Gold - Technical Study - Weekly Charts

Weekly Outlook on Gold, Gold has broken the Triangle, clearly shown in the Chart.
RSI is low as well, and is favorable.

WE ARE LOOKING FOR NEW HIGHS BY END OF THIS YEAR. With more investment coming in towards Precious Metals, and as always 4th Qtr of the Year is in Rally, with Much Physical Buying occuring as well.

Crude Oil Update

Prices were easier in Asia on further signs that the US economy is weakening and on forecasts of warmer weather as winter approaches in the northern hemisphere, which are seen cutting demand in a well-supplied market.

The New York Mercantile Exchange's main contract, light sweet crude for December delivery, was last at $58.59 a barrel, $0.14 lower than its close of $58.73 in the US overnight.

FOREX ASIA UPDATE - USD

The US dollar fell sharply overnight on the back of softer-than-expected US consumer confidence and Chicago PMI data, with EURUSD trading up to a high of 1.2783 from a low of 1.2679, while USDJPY traded down to a low of 116.62 from 117.93.

In response to the economic data, 2 and 10-year Treasury yields slumped by 6 and 7 bp respectively, and are now down by around 15 bp over the past week, helping to explain the soft USD.

Interestingly the implied yield on the Dec-07 Eurodollar contract is almost back at its September lows, but March is still well of the September lows, implying that that the market thinks the Fed will take its time before starting the rate cutting cycle, but then cut quickly.

The Conference Board consumer confidence index for October fell to 105.4, less than consensus of 108.0 from an upward revised 105.9 in September. Meanwhile, the volatile Chicago PMI for October fell by more than expected to 53.5 in October against consensus of 58.0 and from 62.1 in September.

The market has been sensitised to any suggestion that the softening in the housing market may affect the broader economy and as such the downward surprise in consumer sentiment is a negative development for the USD.

However, the index is relatively unchanged from the previous month and we would be wary of calling for further near-term USD strength at current levels, and indeed we expect the USD to trade back to the high end of its recent trading range.

Todays Data - manufacturing ISM for October is due at 1500 GMT, with the market expecting little change from the 52.9 reading in September.

SWING LOW - Confirming Uptrend in Gold - TECHNICAL

New Low is Higher than the Previous Low,
We have seen a Swing Low.
Gold has crossed the technical Resistance Barriers, and is aiming for Upwards.

Our team forecasted earlier for a Reversal at 572, that reversal is completed, and Down push seems over, as more Buyer/Investors are coming on the table.

Looking at History, every 4th Qtr of the Year we have seen Solid Push, Nov - Dec, we are looking for a nice Solid Increase in Precious Metal Prices.

North Korea Update

North Korea has agreed with China and the United States to return without preconditions to six-party talks on eliminating its nuclear weapons, the Chinese Foreign Ministry said in a statement on its website.
US negotiator Christopher Hill later said Pyongyang had agreed to return to the talks as early as November without conditions.

Dollar Weakness All Across the Boards -

Dollar weakness is all across the Boards.
EUR/USD flying up the high and aiming for 1.2830 in few days time.
Crossing 1.2765 resistance zone.
Currently trading 1.2779

USD/JPY trading at 117.06 levels, meeting 116.5 levels in few days. Coming down around 38 Pips.

Gold Pushing Up higher, after trading in Negative territory today, before the Economic Data, where traders had there focus.

We mentioned earlier today, we would see gold going 599, and Bounce shall emerge, which is what we saw, and Gold shall be pushing higher soon targeting again 610 levels.

Silver is following the Gold lead.

US Data out

Chicacgo PMI 53.5 vs 58.0.
Consumer Confidence 105.4 vs 108.0
Slam on Dollar
EUR/USD Spiked towards 1.2742 levels
Precious Metals getting Support

North Korea Update

Wire reporting US official confirming US envoy met N Korean official in Beijing and N Korea agreed to return to talks. Adds that US hopes for new round of N Korea talks by year's end.
- US says implementation of UN sanctions on N Korea will continue.

North Korea Update

Chinese Foreign Ministry reported saying that Six-Party talks to resume at convenient time soon.

North Korea Update

N.Korea has agreed to return to Six-Party nuclear talks

Gold Update

Gold is standing nicely at the Support level we mentioned in Asia Morning 599, where it bounced after touching it.
There is a heavy Dollar strength which is pushing prices downwards, but we are seeing nice investors demand arising, keeping the prices steady. Such dip was required for technical correction, and start the rally upwards, Prices should be some what near $600.
Traders focus on Chicago PMI today coming out at 15:00 GMT. Important data, which shall set the trend short term.

Lower Oil Helps Dollar - FOREX UPDATE - USD

Lower oil prices help dollar: The USD was stronger across the board overnight, although there was little by way of pattern in the distribution of currency moves. EURSD traded down to a low of 1.2699 from 1.2734, while USDJPY traded up to a high of 117.56 from 117.21.

The USD may have been helped by a sharp decline in oil prices, which fell by around 4% yesterday, with the Nymex crude benchmark futures closing at US$58.38, down from US$60.75 on Friday.

The declines appear to be driven by the view that OPEC producers will be unable to make the production cuts necessary to stabilise oil prices.

The core PCE prices rose 0.2% m/m in September, in line with expectations and the y/y pace slowed to 2.4% from 2.5% in August. While USD risks are very much to the downside over a 3-month time horizon in our view, we suspect the USD will find its feet in the near-term, and could mount a recovery back to the higher end of its ranges. The very healthy environment for carry trades, which was a key element in USD's ability to hold up well in September despite a big loss of rate support, remains pretty much intact, with our FX Risk Index continuing to hover in very risk-seeking territory.

Moreover, while we agree with consensus expectations that this week's key slate of rather more forward looking data, including the ISM report and the employment report, will be consistent with a slowing pace of activity, the market would be sensitive to upside surprises which might signal that Q4 was starting out stronger than a sluggish Q3.

Looking ahead, and the employment cost index for Q3 is due at 1330 GMT and the Chicago PMI and the Conference Board's consumer confidence index are both due at 1500 GMT.

Gold Update

Gold is currently doing a Technical correction, and little profit taking occuring in Asia Zone for the moment.
Gold should be able to hold above 599, and our Initial Support is also at 592.20 levels.
A 5 days continous rally, needs a little correction, which is what we are seeing right now in Asia, with a slight dip on the boards.
However, we are just seeing it as technical correction, overall, market did crash the resistance late Monday, which has open the channels, A mini-correction is taking place, and profit taking.
Investors pressure still remains,
We should see Profit-taking in Asian side today.

Precious Metals Update

Precious Metal saw little Profit taking, earlier today when Gold touched 610 levels and Silver 12.24, it both fell, but staying above its Daily Chart - MA -200.

Gold Should stay above 603 levels, however, gold is in Bullish frame right now, And Silver clearing its All Resistance levels earlier.
We will now see a nice good movements in Precious Metals, And we mentioned last month, if we take history 4th Qtr of the year is a term of a Nice Rally..

Gold Should close above 606.50 levels

Spot gold has broken above the Sept 28 high at $606.50 to post a high of $610.50/oz before easing back slightly.

The precious metal will need to close over $606.50 for upward momentum to build.

Gold is being buoyed by a weaker dollar, recently firmer oil prices, and renewed customer demand, Given the more bullish sentiment across the commodities spectrum the metal appears to be making a challenge of the pivotal $607 chart line and 100-day MA at $607.90.

A successful breach, which is the likely outcome this time, has the potential to generate fresh interest from investors as well as speculators and will lead gold back to the $617-620 area initially before targeting $645.

Gold topped out at $640.00 in early Sept before hitting a low of $559.40 on Oct 4.

Gold Update

Gold Aims for higher, clearing all the resistance, and as we mentioned earlier, for the momentum boost in the prices.
We are welcoming 617 price on the table again.

FEDs Lacker saying

FED's Lacker is out speaking saying "Maintaining prices stability is best thing Fed can do for growth." Lacker dissented in FOMC voting to send message on inflation expectation dangers

GOLD Pressures Channel Resistance At 604.55

Gold has continued to strengthen and is pressuring channel resistance at 604.55.

Momentum conditions are still fairly neutral so it will be key to see whether the metal can follow through on the break of the channel to avoid any concern of a false break.

Continued gains would pave the way for strength towards 607.01 initially, Sep 28 high where a break would pave the way for 618.24. The latter level is the 50% retracement of the 676.35 to 560.13 decline.

Key support has now been defined at 573.50 where a break would instead confirm a return to weakness. Initial support lies at 592.20, the Oct 27 low.

A clear break of the channel would confirm potential for 618.24 - maintain cautiosly bullish outlook.

North Korea Update

North Korea is expected to conduct a second nuclear weapons test, General B. B. Bell, head of US forces in South Korea says, XFN reports. "I think we can expect further tests as part of its program to develop very provocative weapons," Bell told a press conference. If North Korea attacks South Korea, "we would quickly and decisively defeat aggression," he said. Bell said the United States would use "all means available" to deal with aggression.

FOREX ASIA UPDATE - USD

The US dollar fell sharply on Friday on the back of soft Q3 GDP, with EURUSD trading up to a high of 1.2751 from 1.2671, while USDJPY traded down to 117.13 from 118.53. Advance Q3 GDP rose by just 1.6%, well below market expectations of 2.6% annualized, while the core PCE deflator also rose by a less-than-expected 2.3%. Economists warned that the report was likely weaker than what the headline suggests.

In particular GDP was boosted by an unlikely surge in motor vehicle production. It's a heavy data week in the US, and in general we expect releases to be consistent with a further gradual slowing in activity, weakness in the housing market and muted price pressures.

Non-farm payrolls on Friday is the major focus, and our economists project 105k, below non only trend, but also consensus at 125k. The data should support our view that the Fed is on hold and will ultimately cut rates next year, but markets are likely to be cautious about pricing too much more easing risk just yet given Fed commentary continues to stress inflation risks.

With the global environment for carry trades remaining quite healthy, we think the USD will remain reasonably well supported this week even if data supports perceptions of slowing activity.

Looking ahead to today's session and Fed's Lacker speaks at 1330 GMT on the topic of "Monetary Policy Tactics and Strategy", while Fed's Moskow speaks at a conference on education and economic growth at 1415 GMT.

Gold Update

Gold Aims for 604 levels, It should cross 607 Level as well, before that we need to see how it clears from 603-604 levels, where we have seen heavy resistance.
However, the smoothness, and the nice pressure flowing, we see the Bottom touch has finished, and with New Week starting commencing with New Month, we see a Push in Precious Metals Prices is definately on the boards. And New Investment shall Supply inwards.
With little Economic Data today, we will see traders reaction in the market, with no Economic News intervention.
Technical Picture is Solidifying for Precious Metals, and if we see Crude Oil is Pushing upwards, with threats appearing in the Gulf region in relation to possible attacks in Oil related fields.
However, not solid Asian movements in the market, we need to see reaction of European/NY, which shall emerge a much clearer picture.

For the moment looking in Asia, the traders are eager to Push the prices upwards.

Crude Oil - Terrorist threat

Wires report Saudi Arabia confirming 'terrorist threat' to economic installations

Gold Technical Update

Gold Technical Update - 1 Hour Chart.
Gold is forming an Uptrend,
However 603 level is Heavy Resistance, it needs to clear that level, to push higher.

For more information email at owaissivany@yahoo.co.uk

SUPERB!!

