro could plummet in value and take gold with it. Safe haven buying, however, should create a floor of support for gold prices.

Gold prices could be more volatile towards the end of the year (similar to what we have been seeing in last few sessions) as profit-takers contend with "bargain-hunters" and those wanting to add gold to their portfolio before the New Year. During December, those traders selling gold future contracts must also deliver physical gold and the longs must pony up the cash which increases liquidity and volatility in the market. However, the end of the year traditionally brings with it less liquidity and greater potential for rapid shifts in price direction, meaning that gold could endure more setbacks before resuming its uptrend.

Yesterday’s Price Action:

Gold price started its Asian session with minor gains and continued to make its way up during first session of the day although price traded in a narrow range. Gold hit its intraday peak of $1386.2 an ounce in early hours of European trade but pared those gains as European session progressed. Gold fell into red zone by mid- European session. Bullion’s losses were deepened as U.S economic data started filtering in and just before U.S market open. Gold’s losses were accelerated during early U.S session and fell to its intraday low of $1361.3 an ounce. Gold pared some of its intraday losses during later part of the session and finished at $1369.9 an ounce.

Other Metals:

Silver futures for March delivery closed down 47 cent to $28.78 an ounce on Thursday.

Platinum futures for January delivery fell $5.80 to $1,698.60 an ounce on NYMEX.

Palladium futures for March delivery fell $10.10 to $742.55 an ounce.

N.Y. Copper for March delivery closed down 2 cents $4.12 a pound on Thursday.

Gold (News and Views):

      February Comex gold closed down 15.20 at $1,371.00 an ounce on Thursday.

      The London P.M. gold fixing was $1,363.00 on Thursday compared to its previous P.M fixing $1,383.75.

      The world’s largest gold exchange-traded fund, New York’s SPDR Gold Trust, said its holdings fell to 1286.187 tons on December 15 down from 1286.794 on December 14th.

      The dollar index, which measures the U.S. currency against a basket of six major currencies, fell 0.18 to 80.02 on Thursday.

      Crude Oil for January delivery fell $0.92 to $87.70 on Thursday on New York Mercantile Exchange.

      Gold hit its true peak on Jan. 21, 1980, when it rose to $825.50 an ounce. Adjusted for inflation in 1980 dollars, that translates to an all-time record of $2,184.08 an ounce, in 2010 dollars.

      In the COMEX futures markets, speculative buyers have increased net longs, or bullish positions, by 2.3 percent in the week to Dec. 7, while silver's net longs dipped 3.2percent, CFTC's weekly Commitments of Traders report showed.

Factors Affecting Gold Price Yesterday:

Much of the weakness in gold Thursday was the result of long liquidation, says a research note from MKS Finance. Sell stops, which are pre-placed orders triggered when certain chart points are hit, accelerated the decline. The U.S. dollar has had a stronger tone recently, particularly amid worries that a European summit won’t come out with clear solutions to the continent’s debt crisis, MKS says. This prompted some liquidation in gold, and another possible reason for selling was news about new CFTC rules on position limits, MKS says. Nevertheless, market participants used the price dip as a buying opportunity, enabling gold to bounce off its weakest levels.

“With the end of the year coming up, individual and institutional investors are attempting to book profits and take advantage of another great year for gold,” said David Beahm, vice president at Blanchard & Co., in New Orleans.

“The other thing hurting gold is the strength of the dollar. There’s still a lot of concern about Europe,” said Frank Lesh, broker and futures analyst with Futurepath Trading in Chicago.

“Any time you have regulators talking about limiting speculation, you have some big players stay out,” Lesh said. “Maybe that’s why you’re seeing the market more dominated by short-term traders.”

The Treasury yield is certainly pressuring gold prices," said Bruce Dunn, vice-president at Auramet Trading in

Fort Lee, New Jersey. "It's also near month-end, quarter-end and year-end and people are looking to take profit as the euro continues to weaken and the debt crisis drags on."

Gold Future Outlook:

.”Despite today’s long liquidation, we expect gold to pursue the upward momentum in the short term, as the euro zone's debt crisis along with the still weak U.S. economy are likely to be of a good support to the gold prices into the first quarter of next year,” MKS says.

SEB Commodity Research sees profit-taking weighing on gold above $1,400 an ounce in the short term, but holds a bullish tactical view. The European debt crisis is likely to heat several times before a resolution, thus a new peak in “fear” is likely during the first half of 2011, says a research note from Filip Petersson. Resulting strength in the dollar could hold gold back some, but this would be limited by further “money printing” via quantitative easing, SEB says. “Thus, we expect new highs in gold in H1-11,” the bank says.

SEB says “confidence in Spain is hanging in a thin thread and if European leaders are unable to show any signs of progress when they meet today and tomorrow, the thread will be even thinner. We doubt that we will see resolute action at this time and thus hold on to our bullish tactical view.”

Gold remains in a trading range but is above five-month rising channel support at $1,374 an ounce, say technical analysts with Barclays Capital in a research note. “Near-term direction is fading as momentum studies begin to drift sideways,” Barclays says. Still, “in the absence of a strong downside signal, we stick with our bullish view” and look for a resumption of gains toward the $1,432 peak, extending to resistance in the $1,460 to $1,480 area, Barclays says. The latter two levels are a 1.382 Fibonacci projection and channel resistance.

“All the factors that have driven gold higher -- the uncertainties, commodities as an asset class, gold as the ultimate currency -- I don’t see that changing significantly” said Bill O’Neill, a principal at Logic Advisors in New Jersey.

The second half of the year is harder to predict, with one potential setback coming in the form of surging interest rates in Europe and the U.S., he said. Much higher interest rates would push investors away from gold, which bears no interest, pays no dividends and thus carries an opportunity cost.

The market could absorb higher interest rates over time, “but no surging interest rates,” he added. O’Neill sees gold hovering around $1,500 an ounce next year

Technical Analysis (by Jim Wyckoff):

Technically, February gold futures market bulls still have the overall near-term technical advantage, but are fading and need to show fresh power soon. The bulls do not want to see a bearish weekly low close on Friday, which would produce near-term chart damage and begin to suggest that a near-term market low is in place. A 4.5-month-old uptrend is still in place on the daily bar chart.

Bulls' next near-term upside technical objective is to produce a close above solid technical resistance at this

week's high of $1,408.90.

Bears' next near-term downside price objective is closing prices below solid technical support at $1,350.00. First resistance is seen at 1,380.00 and then at Thursday's high of $1,387.30.

Support is seen at Thursday's low of at $1,361.60 and then at $1,352.00.

Wyckoff's Market Rating: 6.5.

Daily Gold and Silver Expected Range:

Gold: US$1352- $1387

Silver: US$28.15 - $29.55