comex gold outlook

Gold : Weak Dollar, firm Oil bring in investment demand
30 June 2008 10:23:24



Gold extended gains on Friday, as investment demand of the yellow metal increased with the dollar remaining weak and oil prices surging to a new all-time high near $143 a barrel.



International spot gold traded as high as $930.40 and last quoted at $927.14 ($916.25). On weekly basis spot gold gained $26.30, approximately 3%.



Official data that showed a 10.1 percent decrease in South Africa’s gold production in April 2008, compared to the corresponding month in the previous year, supported the bullion.



Dollar extended the decline since the Federal Reserve left interest rates unchanged at 2 %, as economic fears persisted amid mixed data from various sectors and upside risks to inflation.



University of Michigan’s consumer sentiment index fell to 56.4 in June, the lowest level since 1980, from a reading of 59.6 in May.



Initial claims for US state unemployment benefits were unchanged at 384,000 in the week ending June 21, the Labor Department reported Thursday. But the four-week average of those claims rose to 378,250.



The National Association of Realtors reported Thursday that sales of existing single-family homes and condominiums edged up by 2 percent to a seasonally adjusted annual rate of 4.99 million units in May.



But the sale of new US single-family homes tumbled 2.5% in May to a seasonally adjusted annual rate of 512,000, according to the Commerce Department. Compared with a year earlier, the new-home sales were down 40.3%.



Meanwhile, the US Commerce Department in its final revision to GDP estimates said Thursday that the economy grew at a slightly faster pace in the first quarter than originally reported. Real GDP was revised to a 1.0% annual rate in the first three months of the year, up from an originally reported reading of 0.9%.



The US Consumer Confidence fell in June to a 16-year low. According to Conference Board, June consumer confidence index fell to 50.4 from a reading of 58.1 in May.



The US trade deficit had widened 7.8% in April to a seasonally adjusted $60.9 billion from $56.5 billion in March, according to the report by US Commerce Department. The growing deficit was driven by a surge in crude oil imports, which eclipsed a significant gain in the nation’s exports.



The recent data from various sectors in the US have given rather mixed hints regarding the economy.



Oil prices rose to near $143 a barrel yesterday for the first time ever, boosted by comments from the OPEC President and a threat from Libya to cut its crude output. Short-term supply concerns due to geo-political tensions in the Middle East and Nigeria underpin the prices of oil.



Weekly Outlook (Spot Gold)

Continuation of uptrend is expected above $932. Supports are $922, $913; resistances $945, $954.



Last day DGCX Gold Aug traded in the range $912.60 – $932.70 and closed at $928.70 ($919.50).





DGCX Gold August

TECHNICAL OUTLOOK (Intra-day)

GOLD (Aug) - Bullish above $ 928; bearish below $ 923


MCXARUN
9994500540