A very Superb Week for all the clients/traders
Earlier this week we targeted 572 bottom, though it reversed 572.8 levels, and getting long from there, and exiting at 598 - 600 is a good profit for everyone.

Our Analysis team is 24/7 ready to help you, feel free to drop email.

Gold Update

Gold Pushing higher after emerging little profit taking before GDP.
We still aim $600, as we mentioned earlier last week, it will try again, And after a nice reversal from 572 we analyzed.

As we just speak gold touched $600

Precious Metals Update

Market Awaits for the US GDP figures coming out at 12:30 GMT.
Precious Metals still in Bullish triangle, reacting with Crude Oil prices, however markets waits for the Important US Economy Data releasing today, which can fulfill the short term trend.

Energy Futures Update

After yesterday’s rejection at the $61.70 for WTI Crude Oil level the picture is looking a bit gloomier for Oil under the 60.30 level.
Trading now around $60.00, any weakness on the US GDP below the 59.40 strong support and Oil would slide back towards $58.50.

FOREX EUROPE UPDATE - USD

The US dollar has stayed weak in Asia, trading in a 1.2686-1.2715 range against the EUR and a 118.33-118.73 range against the JPY this morning.

The USD was further undermined yesterday by US economic data. While new home sales rose in the latest month, the volatile median house price index plunged 9.7% y/y in September, raising fears that the housing market will inflict damage on the broader US economy.

In response US two and ten year yields were both down by 4bp, although the equity markets finished in positive territory, partly aided by a strong bounce in overall durable good orders. Total durable goods orders surged 7.8%m/m versus consensus of 2.0%, but the surge was entirely due to volatile civilian aircraft, and core durable good orders declined on the month.

Overall the USD has been undermined by a combination of a hawkish ECB in response to rising European inflation expectations and concern over the US growth outlook in light of the weak housing data. But the environment for carry trades remains sound and the latest indications this morning suggest that the BOJ will not turn overtly hawkish in its semi-annual Outlook report released on Tuesday.

Q3 advance GDP is due at 1230 GMT and the market expects a 2.0% annualised rate versus the 2.6% growth rate for Q2. The GDP data show how the US economy has slowed as the housing market has weakened. But we don't expect the Fed to cut interest rates until March next year.

Crude Futures Update

We keep a neutral stance after yesterday rejection and before the US GDP, capped @ $61.00 today, though still bullish on a daily as long as we stay above $60.10.

US GDP will give the trend for the near term.

Market Buzz

USD weakness in front of the GDP release today. Is the market overly pessimistic – expecting only 2 percent growth annualized? GDP Price Index expected to decline to 2.8%. That might be too low… Watch out for downside in Fixed Income.

Stock market volatility extremely low and trend continues higher. No retracement in sight for now.

Gold Update

Its all Profit taking occuring right now, and emerging new Buying Opportunities.
We still head for $600 very soon.

Oil Update : Kuwait cuts 100,000 barrels per day

Kuwait will cut its crude oil output by 100,000 barrels per day, to conform to OPEC's recent decision to lower production by 1.2 mln bpd from Nov 1, the official news agency Kuna cited a Kuwaiti oil official as saying.
Kuwait currently produces 2.6 mln bpd, compared with its OPEC quota of 2.247 mln. It controls 10 pct of the world's proven reserves.

US Data - New Home Sales

Market awaits for New Home Sales coming out at 14:00 GMT

Updated Report

Yesterday we mentioned a good trade on Crude Oil, Silver Futures, all in good profits and meeting the targets as we mentioned.
Few Days back we analysed for Gold ans its meeting our target $600+ Again, from the bottom we analysed 572 levels.

FOREX ASIA UPDATE - USD

The USD was softer overnight as the Fed left rates unchanged at 5.25% and the statement basically unchanged, although soft housing market data was probably more responsible for the weakness in the currency.

EURUSD traded up to a high of 1.2623 from a European session low of 1.2558, while USDJPY traded between 118.88 and 119.36.

The Fed said that core inflation had been "elevated" but would ease due to less impact from energy prices and said that inflation expectations were contained.

Interestingly, the Fed appears more confident that the brunt of the slowdown in the US economy associated with the housing sector is probably over, and said that economic expansion was on a solid footing. More important for the markets overnight however was existing home sales, which declined by 1.9% m/m, versus expectations of a 1.2% m/m decline.

We think that the market is unlikely to return to pricing in rate cuts by the Fed and the near future, and correspondingly the USD should maintain a firm tone.

Todays Economic data, durable goods are due at 1230 GMT. The market expects a rise of 2% m/m, and improving global growth expectations should help to underpin the USD. Other data due today includes jobless claims also at 1230 GMT, and new home sales at 1400 GMT. Fed's Geithner speaks at 1300 GMT on "The Implications for Central Banking of an Evolving Global Economy", but he is unlikely to make any comments concerning near-term monetary policy.

Gold Update

As we mentioned earlier, that gold will hit again $600 levels, it heading towards there now, we mentioned earlier that gold will hit 572 levels and reverse, and this is what its performing right now.
We look ahead for it to push higher, with Crude Oil Pushing upwards right now, and Dollar weakness helping the precious Metals, and with FOMC meeting out of way, clears the path.

Energy Futures Update

Although the weekly inventory data is expected to provide some short term volatility, we do not expect that the market will be able to sustain a break of the 59.00 level.

That being said, 59.00 - 60.00 is still the middle ground and a sustained break through the 60.00 level is needed, too, to make fell a little more confident on the longs.

Dec WTI crude futures rallied as the UAE announced 5% export cuts, easing doubts of whether OPEC members would or even would have implement production cuts.

Treasuries Update

Initially, the market will be focusing on the Existing Home Sales, the real event today is the FOMC statement.

However, traders will be keeping an eye on the Existing Home Sales, because if they do not show the same stability as has been seen in Housing Starts, then housing market bulls will have to rethink their projections. This could provide some short term volatility to markets ahead of the announcement.

The meeting today is, once again, all about the tone that is adopted. We are market neutral going into the announcement, and will react to any change in tone by the Fed.

Precious Metals FUTURES Update

Precious Metals found their feet yesterday, putting in a strong reversal counter the market sentiment. However, today’s trade will center on the FOMC announcement later on in the session.

The negative sentiment on the dollar provided some lift to metals and will continue to provide support against further weakness. If you are trading gold and silver, then you have to keep one eye on the dollar, especially around FOMC. Once again, the tone on the statement will set the direction of the market.

Updated Report

We have an Update report, there are some fund managers Investing in Precious Metals, as its a good buying Opportunity.
We are also seeing Crude Oil pushing upwards, however todays Crude Inventories can shake it a little bit, and there is confirming news that OPEC production cut, is definately being taken place, so we could see a rise in Crude Oil.
Overall, USD is weakning, if we see the US Index, its lying around resistance level, and pushing downwards.
Geo-Political tensions have started to cool down a little, however we see Iran and NK issue to come up again, as its been a little quite these days.
OverAll, we see nothing Panicky, or worrying, its just giving it a little time.

MAIN FOCUS TODAY IS FOMC.

Silver Futures Trade Key

Silver futures are looking to shine, with a yesterday push upwards, As it appears both Gold and Silver has done there Bottom, and looking for a Reversal upwards.
Could be a nice trade at Buy 11.80, Stop 11.55, Target 12.12 & 12.60

Trade FX, Commodities and much more

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Crude Futures Trade

We are looking for Crude Futures to push upwards, as they are at bottom.
Could be a nice trade at Buy at 59.60
Stops at 59.00, Target 61.40 & 63.20

FOREX UPDATE - USD

The US dollar consolidated earlier gains overnight, posting a 1.2551-1.2574 range against the EUR and a 119.14-119.44 range against the JPY. The AUD jumped to a high of 0.7613, following the release of local consumer inflation data for the third quarter with Australian's Treasurer Costello warning to be vigilant on inflation. "Growth trades" such as AUDCHF or AUDJPY should continue to do well, while during peak global growth the USD also appears well positioned for further gains.

We think housing market and GDP data due later this week will challenge the notion that the Fed could hike again and be consistent with easing next year. However, with the Fed likely to maintain its somewhat hawkish message in the statement following its meeting conclusion today, markets are likely to be cautious about rebuilding easing expectations. Also, while the wealth effects of rising stock markets should not be overestimated, rising stocks will help to delay the projected weakness from housing.

Ahead today, the FOMC should release their decision at 1815 GMT. As mentioned above we are not expecting any changes to the statement.

Gold Update

Gold went as we analyzed. where it bounced from 572 as we studied earlier today morning.
Gold trades now 580+
There are a chance of reversal being developed.
Tommorrow is a Big day as traders await for FOMC Meeting.

For further information, feel free to drop our Analysis team email.

Gold Update

We Mentioned earlier today, if gold passes below 580, We will see 572, and will see reverse push upwards,
which is currently what happening right now.
We will see it push upwards.

FOREX ASIA UPDATE - USD

The US dollar was stronger overnight on the back of a couple of articles playing down scope for the Fed to cut rates in the near future. Most of the price action occurred during European trading hours, with EURUSD trading to a low of 1.2537 from 1.2617, while USDJPY traded to a high of 119.38 from 118.75.

Treasury yields rose, with the 2-year up 3bp to 4.91% and 10-year up 4bp to 4.83%, while equity markets managed to finish in positive territory despite tighter Fed expectations.

An article by Greg Ip in the Wall Street Journal argued that there are some reasons why the Fed might be on hold for longer than in 1995, when the Fed began its easing cycle FIVE months after the tightening cycle ended. Also a Bloomberg article suggested that the Fed's internal estimate for potential growth had been revised down, the implication being that the US will record higher inflation for any given level of economic growth.

Our basic premise this week has been that the FOMC is unlikely to provide any catalyst for expectations of a near-term Fed easing.

Meanwhile, the carry trade environment has not really deteriorated that badly, and if yields in the US are stable or rising, then we should see some upward pressure on the dollar over the short-term.

Looking ahead the economic calendar is limited to second-tier data on Tuesday, with the weekly store sales indexes and the Richmond Fed manufacturing survey.

Gold Update

Gold has pushed towards 580.
We dont see any heavy downward push.
The Only reasons are traders are just getting prepared for FOMC meeting this week, and they just thought to close Positions, however, we have a report many Big Funds still have Long Positions in Precious Metals.
Another reason, we saw a little down push in Crude Oil, and Dollar strength (this is ONLY reason for FOMC meeting, no Economic News or such).
So we dont see anything Panicky.
And we are still looking for 600 very soon
580 level is holding good support, If we fall below it, we will just look for 572 level, and push upwards.

Precious Metals Update

Gold has pushed heavily down-wards, there is no economic relation to its, its due to various factors which we saw today, regarding Crude Oil hasnt effected much rising above $60, after suprise crude Oil OPEC cut. Dollar Strength today. Pushing around 73 pips downwards for EUR/USD to 1.2543.
We also have FOMC rate decision this week, so main focus is over this for the moment, Many expect fed could hike, and thats why we have seen dollar strength in relation to pushing precious metals down, However, we didnt see big fall, as geo-political and physical buying support remains.

580 level mantains a good support which should hold the Gold prices

OPEC Update

Senior OPEC delegate reported saying,
- Saudi has told customers in Asia and US it will cut output by 380,000 bpd from Nov1
- Other OPEC producers will cut from actual oil output from Nov1 under OPEC deal.

