Gold and silver bounced back yesterday and sharply inclined after they had fallen in the past three business days. The speculation around the upcoming speech of Bernanke may affect trading in the commodities and Forex markets throughout the day. Many also anticipate tomorrow’s German voting on another bailout package for Greece that could ease the uncertainty in the financial community over the stability of the Euro Area. Today, the U.S. Core Durable Goods report will be published.
Gold and silver shifted to green and increased yesterday: Gold added on Tuesday 2.74% to its value to $1,652; silver increased by 5.20% to $31.52. During September, gold fell by 9.8% and silver decreased by 24.5%.
USD/ Precious Metals – September Update
The EURO/USD along with other exchange rates rose yesterday: the Euro/USD gained 0.38%; the AUD/USD added 0.82% to its value. The recovery of the major currencies against the USD in the past few days over the new hope of the German Parliament approving the bailout program for Greece tomorrow; many think that this rally of the Euro won’t last long. But for now, this rally in Euro and other currencies may contribute gold and silver to halt their falls.
Gold and Silver Outlook:
Gold and silver changed direction from the falls in the past three days and increased. The hike in the US stock markets and US securities yields might suggest that trader shifted in the past few days from bonds to the stock market; this might be stemmed from the speculation around of European policymakers approving the bailout program of Greece. These events may affected gold and silver to trade down. On the other hand, the correction in the precious metals’ market for the CME margin hike seems to be over, and now with the low rates of gold and silver, traders are slowly returning to the bullion market. By the end of September I still speculate that gold and silver will slowly recover from their sharp drops in the past few days, but will finish the month well below their initial price level from the beginning of September.
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Lior Cohen, M.A. commodities analyst and blogger at Trading NRG.
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