IRAN UPDATE - No intention to suspend Uranium Enrichment

Iran on Saturday reaffirmed it has no intention to suspend uranium enrichment and invited Western powers to return to negotiations over its sensitive nuclear programme, Asain news channels reported.

This news should support the precious metals.

Gold Update

We should see Heavy Physical Buying this week due to Festival season this week considering Eid.
It appears we should see it crossing soon over $600, and try again to cross 602.50.
Once Again its important to keep good Stop Order Positions, to mantain any Minimal loss if the price starts falling, which is Unlikely at the moment, as at the moment there are many factors which should help Precious metals.

TECHNICAL - GOLD

It is important for gold to push above 602.50 and 606.50 to Form a New Bullish Triangle, and Aim for 640 level.
It tried today but failed. And we know it will try again.

Precious Metals Update

The November Crude Oil is little lower today and Dollar is in Strength today.
However we should not let Gold go below 592/3. Or we would come in to Bearish tone again.
At the moment Gold is stuck in a tight range of 593 - 602, Which its having hard time to cross 602.50 levels, Where Heavy resistance is being lied.
It tried today, but failed.
And NK news today also pushed it slightly downwards.
We arent seeing a heavy push down, Or any sign of Weakness, or else, we would be already below 590. So things are balancing out here.
Some Profit taking, Some reacting over the news, And on other hand we are seeing Physical Demand sky rocking, with Various Islamic, and Other religious festivals coming up.

So Overall things are Balanced up..
Dont guess the Market.
Keep Good Stops over your long Positions.
Never Panick.. And If u lose the Opportunity, dont think to fight back with the market, Make a Plan, Study a little, And go for it.
Any Questions, feel free to Email, one of our Analysis team will be happy to Answer you.

Energy Futures Update

US Energy Secretarty followed OPEC's 1.2 million output cut, with a warning that prices were still at historical highs and market interventions wasnt beneficial for consuming countries such as the U.S.
He also announced that US must cut dependence on foreign energy.
Late thursday OPEC agreed to a suprise decision to cut 1.2 Million barrels/day -
200,000 more than first announced

North Korea Update

Planning no further nuclear tests (Yonhap quoting diplomatic source in China/Rtrs).

This news MIGHT effect the precious Metals to push a little downward

Gold Aim

Gold is Aiming to cross 602.60 levels where 200 MA lies.
Crossing that it has to face 606.50-607 levels, We would then meet 640 soon.
It is likely to see it push Higher, due to continous Dollar weakness on the Board and Crude Oil Pushing higher, with an OPEC production suprise.

Crude Oil Price Jump

Prices jumped after OPEC sprung a surprise production cut of 1.2 mln barrels a day, bigger than what the market was expecting.

New York's main contract, light sweet crude for November delivery, was last traded at $58.99 per barrel, up $0.49 from its $58.50 closing price overnight in New York.

North Korea Update

North Korean leader Kim Jong Il told a visiting Chinese delegation that his country would return to international nuclear talks if the US lifts financial restrictions that have long angered the North, newswires cite a report in South Korean newspaper, Chosun Ilbo. A diplomatic source in China said in the report "if the U.S. makes a concession to some degree, we will also make a concession to some degree, whether it be bilateral talks or six-party talks."

OPEC UPDATE - cut production greater than expected

OPEC has decided to cut production by a greater-than-expected 1.2 million barrels a day. United Arab Emirates oil minister Mohammed bin Dhaen al-Hamili made the announcement at a news conference after OPEC's oil ministers held an emergency meeting in the capital of Qatar. Some members also indicated it was open to further cuts, possibly at the next meeting in December.

US Philly FED a Suprise

US Philly FED was a Suprise came out at -0.7 VS 7.0 Expected
DOLLAR HEAVILY WEAK.
EUR/USD cleared 1.2600
Needs to push higher 1.2615 level, to push upwards.

Precious Metals FUTURES Update

Gold Futures surged @12 to $602 on the Comex Opening.
A Close above $600 would mean a test of 615/620 area in the next sessions, Support at $598.
Silver Futures breaking the $12.00 resistance, Next target $12.30/50

Gold Update

Gold has touched above $600
It should clear 602 and 606.50 levels, to confirm its Bullish Push Upwards.
However continued weakness in Dollar, and push up in Crude Oil, is helping the Precious Metals

Gold Update

Gold should clear 598.70 level, to push upwards to 600+
Or we might see selling again happening.
However, current weakness in Dollar and Crude Oil rally is helping Precious Metals.
Large buy from Commodity funds also helped it.

Crude Oil Update - Kuwait says doesnt expect cut more than 1 bpd

Kuwait Minister reported saying,
- Doesn't expect cut of more than 1 mln bpd

Crude Oil Update - Saudi says OPEC cut effective Nov1

Saudi reportedly says, expects OPEC cut effective Nov1.

Very good news coming, Crude Oil should rally supporting Precious Metals.

Crude Oil Update - Saudi says...

Saudi reportedly says OPEC will publish list of cuts for individual members.
- OPEC aim to balance market.

Crude Oil Update - Saudi says OPEC cut from Actual Production

Saudi reportedly says OPEC cut will be from actual production.

Crude Oil Update - Saudi Support 1 mln bpd OPEC cut

Saudi reportedly says that it absolutely supports 1 mln bpd OPEC cut.Crude Oil Should push up
Helping Precious Metals

Dollar retraced most of its gains.

The dollar has retraced most of its gains made on the back of news that weekly jobless claims fell by 10,000 to 299,000 and to their lowest level since July. The greenback had strengthened modestly against the euro on the back of the data but has since largely given back its gains.
Dollar Weakness is helping precious Metals,
However Market also waits for Philly Fed

Market awaits for Philly Fed

Market Awaits for Philly Fed coming out at 16:00 GMT.
This Data is considerably important and effects Dollar.

US Data out

US Continuing claims out at 2453K vs 2445K expected
Initial Jobless claims out at 299K vs 308K

Crude Oil Update : IRAN

Iran oil minister Vaziri Hamaneh says Iran has been seeking output cut from quota, not production. Crude oil is moderately lower on this, as this is seen as meaningless, and further hurt OPEC's credibility.

Crude Oil - OPEC Update

Algeria minister says cut today likely to be 30-50k bpd
-- To formalize that amount in OPEC emergency meeting today in Qatar
-- Says price of $50-$60 OPEC basket seems to be acceptable for cartel
-- Wants cuts to start at end of November.

OPEC Update -

Attention in the oil market turns to OPEC's emergency meeting in Qatar and the cartel is expected to cut daily output by 1 million bpd in order to stem oil's slide from July's record.

However, reports suggest that the cut remains divided on whether to trim output from its official quota of 28 million barrels per day or its actual output of 27.5 million barrels.

If the cut is from the official quota, it will be deemed as meaningless, and further hurt OPEC's credibility. The last time OPEC cut output was in December 2004, and was also then by 1.0mln bpd.

It looks like crude oil prices to continue its decline given supplies remain ample and prospect of lower crude demand. Risk is now seen towards low $50.00 level or technically to the 200-week moving average at $48.10, given markets propensity to undershoot.

WTI Nymex crude is currently at $57.93.

FOREX ASIA UPDATE - USD

The US dollar was a little stronger in the US session, boosted by stronger housing data and benign CPI inflation, with EURUSD trading down to a low of 1.2501 from 1.2549. As has been typical in recent weeks and months, the lack of clear themes in the market has been fueling investor appetite for risk, and equity markets pushed higher overnight, while high-yielding crosses such as NZDJPY outperformed.

Housing starts for September rose by 5/9% m/m, against market expectations of a monthly decline, although the positive sheen was dulled by a decline in the more reliable and less volatile building permits.

Meanwhile, headline CPI for September declined on the month, but core CPI rose by 0.2% m/m, inline with expectations.

The market has completely unwound expectations of a Fed rate cut in recent weeks and the data overnight will do little to challenge the symmetrical near-term outlook for the Fed.

While the US dollar keeps its high-yielding status and the Fed seems unwilling to consider near-term rate cuts, we expect the dollar to stay firm in the next few weeks before falling again over a three-month time horizon.


Todays Data Release, jobless claims are due at 1230 GMT. Treasury Secretary Paulson speaks at 1330 GMT, but the topic does not seem conducive to market moving comments (he's participating in "Get Smart About Credit Day"). Fed's Poole speaks at 1345 GMT, and the Philly Fed for October is due at 1600 GMT, with the market projecting a reading of 7 versus -0.4 in September.

Crude Oil Inventories bullish for Crude Oil Prices

The Crude Oil Inventories came out just few minutes back
It is bullish for Crude Oil prices, and this will help the Precious Metals prices mantain support.

US Stocks Update - Dow Up 92 points Clearing 12,000

Dow posting early gains of 92 points, Nasdaq is up 17.

Crude Oil: Market waits for the Inventory data

Attention in the oil market turns to the US weekly oil inventory data at 14:30 GMT, where we assume crude oil supplies to rise 1.5mln barrels, in the week ended October 13.
Gasoline supplies are expected to fall 200k barrels and distillate supplies -- includes heating oil and diesel -- seen down 800k barrels.
Refinery utilization probably fell a fourth week to a five-month low of 88.8 percent as plant operators took advantage of weak pre-winter demand to conduct maintenance.

US Stocks - Dow Could break 12,000

Dow 12,000 could be broken in early trading today given the strength in Dow futures which are up 54 at present. Dow ended Tuesday at 11,950.02. Nasdaq futures are up 7.

NYMEX Crude Oil Technical Levels

RES4: $64.00 Failure high 28 Sept

RES 3: $63.30 Daily high 2 Oct

RES 2: $61.30 Failure high 9 Oct

RES 1: $60.15/45 21-day ma,channel top from 28 Sept

LAST PRICE: $58.70

SUP 1: $58.05 Daily lows 13, 16 Oct

SUP 2: $57.86 Intra-day gap from 12 Oct close

SUP 3: $57.22 Low of current move 12 Oct

SUP 4: $56.90 Low 19 Dec 2005 & Daily Bollinger band base

Break below the 5-day moving average at $58.80 has weakened outlook having yesterday failed to break above the 21-day moving average and 18-day channel top -- today valued at $60.15/45 respectively. Whilst these cap, the risk is to $58.05, with gap base at $57.85 and recent low eyed at $57.22. Below here, $56.90 seen as a downside target.

Data React - USD

Dollar gets a boost in the wake of a "strong" core CPI data and as housing starts show growth, but USD gains are limited. Stock futures move higher.

Data Released

US Housing starts 1772 vs 1640 expected
Building Permits 1619 vs 1710 expected

CPI MoM/YoY out at -0.5%/2.1% vs -0.3%/2.3% expected
CPI Ex. Food & Energy MoM/YoY out at 0.2%/2.9% as expected

US CPI Core Index SA (sept) 207.4 vs 206.9 prior

US Datas coming in few minutes

US Datas coming out in few minutes
CPI MoM is expected to rise 0.2% as it did in August
Housing Starts expected is 1640K
Building Permits Expected is 1710K

Gold Update

We Expect some Technical trading as well today.
Gold Crossing today over 598, and pushing upwards to 602+ levels, could slightly confirm a little technical push down yesterday. Todays NY Opening should confirm the movements, which gets open just few minutes before the Economic Data Release.
Crude Oil Inventories today shall effect the Crude Oil Market, in return to Gold as well

Precious Metals Update

Precious Metals in tight range trading, keep tight stops.
Markets awaits for the US CPI figures coming out today, and could be disappointed if the figure does not come strong. However yesterday drop, shows some sign of tight trading and weakness.
Todays Figures is considerably heavy, in-follow with Crude Oil Price, leading the Precious Metals prices.

Main Focus is Keep tight Stops, Wait for Economic Datas, Follow Crude Oil Price for much clearer Idea.
Breaking 598 Opens channels for 602 levels
606.50 triangle broken pushes gold Upwards for a drive ride to 620+ levels.

581/583 is Support Zone.

BOE minutes

BoE minutes show that the Oct. decision to keep rates unchanged was a 7-2, Minutes show some members thought Aug assessment needed more thought... and rate increase would fan markets hope for more.. Sentance & Besley voted for an increase to 5.00%... UK growth still above average.
GBP/USD falling slightly on the dovish minutes

FOREX ASIA UPDATE - USD

The US dollar slipped on a report in the Nikkei newspaper today that the BoJ is planning to tighten its monitoring of carry trades, deeming it as the cause for misaligning the yen further from its fair value.

This shook the market at the tail end of New York trade, taking USDJPY down from 119.01 to 118.38 low. Before the Nikkei's publication, the USD was buoyed somewhat by a mixed data with a stronger than expected rise in the core finished PPI and slightly higher housing market index but a weaker than expected readings for the overall finished goods PPI.

Treasury yields fell on the weaker-than-expected overall PPI but reversed most of the declines after the HMI numbers were released. The reduction in expectations for Fed easing over the past two weeks was an important element in the USD's rally, and price action this week suggests that this source of support could be ebbing.

Also of note, NYMEX crude prices have extended their recovery back above $60 amid talk of OPEC production cuts later this week.

Equities in Asia have responded negatively yesterday and the S&P was off 0.4% overnight. A setback for stocks could curtail the equity inflows that have also boosted the USD so far in October.

Despite the Nikkei report today, we think the market may prefer to wait for the minutes for the September BoJ meeting, which are due for release today, before we could see a more sustained selling of the USD. Otherwise, we remain concerned that any weak US data may still rattle the current perfect soft-landing scenario that is underpinning the USD going forward.

Today, we have September CPI figures and also due today is the housing starts numbers. We also have Crude Oil Inventories, so a Big day for the Economic Datas, which should move Energy Markets, Stock Markets, Dollar (Heavily) And Precious Metals in return (WATCH CRUDE OIL FOR PRICE INDICATION).

North Korea Update

The North Korean military has informed China that it plans to conduct a series of underground nuclear tests, NBC News reported, citing unidentified US officials. A US intelligence official speaking on condition of anonymity earlier told AFP that North Korea could conduct a test "with little or no warning," but a decision to do so would be "as much political as it is technical."
SUCH GEO-POLITICAL TENSIONS WILL HELP PRECIOUS METALS

Gold Update

Gold is appearing to be Profit taking heavily, no Signs of why its being Pushed down.
As we see technically, its being Corrected itself.
581/2 is a Support level for the moment.
We assume, that as NY Spot Closing time comes nearer, we could see price above $590, as traders are profit taking, and could put funds again buying at low prices.

Gold Update

Gold is pushing lower, considering a Profit taking Scenerio, And Market is trying to capture more buyers in low prices, to push higher the Resistance levels as we mentioned earlier.
Keep tight stops in your Long Positions.

Gold Update

Earlier today, gold hit the Resistance 1 Zone 598 level, and couldnt be pushed higher.
It is Important for it to cross this level sooner, to aim for 200 MA and 606.50
Crude Oil is up today above $60, which provides good support for the moment to Precious Metals, and Weakness in Dollar due to Industrial Production, shall mantain the support.

Dollar Dips in news of Industrial Production

The dollar dipped early in New York on news that industrial production dropped more than expected in September. Industrial production fell 0.6% versus an expected 0.1% drop while capacity utilization fell 0.6% to 81.9% versus a consensus of 82.2%.
The euro stood at $1.2544 from $1.2534 late Monday, while the dollar was at Y118.62 from Y119.11 late Monday.
The euro was at Y148.83 from Y149.28 late a day ago.
The dollar was trading at CHF1.2664 from CHF1.2709 and sterling was fetching $1.8710 from $1.8512 late Monday.

Crude Oil Update

Nymex crude futures extend gains for fourth straight session as OPEC ministers prepare to meet in Qatar to ratify an output cut.
While questions over the cut abound, the prospect of reduced OPEC supplies along with increased geopolitical tensions over North Korea nuclear tests have undercut bearish momentum in the market.
Nov crude +14c at $60.08/bbl.
Dec ICE Brent +39c at $62.05.

Precious Metals Update

Gold is coming near to its first resistance level 1 - 598, Crossing that we have 200 MA,
Main key for the moment is 606.50, crossing that is a Good Channel open for upwards.
Main focus still remains on Crude Oil
However it appears, that gold has touched it bottom levels on 4th October at around 558 levels. And technically we are seeing it to push higher, With GeoPolitical : North Korea tension giving it support, and Crude Oil little push upwards, is supporting the prices.
Upcoming gradual Physical Buying flow is a next key as well for price to mantain its Support.
Looking History, we see 4th Qtr of the Year, a nice price Rally, which could be seen this 2 1/2 months to go for a new Year to progress.
We Still Eye closely at Crude Oil prices, which is a Main Co-relation to Precious Metals.
Anyone willing to enter, the key is to keep tight stops, Main thing is not to guess or predict, its to look everywhere, and we are here posting upto date information
Precious Metal traders - Keep a tight stop on your Long positions, as we are coming to few resistance levels, 606.50 is a Main Level to be watched, Clearing that CONFIRMS a bullish push upwards.

Silver Technical OutLook

The rise from 10.59 has extended beyond the 11.77 peak from Sep 28, giving the larger corrective force from 10.47 room toward 12.20.
This level marks the .618 retracement of the large 13.27-10.47 decline, and only a move above it would shift odds away from categorizing the action from 10.47 as a correction.

Initial resistance is nearby at 11.89. There the current rise from 10.59 would equal the distance traveled in the first leg from 10.47 to 11.77.

Looking ahead, a break of mild support at 11.07-a small reaction low from Oct 11-would relieve upward pressure for now, shifting focus back down toward the 10.59 to 10.47 support levels, fro the Oct 4 and Sep 15 lows, respectively.

Upward potential through 11.89 would target 12.20, while a break of 11.07 would take the steam out of the corrective rise.

Precious Metals Update

Precious Metals trading in the Same range.
However the Daily Technical level suggests, we could see a push today, with USD weak today, and crude Oil playing in tight ranges.
The Physical Demand still remains, supporting the metals heavy.
Main Key for gold is
598 Resistance 1
601.7 - 200 MA
606.50 - Resistance 2

US Data out

US Empire Manufacturing (Oct) out at 22.9 vs 11.2 expected.
13.8 Prior

ECB Trichet Speech:-

Urges need for wage, labour market flexibility

ECB Trichet Speech:-

Economic reform lack key cause of EMU GDP lag vs US

ECB Trichet Speech:-

Monetary stability best in long run for jobs, GDP
- Raising eurozone potential growth a priority.

OPEC Update

OPEC reportedly cuts forecast Q4 demand for its oil to 28.69 mln bpd vs previous forecast of 28.86 mln bpd
- OPEC 10 pumped 27.6 mln bpd in Sep, down from 27.7 mln bpd in Aug
- OPEC concerned downward price momentum may persist due to economy uncertainty, slowing demand growth.

ECB Trichet begins speech

ECB Trichet Begins Speech in Berlin on European Economy

Precious Metals Futures Update

FUTURES UPDATE
Gold and Silver followed Crude Oil and broke some important resistances capping prices since the beginning of the month respectively at $585 and $11.55 now resistances. We are looking to reinstate long positions and target $603 and $12.20 short term.
Trade Idea: Buy Gold at $594 to target $603 with a tight stop; otherwise we should retrace towards the $585/583 strong support.

Energy Futures Update

Crude Oil bounced back on the news of an early OPEC Meeting date set for the 19th of October. We said last Friday morning that a daily or weekly close above $58.50 was needed to brighten the picture short term. The buy signal was approached. A pattern of increasing bounces and the OPEC meeting should put a floor to the price. The downside looks limited and we are looking for a relief rally and opportunities to put long positions and target $61.30 and $64.00 in the near term.
For those not afraid of volatility NatGas offers an interesting Risk-Reward. Buy $5.70/5.80 Target $6.20 and $6.60. Stop below $5.60.

Forex Update - USD

The US dollar has started the week staying firm against the majors, trading in a 1.2490-1.2510 range against the EUR and a 119.65-119.80 range against the JPY this morning in Asia. Low risk aversion and receding expectations that the Fed will cut rates in the near term continue to help the dollar.

On Friday retail sales excluding gasoline and autos supported the USD and University of Michigan consumer sentiment index jumped to 92.3 in early October - the highest level in two years - from 85.4 in September.

According to Fed Funds futures, the market is currently only pricing in a 25bps rate cut in 2007, reducing rate cut expectations significantly from a fortnight ago. Medium terms risks are still for the USD to decline as we expect the slowing housing market will cause the Fed to cut interest rates by 100bps next year, while appetite for carry trades is unlikely to be sustained at current strong levels.

But in the near term we recognise that short USD position capitulation, a resolute Fed, stronger equity markets and continuing capital inflows into the US as given by both our Equities for FX and FX Flow Monitor all suggest the USD will be stronger in the short term for longer.

This week, US PPI (Tuesday) and CPI (Wednesday) data for September are due, along with the October Housing Market Index (Tuesday) and September housing starts (Wednesday) and the TIC data on Tuesday. We expect these data to show a weakening housing market, a gradual slowing in broader activities and moderate price pressures, while capital flows are likely to remain USD supportive.

Ahead today, Fed chairman Bernanke (1730GMT), Fed's Poole (1730GMT) and Yellen (1940GMT) are all due to speak, while the Empire State index for October is the only data due today.

Precious Metals Update

Precious Metals has pushed upwards very nicely last week, following the Crude Oil, and Geo-Political tensions, supporting them.
On the Downside we see 570 supporting very nicely
On the Updside we see 606.50 holding very nicely, crossing that opens the channels for a push Upwards.

North Korea / US update

Reports (Reuters) quote US intelligence official saying initial US air testing on North Korean blas found no radiation. US not ready to state definitively if NK test was nuclear.

EUR/USD Posted 3 month low below 1.2488

EUR/USD has posted 3 month low below 1.2488 levels..
It dived below 1.25 due to the US data which came in Support to Dollar.
Precious Metals in Rise due to Crude Oil
All Traders KEEP SOLID EYE on Crude Oil, GeoPolitical Tensions.
Todays Norway cut has helped the Crude Oil price Jumped upwards.

US Datas in 4 minutes

We have U. Of Michigan Confidence and Business inventories coming up at 14:00 GMT
The time for U. Of Michigan Confidence has been changed from 13:45 to 14:00 GMT

Gold Update

Gold pushing higher above 580.
Trading at 582 right now.
As we mentioned earlier, watch for Crude Oil, if we see it moving higher, Precious metals will follow the Lead.
London Brent Crude jumped $1 to $59.76/bbl on supply shutdowns in Norway.

Gold should clear 584/585 level, to push higher. However it appears we could see Push upwards today, with NY traders could give a push.

Qatar has offered to host OPEC meeting

Wire reporting that Qatar has offered to host OPEC meeting around Oct20, to finalise oil cut deal.

FED Update - Poole says inflation risks.......

Poole says inflation risks have receded in last 8-10 weeks, danger to growth and jobs has grown, says no gurantee worst over for the soft US housing market, says if all economic news breaks to downside, would advocate rate cuts

Forex Technical Levels

EURUSD violation of 1.2572, Oct 6 low and approximate 76.4% retracement of the 1.2456 to 1.2941 advance reinforces down-trend and exposes further downside towards 1.2456, Jul 19 reaction low. Failure to maintain a foothold above this level would signal a departure from the Summer range an unlock 1.2403 and 1.2266, the 50% and 61.8% retracements of the 1.1825 to 1.2980 advance respectively.

USDCHF is expected to extend recent gains with 1.2736, the 61.8% retracement of the 1.3241 to 1.1919 decline tested. A clear break of this level would pave the way for a climb towards, 1.2929, the 76.4% retracement. Near-term support resides at Monday's 1.2590 low, but weakness below 1.2404, Oct 2 base would be necessary to threaten the broader advance.

GBPUSD loss of 1.8601, Sep 11 low adds credence to the topping prospect and unlocks 1.8493, the 61.8% retracement of the 1.8090 to 1.9146 ascent. The immediate tone is negative below Monday's 1.8715 top. A break of 1.8493 would expose 1.8385, the Jul 26 low.

USDJPY with momentum conditions continuing to provide a positive backdrop, yesterday's break of 119.41, Feb 3 high sets the scene for a move towards the psychological 120.00 level, but with scope for 121.41, Dec 5, 2005 peak thereafter. Intra-day support cuts in at 118.82, Monday's low, but we recommend a bullish stance above 117.38, Oct 3 low.

USDCAD sequence of higher highs and higher lows remains intact and with the with momentum conditions also providing a positive backdrop, further gains are expected towards 1.1460, the July 24 high. Initial support this morning lies at 1.1308, the Oct 4 high.

FOREX ASIA UPDATE - USD

The US dollar was generally lower overnight after being first hit by the wider than expected trade deficit but recovered some ground following the firmer tone in the October Beige Book report.
The USD closed slightly above the 119.25 low against the JPY and 1.2567 against the EUR, while the US rates were generally unchanged after easing earlier on.
The August trade deficit rose to US$69.9bn from US$68.0bn with the additional cost of fuel imports accounting for US$1.5bn of the rise in deficit from a month earlier.

The October Beige Book report was USD supportive with a more optimistic reports coming from four districts against only two districts noting a cooling off of the economy during the month. This compares favourably to the September report which showed five districts reporting deterioration in activities against none reporting firmer growth.

We have been getting a run of mixed data if not slightly positive this week but we expect the data set to gradually look less USD supportive going forward, with the industrial production, core CPI, housing starts and the Phily Fed - which showed a drastic dip to -0.4 in September - next week crucial.

For now, the dollar is continuing to benefit against low yielding currencies from a very favourable environment for carry trades and from an ongoing retrenchment in Fed easing expectations. The rate markets have erased the rate expectations over the course of the last fortnight to now just price in about 25bp of easing in 2007.

We think there are real risks to the very benign soft-landing scenario that the market is currently picturing. At such high US dollar and Dow levels, one wonders what would happen if the Fed says inflation is no longer an issue and shifts their concern to growth.

Today, we get the retail sales numbers for September, business inventories for August and the University of Michigan Confidence .

Japans cabinet Formally Approve Sanctions against NK

Japans Cabinet formally approved sanctions against North Korea on Friday in response to Pyongyangs announcement of a nuclear test this week, including banning imports from the impoverished communist state and blocking North Korean ships from entering Japenese ports.

North Korea Update

North Korea has its own take on the weekend nuclear test as evidenced by a report in the Korean News (DPRK) Wednesday. "The DPRK clarified more than once that it would feel no need to possess even a single nuke when it is no longer exposed to the U.S. threat after it has dropped its hostile policy toward the DPRK and confidence has been built between the two countries," the report says.
The DPRK "exerted every possible effort to settle the nuclear issue through dialogue and negotiations, prompted by its sincere desire to realize the denuclearization fo the Korean peninsula"
In response to the DPRK's "patient and sincere efforts and magnanimity", the Bush administration is suggesting sanctions and a blockade, the report adds. The DPRK warned of "physical countermeasures" if the US persists in "doing harm".

Crude Oil Update

NYMEX November light sweet crude oil futures settled at $57.86 per barrel, up from Wednesday settlement at $57.59 as well as an earlier lowof $57.22.
Precious metals followed the crude Oil how they Moved today.
570 is a solid Support for Gold.
Crossing 584 level is important for gold to push high upwards to 593 where another resistance is lying.
Main key for the moment is focusing Crude Oil. Considering it pushing back again above $60, should help the Precious Metals Heavily.

Traders Await Fed Beige Book

Traders Main Focus is at Fed Beige Book at 18:00 GMT, which shall move the FX markets much effectively.
Just few minutes back we had Crude Oil Inventories Data, The report suggest as enough inventory is availble, which would push the price down, however NYMEX traders also have back of there Mind re "OPEC MEETING"
So we could see tight range trade happening in Energy Markets.
Precious Metals is also moving in same ranges, sit tight, remember Precious Metals have solid co-relation with Crude Oil Market, than rather USD for this 4th Qtr of the Year.
However 570 holds very nicely.

OPEC update

Wires report OPEC is considering a meeting in Vienna in early November, citing unnamed source.

Precious Metals Futures Update

December Gold is consolidating in a range between 585 resistance area and 573 support areas short term, awaiting any signs of increased inflation from the FED and OPEC meeting early next..
However, the medium term downtrend is intact where supports comes in at 550 area in conjunction with a long term perspective. We do not expect gold to make any significant moves for now and due to its indecisive range trading past six trading sessions its preferable to trade with tight stops, and being in the side be a key to get a clear direction.

Market Talk

FOMC minutes illustrates a hawkish view on inflations. More chance of hike then cut.
Energy market listening to OPEC. Want to hear rhetoric tone as well as production estimates.
FX market willing to some hold risk for higher interest rates.
Fixed income sell-off seems to be indicating possible rate hikes or less then expected global slowdown.

Crude Oil Update

WTI Nymex crude oil prices are moderately higher at $57.93, having hit fresh YTD lows yesterday at $57.37 - the lowest level since December 27, 2005, on market scepticism over the OPEC 1mln bpd output cut, and after the IEA cut its world oil demand forecast.

Risk is on continued weakness to $54.85 - the 38.2% of November 2001 to July 2006 rally.

The attention today turns to the weekly DoE oil inventory data, As many forecasting crude oil supplies rose 1.5mln barrels for week ended October 6. Gasoline supplies seen down 450k barrels and distillates supplies down 125k barrels. Supplies remain well above their 5-year average's and risk remains on a stronger than expected build in distillates as refineries increase output ahead of the expected rise in winter heating demand.

Also due is the EIA natural gas storage data at same time at 14:30 GMT,

USD update

USD going a bit stronger on FOMC comments as market has to take into consideration of more possible rate hikes in 2007

FOMC minutes update

It was easier to stay on hold this time. That's what the Sept 20 minutes said in this particularly striking excerpt: "Members noted that certain developments of late -- appreciable declines in energy prices, some softer indicators of economic activity, and slightly lower radings on core inflation -- pointed to a modestly better inflation outlook and hence made the policy decision today somewhat less difficult than it was in August, when it was seen as a particularly close call."

FOMC minutes suggest

FOMC Sept 20 Meeting Minutes: Suggests members were at a cross roads, with concerns about inflation remaining, but also cautious that economic growth could slow more than forecasts had predicted. With uncertainties remaining on both sides, it appears that the FOMC held steady until more data could suggest the next move. Lacker dissented, suggesting that any slowdown in econ growth would not be enough to reduce core inflation and that a further hike was needed to reduce inflation more rapidly in the wake of rising labor costs in the first half of the year.

Crude Oil Update

WTI crude oil in a choppy session, tested the $59.20 resistance without success and trading close to the lows.
We have completed a head and Shoulder pattern in the last six sessions.
Tommorrow US Inventories will set the trend for the next days.

Crude Oil Technical Levels

Risks New YTD Lows Below $57.55

RES 4: $61.45 Daily high 9 Oct
RES 3: $60.68 Daily high 10 Oct
RES 2: $59.35 5-day moving average
RES 1: $58.70 23.6% of $57.85 to $61.30

LAST PRICE: $58.67

SUP 1: $57.75 Daily low 4 Oct
SUP 2: $57.55 Low 17 Feb 2006 on continuation charts & Bollinger base
SUP 3: $56.90 Low 19 Dec 2005
SUP 4: $54.85 38.2% of $78.40 to $16.70

Bears remain in control and risk is now on weakness to $57.55 the YTD low on continuation charts. Below here $57.30 is eyed, which is the reversal low on Sept 25.
However, there isn't anything significant until $54.85 - the 38.2% of November 2001 to July 2006 rally.
Resistance is at $58.70 ahead of the 5-day ma at $59.35.

Bush to Hold news Conferece

Bush to hold news conference at 15:00 GMT - White House

Gold Update

Gold is holding very nicely for way long.
If we see in past, a Long sideways trading, sometimes makes the prices pull down and capture back again to push above resistance.
However, 570 looks holding the gold very nicely.
580 level is the resistance zone, Clearing that gives a good picture for a push Ahead.
However Crude Oil falling below $60, keeps the precious metals in side for the moment.
Traders await minutes of Sep 20 FOMC meeting.
Trade in Discipline, with good Stop orders, and Profit orders.

Dollar is getting weaker before FOMC minutes - awaited

The dollar is taking a moderately weaker tone against its rivals early in New York Wednesday as traders await the release of the minutes from the U.S. Federal Open Market Committee's most recent meeting in September. Market will be looking for hawkish or dovish signs by the rate-setting group

US MBA mortage out

US MBA Mortage Applications (oct 6th) -5.5% vs 11.9% prior reading.
This figure is weekly and volatile

Forex Update - USD

The US dollar has continued to trade in a firm 1.2526-1.2544 range against the EUR and a 119.57-119.78 range against the JPY as the combination of risk seeking carry trades, US inflows and Fed resilience causes further USD shorts to bail.

The housing market has clearly slowed down but so far Fed officials have continued to argue that the fallout into the broader economy will be contained. Indeed with former FOMC Chairman Greenspan arguing last week that the housing market slowdown was now stabilising, the markets are scaling back their interest rate cut expectations.

Yesterday ten year bond yields increased further to 4.74% having been as low as 4.54% in September.

In addition Dallas Fed President stuck to the Fed script about the near term economic outlook arguing that he was comfortable with the current stance of policy but that if inflation pressures were to rise again then the Fed would take additional measures.

Today, the September 20 FOMC minutes and a speech and Q&A session by Fed dissenter Lacker (16.30GMT) are likely to be the focus. We expect the minutes to provide further insight into Fed officials' thinking on the degree of cooling in housing and the overall economy.

Fed Chairman Bernanke has already gone on record estimating that housing would directly subtract about a percentage point from the annualized pace of growth from the second half of this year and into the next.

Also the weekly mortgage application purchase index will be watched today for signs that the housing market is indeed stabilising. We expect the index to rise slightly to in early October 52.4 from 50.5 in early September.

Energy Futures Update

The weekly inventory data will be published tomorrow, moved because of the Columbus day holiday on Monday.
However, the market will await the monthly IEA report, due to be published today.
It is hoped by many traders that this might provide some insight into what the OPEC report, due to be published next week, might reflect. Not withstanding OPEC rhetoric, of course.

Until then, it looks like WTI to stay inside of the daily range at 58.00 to 62.00. As the market is currently trading around 58.00, we see this as a good opportunity for fresh longs, targeting $60.00, on an intra-day basis, ahead of tomorrows inventory data.

Keep good discipline and tight stops, as a break through the daily low from last week could trigger an avalanche of stops.

North Korea Update

Wires reporting comments from N Korea,
- N Korea says to take (future) US pressure as declaration of war and take physical measures.
- N Korea prepared for both dialogue and confrontation - KCNA quotes Foreign Ministry.

GeoPolitical tensions emerging in the market.

Silver Technical Study

Having stabilised ahead of the cluster of support between the Sept. 15 low of 10.480 and the July 19 low of 10.450, silver is now correcting its decline from Sept 28's 11.781 peak.

We consider near-term gains to be corrective in nature, however, and believe that 11.781 reistance will remain intact, maintaining downward pressure on silver. In lieu of price action above 11.781, we look for an eventual move below Wednesday's 10.596 low to trigger further slippage to 10.450 and ultimately 9.470, the June 14 trend low.

Resistance cuts in at the 11.555 high of Oct. 3, but it would take a recovery beyond 11.781 to offset the broader bear.

As long as 11.781 limits gains, focus remains on 10.450.

Fixed Income Market Roundup

US Treasury market was closed yesterday. Treasuries are opening slightly lower with 2-year and ten year yields at 4.71% and 4.77% respectively.

Following the weekends news from North Korea, the US market could see some safe haven flows on reopening after the Columbus Day holiday.
Overnight saw two Federal Reserve speakers reiterating that the inflation outlook still remains uncertain with further progress needed to keep it under control.

European government bonds opened up lower and remained in negative territory following release of German industrial production which showed a rise of 1.9% from July, its biggest gain for 3 years. Today sees release of industrial production in France and Italy whilst ECB President will address the European Parliament.

Following Fridays fall in the gilt market prices stabilised yesterday after release of producer prices which came in weaker than expected. After trading in a narrow range through most of the day virtually all maturities finished with small gains.

Tonight sees Bank of England governor King give a speech, which may indicate whether base rates will be rising in November.

ENERGY FUTURES UPDATE

Market did not really Buy on OPEC agreement of a Production cut of 1Mln Barrel as traders want to see real cuts not only an annoucement.

Oil traded up up to $61.40 on the North Korean News and fell back during the evening session. $59.70 -$61.50 is the range.

PRECIOUS METALS FUTURES UPDATE

FUTURES UPDATE
Sideway trading yesterday amid controversy of the size of North Korea Nuclear test. We could see consolidation continue during the day.

If the Geopolitical news fades we should look for a test of $575 support. Silver also looks toppish around $11.50/60.

With NY Market being opened today, more Liqudity flowing in the market, should bring new trend, pushing the price out of the current tight range 576 - 581.

North Korea Discussion and Significant Event Risk

North Korea Claims to have conducted a successful nuclear test in spite of global condemnation. According to the draft UN statement released on Friday: "the Security Council deems that should North Korea carry out its threat of a nuclear weapon test, it would jeopardize peace, stability and security in the region and beyond."
However it seems N.Korea went ahead with their test. While S. Korea did detect seismic activity they were unable to confirm if the activity was manmade or natural…however in our (amateur opinion) the time seems more then an arbitrary.

Clearly this event will weigh heavily on the already vulnerable JPY. Yen slid .8% against the USD to 119.20 on reaction to the event, and EURJPY 150.24 and GBPJPY broke psychological 223.00 lvl. With Japan enjoying a national holiday we feel only light market resistance.

South Korea has called an emergency meeting of Monday and the U.N said the Security Council will also convene. The US and Japan have both backed sanctions should the nuclear test be confirmed.


Going Forward we see five viable scenarios unfolding:

-- North Korea will exist as a nuclear power (similar to global policy towards India and Pakistanis nuclear test).
-- Japan will see this as an opportunity for military escalation including the addition of nuclear weapons.
-- North Korea will look to sell technology to Iran and Venezuela (and other entities) for oil and currency.
-- China will seize this opportunity to become a true global power.
-- US Military action against Korea (lowest probability at this point).


Risk aversion trades will be the play of the day. Look for appreciation in USD, CHF, gold and oil and to a lesser extent AUD.

Gold Update

Buy Gold could be Favourable short-term
Buy at 578/579 Levels
Stop Order 575
Target 592/593

Technical and Some Premium Added on the GeoPolitical Scene by NorthKorea should support Precious Metals.

Equities Update

We don't have any significant data out that can change the market, except the German Industrial Production for August at 12:00CET. Market expects a rise of 0.3 pct., but any surprise to the downside will send the DAX lower.
PSA Peugeot Citroen, Europe's No. 2 carmaker, and Woolworths Group Plc, a U.K. retailer, may fall after analysts advised investors to reduce holdings of the stocks.
Shire Plc, the U.K.'s third-largest drugmaker, may gain after U.S. regulators moved closer to approving its attention-deficit drug.

Holiday today in Important Trading Centres

Important trading centres closed today,
JAPAN: Health Sports Day
US: Columbus Day
CANADA: Thanksgiving Day.

Crude Oil Update

Crude oil is easing off overnight highs and seen resuming its downward trend on market scepticism that the OPEC cartel will come to an official agreement over output cuts before its planned December 14 meeting in Abuja.
The recent attempts by the hawkish members of the cartel to stem crude oil price decline, by telling wires that the cartel is backing a 1.0mln bpd cut now looks fully priced in and failure
to hold an emergency meeting on October 18/19 in Vienna now leaves crude
oil vulnerable to test fresh year-to-date lows below $57.55.

Technically, last week's close below $60.30 -- the 100-week moving average -- first close below this moving average for the first time since June 2002 - now deemed to be extremely bearish.

WTI Nymex crude oil is at $60.24, up 48 cents.

Crude Oil Update

Oil rose back above $60.00 level, albeit breifly, following comments from OPEC President Edmund Daukoru saying that he is hopeful of a concensus with cartel of the 1.0mln bpd cut by Monday.
It seems that OPEC hasn't reached a concensus decision to cut output as yet, which seems to have been priced in, and indications so far from Saudi Arabia is that there is no plans to cut supplies to prop up prices.
The risk is on the markets attempting to push crude oil prices lower in coming sessions to test the OPEC's resolve.

Data reaction

The US Figures were at their face not impressive, but the unemployment rates dropped to 4.6% from 4.7% expected and the NFPs for August were revised higher by 60K!!
In the light the poor NFPs for September of 51K dont count.
USD/JPY is about to break a very important trend line dating back from 1998.
EUR/USD looks like a mess.
USD strength across the board

Market Update

US and Canadian Labor Market data in focus today. We might be in for a disappointment in Nonfarm Payrolls today. Fixed Income could make new highs on that note.

Stocks: we expect some profit taking today, before an extended weekend. UK banks well bid, the commodity complex also finally finding buyers.

Crude Oil Update

Oil prices over $60.00/bbl on news of an apparent agreement by OPEC to cut production.

OPEC ministers have agreed to remove 1 million barrels a day from its its current production, with lead producer Saudi Arabia cutting 300,000 barrels a day, an OPEC governor and a senior delegate said Thursday.

Nine out of the 11 OPEC members are to cut output, with the exception of Iraq and Indonesia, he said, and added that there was no need for an emergency meeting to ratify the production cuts.

Crude up 94c to $60.35

OPEC Update: Spokesman Says

Wires now quote OPEC spokesman as saying "no such decision" to hold emergency meeting on October 18-19 in Vienna. Crude oil prices are now easing lower, with WTI Nymex crude oil at $60.55.

Crude Oil Update - Attention on EIA Natural Gas Storage

Attention in the oil market turns to the EIA natural gas storage data at 14:30 GMT, and energy analysts expect an injection of between 66-82 Bcf. This compares to the Nymex ICAP auction, which implies an injection of 71.1 Bcf and last years injection of 44 Bcf -- traders note this was Hurricane Rita distorted -- and the 5-year average build of 65 Bcf.

Gold Update

Spot gold holds at $574.00/oz, on the high side of the day's $563.00 to $574.25 range.
Earlier, gold, which has been trading in tandem with oil lately, got a lift from rising oil prices. Currently, Buba's Weber comments about not planning gold sales in Sept06-Sept07 have pushed the precious metal a bit higher.

OPEC Update

Wires report OPEC to hold an emergency meeting on Oct 18-19 in Vienna, quoting APS -- state run news service in Algeria.

ECB Trichet Speech Update

Says " Overwhelmingly in favour of 25Bp rate hike.... Repeats, more hikes warranted if scenerio Materlialises.... Declines to correct market expectations of 3.5% by end 2006.."

ECB Trichet Speech Update

Begins Q&A now

ECB Trichet Speech Update

Money Growth signal Price Risk
Developments need careful monitoring

So Far nothing new and only slightly less hawkish then expected.
Market looks undecided.

ECB Trichet Speech Update

Says "inflation rates remain clearly on the upside"

ECB Trichet Speech Update

Says "recent fall in oil prices may boost growth... growth outlook broadly balanced..risks to growth remain on the downside... drop in inflation in September due to base effect..see inflation above 2% in 2006 and 2007"

ECB Trichet Speech Update

Says " more rate increase may be warrented..liquidty ample.. economic recovery stronger then expected..growth remains robust, may moderate somewhat"

ECB Trichet Speech Update

Says "todays decisions relfects inflation expectations...ahchoring price expectations helps supports growth...rates are still accomating...monitoring inflation very carefully"

ECB Trichet Speech Update

Key points to watch for
1) the word Vigilance - was not mentioned the last times rates were increased, typically mentioned the meeting BEFORE a rate increase.
2) Any Statement on how low or accomocative policy rates are.

ECB Trichet Speech Update

Press Conference Started

Dollar firmer on Lower Jobless Claim - Await Trichet Speech

Dollar mildly firmer on lower jobless claims, but traders await ECB Pres Trichet's press conference shortly before pushing a new trend.
Initial Jobless Claims 302K vs 315K expected
Continuing Claims 2448K vs 2450K expected

US Economic Data and Trichet Speech

At 12:30 GMT
We have Trichet Speech with Q&A

We also have US Economic Datas

Initial Jobless Claims - Expected : 315K
Continuing Claims - Expected: 2450K

At 14:30 GMT
EIA Natural Gas Storage Change

OPEC Update

Wires quote an unnamed OPEC source saying cartel can make "deeper" oil cut when ministers meet on Dec 14.

ECB Raised rates as expected

ECB raised rates as expected to 3.25% (a hike of 25 bps)

Main focus Trichet Speech now at 12:30 GMT

ECB rate decision in few minutes

ECB rate Decision in few minutes,
Expected : 3.25% vs 3.00%

Coming out at 11:45 GMT

Trichet Speech is at 12:30 GMT (look for the language, and explain below in previous posts)

BOE keeps rate Unchanged

BOE keeps rates unchanged as widely expdcted at 4.75%

BOE Rate Announcement in few Minutes

BOE Rate Announcement in few minutes at 11:00 GMT.
The Bloomberg survey expects the BOE to keep rates unchanged at 4.75%

CRUDE OIL IN SPIKE NOW

Crude oil spikes higher on wire reports that Saudi Arabia has cut its output by 300k bpd to 8.8mln bpd. This cut is included in the earlier reported OPEC cut of 1.0mln bpd.
WTI Nymex crude oil is at $60.76.

Wonderful!
Today we will see Nice Support in Precious Metals, and it looks like as we analyzed that yesterday gold touched its Bottom, it likely to push Upwards today
With Crude Oil in Push
Dollar in Weak, Nice Support
Sit Tight

Crude Oil Update

Reported comments from Kuwaiti oil minister
-- OPEC should defend $50.00 price floor
-- Kuwait is maintaining its oil output at 2.6mln bpd

ECB Rate Decision at 11:45 GMT

No surprises are expected from the ECB at 1145 GMT, with a 25bp rate hike to 3.25% being priced into both fixed income and EUR/USD. However, President Trichet's language at the subsequent press conference will be crucial.

'Strong vigilance' implies a follow up rate hike in November, representing an acceleration in the pace of tightening which is so far not priced into the market and so will be significantly euro positive.

'Vigilance', implies a Dec rate hike, almost fully discounted by the market but probably modestly Euro positive.

'Closely monitor' would suggest a further hike will come after Christmas and would be a clear Euro negative

European Traders Focus on BOE, ECB today

Focus in the European forex markets turns to BoE (1100 GMT) and ECB (1145 GMT) rate decisions after weak US ADP and non-manufacturing ISM data Wednesday, and comments from Bernanke. The BoE decision is seen as a close call, but the central bank is expected to stay on hold at 4.75%. The ECB's decision is seen as a done deal, a hike of 25bp to 3.25%, but as always it will be the first few minutes of Trichet's Q&A session at the 1230 GMT press conference that will set the stage.

Looking at the charts, EUR/USD remains in a 1.2655-1.2780 contracting range and would sell rallies to the upper limit with stops above 1.2830, covering on dips to 1.2650.
For cable, Its within the 1.8685-1.9060 range, and while the base holds looks for a move toward pivotal resistance at 1.8910-30 where temporary failure is expected.

EUR/USD trades at 1.2715, cable at 1.8860.

Crude Oil Update : OPEC

OPEC delegate reported saying,- OPEC has 'direction and spirit' to make a significant cut in oil supply.

Asia Traders Profit Booking, bringing Price to same level

Gold touched 570 Levels.
And rolling back towards 563 again, at the time of Europe Opening, and time of few Asia Countries about to close (Profit booking Heavily after buying from the same levels, could be a little nervous after seeing speedy Down Fall Yesterday).
Giving a chance to European Traders to decide where to take the price.
However Crude Oil is Still above $60 , A Good Signal.
Dollar Bearish at the moment.
Reuters/Jeffries CRB Index is up around $2.

Its Appears, Yesterday Gold did touch it low Level, BUT STILL CONFIRM SIGNALS.
Any Harsh Push Down Below 559, Would take us at 543.50

Gold could have touched the Bottom Level.

Gold Could have touched the Botton Level now.
However the crude Oil has come back above $60 Now, which is giving good strength to Precious Metals.
As Opec also has agreed INFORMALLY that it needs to cut production at least 1 million Barrels a Day - at least 4 per cent - in order to boost the falling price of Oil, as FT (uk press) reports.
Todays BOE and ECB Rate Decision, shall give heavy weakness in Dollar, which could give another strength to Gold.
If we see a Rally up from NY traders today, there would be clear signals that it has touched it bottom levels, and proceeding for the moment upwards.
The 563 level, was a nice Support, However gold touched quickly at 559 and bounced back up to 562-563, growing it Support there.
We need to see Today (Thursday) how NY traders react, which is more Heavy Liquid Market.

Bernake Says

Bernake Saying housing showing "substantial correct", and other parts of economy "relatively strong".
He States inflation must be watched carefully, but it is seen coming down slowly over time.

Gold Update

Gold Stands at 561 levels.
It Appears market is looking fot 543 levels Again. However its important to be a little side for the moment, as Crude Oil stays at Support and trying to push higher, also tommorrow we have ECB rate decision and BOE Rate decision, this could weaken heavily the Dollar.

The Other reasons for Down Push is : Tuesday there was a talk that two Central Banks may have been selling gold for Euros, which may have helped the euro recover yesterday.

Market Awaits Bernakes Speech

Market also Awaiting for Bernakes Speech.
Which shall give further signals of what FED is deciding on Interest rates decisions.
Bernake Speech in few minutes at 16:45 GMT

563 level showing its Game

563 level is showing its Game.
We still have to confirm, that this level will hold very nicely.
But any bad Sharp push again, would let us meet 543.50 levels.
However current price right now 567.50+

Gold At technical support - 563

Gold is trying to hold at the 563 technical support we suggested.
Its very important, if something worse happens, We will meet 543 touching it and should rebound.
However, currently 563 is holding itself, And we should expect rebound from here.

Gold Around the level of technical Support - 563

Gold is around at 563 level, Technical Support
Main Reason for such huge drop is due to ISM also which is pushing Stocks, and this Save Haven products go down.
Also Crude Oil is Being Pushed down, which is making prices go further down.
It is likely that we will see 543 again.

Gold Looks like focusing

Gold Is focusing 563 levels, where little technical Support lies.
It cleared 570.
And we will see more downfall, due to Crude Oil
Sit tight.

Crude Oil Update

Wires quoting Saudi Ambassdor saying Kingdom wants to see oil at "reasonable levels" to aid poorer nations. Crude oil now extending decline following across the board builds in all categories in the weekly US DoE supply data. WTI Nymex crude oil is at $58.48.

NYMEX Crude Technical Levels

Low At $57.55 Eyed

RES 4: $64.00 23.6% of $59.52 to $78.40 & Daily high 28 Sept
RES 3: $63.30 Daily high 2 Oct
RES 2: $60.95 5-day moving average
RES 1: $59.25 Hourly high

LAST PRICE: $58.84

SUP 1: $57.90 Daily Bollinger base
SUP 2: $57.55 Low 17 Feb 2006 on continuation charts
SUP 3: $55.85 Support line from 17 Aug
SUP 4: $54.85 38.2% of $78.40 to $16.70

Bears are in control and risk is now on weakness to $57.55 the YTD low on continuation charts. Below here, a downward channel support line from mid August targets $55.85 but nothing really significant until $54.85 -- the 38.2% of November 2001 to July 2006 rally. Resistance is at $59.25 ahead of the 5-day ma at $60.95.

Comex Gold Gets Attracted with Early Bargain Hunting

Some bargain hunting has emerged after Tuesday's sharp sell-off in Comex gold. Traders will be watching for volume and open interest figures later this morning to see what it may suggest about the type of selling during Tuesday's steep decline.
However, the sell-off appeared to occur on unusually light volume considering the volatility. December gold is up $1.60 to $583.10. December silver, however, is down 6.5 cents to $10.98.

Comex Gold Attracts Early Bargain Hunting

Some bargain hunting has emerged after Tuesday's sharp sell-off in Comex gold. Traders will be watching for volume and open interest figures later this morning to see what it may suggest about the type of selling during Tuesday's steep decline.
However, the sell-off appeared to occur on unusually light volume considering the volatility. December gold is up $1.60 to $583.10. December silver, however, is down 6.5 cents to $10.98.

Gold gets slight push from NY Traders

Gold is getting slight push from NY traders, due to also weaker than Expected ADP employment data, we see slight Weakning in Dollar.
Also we have at 14:00 GMT ISM Non Manufacturing and Factory Orders.
We also have Crude Oil Inventories at 14:30 GMT which is main, As Crude Oil is now ruling the Precious metals, and this could take it to next level.
Taking it further, we also have Bernake and Other Fed Speakers, giving there speeches today.

Crude Oil Update

Kuwait Oil Minister reported saying that Kuwait may cut oil output voluntarily if prices drop sharply.

Crude Oil Update

Wires report that Kuwait is unwilling to cut oil output without formal meeting.

The Kuwaiti oil minister added that he will only seek an emergency OPEC meeting if price falls further.

EuroZone Data Update

We just had a release of Euro-Zone PMI Services, which was basically as expected. However, this will probably not have much impact today, as the market is waiting for the release of the US ADP (a pre-cursor to the NonFarm-Payroll Report at Friday), it will be released on 12:15 GMT

Crude Oil hits the 7 Month Low at $58.25

WTI Nymex crude oil hit fresh 7-month low at $58.25 earlier this morning on expectations of another build in gasoline and distillate supplies as refiners ramp up production ahead of the winter heating season.
Traders now talking about a "glut" of oil, with distillate supplies now 15.0% higher than last year, gasoline stocks 9.0% greater, whilst crude oil stocks are 5.0% above last year.
The move lower in oil prices also comes after forecasters at Colorado State University on Tuesday revised their projections -- for the third time this year -- and now expect only two more tropical storms by Nov. 30, the end of the season.
Crude oil now looks vulnerable to hit $54.85, which is the 38.2% of November 2001 low to July 2006 rally, as traders continue to look to test OPEC resolve.
WTI Nymex crude oil is at $58.36, down 31 cents.

Fed Speakers Speaking today

Fed speakers dominate the calendar late in the European day with New York Fed President Timothy Geithner speaking at 1600GMT about financial stability in emerging markets, at the School of Advanced International Studies, in Washington.

At 1645GMT, Fed Chairman Ben Bernanke is due to speak about savings to the Economic Club of Washington D.C. An audience Q&A session is expected at that event.

Overnight tonight, at 2330GMT, Fed Vice Chairman Donald Kohn is due to speak about the US economic outlook to the Money Marketeers of New YorkUniversity, where another audience Q&A session is expected.

Europe Economic Datas

At 0725GMT, ECB President Jean-Claude Trichet testifies at an EUParliament hearing on "The Interception of Bank Transfer Data From theSwift System by the U.S. Secret Services," in Brussels.
It is also the morning for the release of the services PMI data from Europe, with the Eurozone number expected to edge lower to 56.9 from 57.1. Eurozoneretail trade data for August is due at 0900GMT and is expectedto rise 0.5% m/m, 2.0% y/y.

OPEC President Says

-- Says group should cut more output
-- Calls on members to reduce supply
-- Says oil price under $60.00 vindicates cut by Nigeria and Venezuela
-- Says market is "slightly oversupplied".

SILVER Technical Outlook

Maintain a bearish stance on silver as the cluster of resistance between 11.750, former support from Aug 14, 11.865, the 50% retracement of the 13.250 to 10.480 decline and prior support from Aug 29 continues to provide formidable resistance.

While 11.865 continues to cap the topside, the broader trend remains down, but from a shorter-term perspective, as long as Sep 28's 11.781 peak continues to hold, we expect an immediate resumption of the decline from 13.250, the high from Sep 5.

With momentum turning lower again from neutral levels, we are looking for a re-test of 11.057, the low from Sep 25, ahead of an extension to 10.720, Sep 20 floor and ultimately 10.480, Sep 15 pivot low, which is coincident with the 10.450 base from Jul 19.

As long as 11.781 limits gains, focus is on 11.057 then 10.720. We would turn neutral on a move above 11.781, with a recovery beyond 11.865 necessary to push us towards a bullish stance.

Buying should start soon in Gold

583 is a Good Level, where New Buyers could flow in.
However, We still keep eyes open to 577 - which is important level.
And crossing that level, would push the gold further down.
However, We expect Buying Should flow in soon.

North Korea Update

South Korea says it raises its security level, which was expected as a result of North Koreas decision to conduct its first nuclear test.

577 is Main Level for Gold

577 is Main Support for Gold, clearing it we will hit 570, Passing that we will focus 543.
However, we assume 577/79 levels should hold the gold, and Gain the Support.
The Heavy Selling, right now will ofcourse occur a heavy reversal.

Precious Metals Lower on the day

Gold and SIlver are all lower on the day.
Gold has been seeing some heavy Selling from FUNDS.
Silver has been sold all day by a UK Clearer

Crude Oil Update

Crude Oil pushing Down
Around 60.58
-0.45 Down
Bad Signals for Precious Metals.
However a Rebound in Crude oil should appear soon, or that could drive it back to 59 levels

Gold Spot Update

Gold Spot around 588 levels now.
Should build some Support at these levels.
If not, next Support around 582... MAIN SUPPORT is 577, crossing that would provide further down falls.

GOLD FUTURES UPDATE

FUTURES UPDATE
Gold has touched at $593
It should find support around 591/593 if its broken next is 586/7

Crude Oil Update

Iran wants consortium to do uranium enrichment work, according to AFP.

Iran Update

EU's Solana says talks with Iran's Larijani constructive, but no breakthrough
Iranian proposal for French monitoring of uranium enrichment is interesting, needs analysis.

Iran Issue looks like slowly developing, Any tensions occuring, would rally precious Metals

North Korea Update

North Korea Foreign Ministry says to conduct nuclear test - according to JIJI.

Crude Oil Update

BP restarts Lisburne oil field in Alaska

-- Lisborne field closed last week due to gas leak

-- BP says Lisborne field will return to full capacity in days

Energy Future Update

Traders brushed off OPEC comments and an output cut of a combined 170 000 barrels/day from Nigeria and Venezuela to send Oil $2 lower, sending a bearish sign to the Market.
Nevertheless Oil is still in the same range at $64-60. Even if we had a rejection yesterday we can not draw any strong conclusion yet as the market is still sideway.
This range should hold for the short term.
Though watch for the $60.80 level to hold this morning or we could retest the lows.

EuroZone Data in 10 minutes

Europe Zone Figures in 10 Minutes
Euro Zone UnEmployment - Expected: 7.8%
PPI MoM - Expected: 0.2
PPI YoY - Expected: 5.7%

FOREX UPDATE - USD

The USD was able to continue its gains against a beleaguered JPY despite the strong Tankan numbers, but retreated overnight following the weak manufacturing ISM, ignoring the stronger-than-expected pending home sales numbers.
The USD weakened most against the NZD overnight.
If the prospects of rate hikes in Japan did not as yet harm the USD, the prospects of Fed rate cuts may.

The Fed Fund Futures are currently pricing in a 50bp cut in Fed rate through 2007, with the first cut only expected in Q2, but we are expecting more cuts to be priced in as we move into November. With the next round of monthly data, to be released this month, likely to lend more support to the notion that Fed is more likely to ease than to hike again, we could see the USD facing a tougher climb against both the JPY and the EUR at elevated levels.

Of the data to watch are the key non-farm payroll numbers later this week. Like the overnight ISM numbers, the NFP numbers could inflict more pain on the USD.

Fed members are also taking turns on the rostrum this week, with Hoenig speaking on the economy today and chairman Bernanke on Wednesday.

Ahead today, only second-tier data, including the light vehicle sales, weekly store sales and the Challenger layoffs report, are due for release. We expect vehicle sales to recover to 16.5mn from 16.0mn in August but the trend remains negative given the 16.9mn annualised rate seen in the first quarter.

Forex Update

USD: Weaker ISM hurts the USD
JPY: Investors still buying foreign papers
EUR: PMI in line
GBP: PMI firmer
THB: Lukewarm reception to Surayud's appointment
BRL: Presidential elections go to the second round
ZAR: Look for the 8-handle

Crude Oil Update

Oil prices weakened in Asian trade in a sell-off over concerns of high inventories. At 0410 GMT, New York light sweet crude for November delivery, was down 11 cents at $60.92 a barrel from $61.03 in late US trade.

Physical Buying Pushing Precious Metal price Upwards

Top Asian Countries Open for Trading.
Pushing the Precious Metals Upwards.
Radar shows Physical Buying occuring in Indian And few other Asian Countries, pushing the prices upwards.
We look ahead for Europe Market to open in few hours, Considering Physical Buying out there, would push the gold back upwards $600.
And Looking Europe Zone Economic Indicator today, would eventually set signals for Dollar fallback, giving slight support to Precious Metals in return.
Main Key is to look for Crude Oil prices, currently a little down $0.10, however recovering from early Asia price.

Gold Asia Update

Gold Plays in 595 range.
Due to Crude Oil price falling yesterday, Gold followed the same path, and didnt recognize the Weakness in Dollar.
It looks like we might expect a DownFall today, if we dont see any Quick rally upwards.
Any GeoPolitical Tensions, could presumably support the price,
Presently prices are in tight Mixed range, whether they go up, whether go down.
Technically, we expect it to go down, as Signs passes by, However, we could expect a Good Suprise if Gold focuses little in Dollar weakness, and rallies happily Upwards.
Around 2 Hours past for Asia Market to open, We shall Await India Market and few Other top Asian Countries to open, which may Support the prices, in Physical Buying Pressure.
However, European Physical Buyers have started to buy Gold at such low prices, and Stocking them up for the upcoming Christmas festive.
Such Support is indeed warming up the table, Which is IMPORTANT.

Main Co-relation of Precious Metals is Crude Oil, So Keep Focus on Crude Oil Prices for the moment.
As Various traders expect, this week we could see a Push in Crude Oil prices, which is eventually Indeed awaited, As It Appears, Commodities, Energy has touched the Down Levels, and we could expect a Rebound very soon, entering the 4th Quarter of this Year, bringing in New Investments in such sectors.

Gold Update

Gold pushing slightly lower, due to reasons of Crude Oil pushing in low levels.
However Gold trading in Mixed range, due to Dollar weak on the Board, pushing it Up
Crude Oil is pushing lower, making gold push down.
However, Precious metals have Heavy Co-relation with Crude Oil prices.
Gold staying is above the 200 MA is the main Call.

USD weakness all around the board

Market reaction after the Data out.
After 20 Minutes.
EUR/USD pushing higher now at 1.2756
Gold Climbing back to 601+ touching 599 in a Quick tone
usd/jpy meeting 117.65 zone.

It appears USD weakness all around the board

US Figures should have a mixed impact

The US Figures should have a mixed impact.
The Pending Home Sales and the Construction Spending are showing a somewhat stable economic development (or a soft landing), but the worse/lower than expected ISM Manufacturing and Prices Paid should be negative for the USD and good for fixed income.

Data Out

Data out

Construction Spending MoM (US) - 0.3%

ISM Manufacturing (US) - 52.9

ISM Prices Paid (US) - 61.0

Pending Home Sales (US) - 4.3%

US Data coming out in 3 minutes

3 minutes to go for US Figures

Construction Spending MoM (US) - Expected: -0.3%
ISM Manufacturing (US) - Expected: 53.5
ISM Prices Paid (US) - Expected: 68.0
Pending Home Sales (US) - Expected: -1.0%

Quicky Movements before US Datas

Very Quick Movements happening in the market just 5 mins before Data
EUR/USD moved quickly above 1.2740 - European Good Buyers
USD/JPY moved below 117.80 - London Players good sellers there.

Precious Metals in Mixed ranges

Main Focus on 14:00 GMT data

Spot Gold Holds at 603

Spot gold holds at $603.00/oz after trading in a $599.50 to $603.70 range. The precious metal has been closely tracking oil prices in recent sessions, with Monday no exception. If oil starts to head back to last week's sub $60 lows, gold is also likely to trend lower.
Conversely, if oil can get back over $64/$65, gold is also expected to rally. A move over $606.50 (last week's high) and then over the 9/11 high near $610.50 would be needed for upward momentum to build

Crude Oil Update

Crude oil is lower as market dismisses decision by Nigeria and Venezuela on Friday to cut production by combined 170k bpd.

The significance of the cut seems negligible given both these countries produce less than its OPEC quota levels, in particular Nigeria, where pipelines have been attacked by militants/rebels.

Moreover, the planned cuts are insignificant, given the cartel is still pumping around 28mln bpd, and there is a global oil surplus of at least 500k bpd, according to Venezuelan oil minister Rafael Ramirez.

Saudi Arabia, Kuwait, and the UAE all produce well above their quotas. Traders continue to look for crude oil prices to ease below $60.00 level, as speculators attempt to test the OPEC's resolve. WTI Nymex crude oil is currently at $62.49, down 42 cents.

Comex Gold Gain due On Physical Buying Support

Physical support overnight lends a firmer feel to Comex gold; however, the week long holiday in China is likely to keep trading conditions thin, as seen in Asia.

With the market now in the last quarter of the year we will see investment interest as well as physical buying pick-up as jewelry manufacturers in Europe and North American begin to stock-up ahead of the Christmas period, and could potentially see the metal work its way back towards the $700 level.

USD Weak just before US Data figures

USD is looking very week, as market is positioning itself before US figures.
EUR/USD jumped to 1.2712 and USD/JPY dropped slightly below 118.00.
Very Choppy Price movements.

Low volume trading Before Economic Data

Very Low volume trading occuring in Precious Metals, as market awaits for the US Economic Data releasing at 14:00 GMT

Construction Spending MoM (US) - Expected: -0.3%
ISM Manufacturing (US) - Expected: 53.5
ISM Prices Paid (US) - Expected: 68.0
Pending Home Sales (US) - Expected: -1.0%

ENERGY FUTURES UPDATE

Crude Oil is well supported around the $60 level since OPEC declarations that they will monitor the price closely and make the necessary cuts if needed.
Friday Nigeria and Venezuela joined the chorus effectively cuting their output respectively 120 k and 50k barrels a day. We see Oil trading in the $60-65 range in the near trend.
Buy around $62.30 with a stop below $60.00.

FOREX UPDATE : USD

USD ISM, Bernanke and payrolls key this week: the USD has started the week and the new quarter, trading in a 1.2665-1.2689 range against the EUR and a 117.87-118.40 range against the JPY.
The greenback has stayed range bound against the EUR despite ten year bond yields falling sharply throughout Q3.
In contrast equities have strengthened. On the surface it looks as if rallying bond and equity markets are signalling conflicting outlooks but the sharp decline in oil prices can partly explain the rally in both markets.

The USD has remained supported as Fed officials have not yet dropped their bias to tighten further. But on Friday Dallas Fed Fisher said there were signs that inflation pressures were abating and St Louis Fed Poole said that a more rapid slowdown in growth and signs of waning inflation would prompt the Fed to ease interest rates.

It's a key data week in the US, with the manufacturing ISM later today and the September employment report ending the week. We expect the ISM headline to hold steady around last month's levels, while payrolls likely continued to advance at the subdued pace of the last three months, with our 125k target in line with the trend of the past six months. With rate markets pricing a risk of easing by year-end, markets would likely be sensitive to upside surprises. However, it would likely take a significantly above-consensus print on payrolls to alter Fed expectations materially.

Markets will also listen closely to Fed Chairman Bernanke's speech at the Economic Club of Washington on Wednesday for any sign of shift to a more neutral policy stance. Also of note, Treasury Secretary Paulson is scheduled to visit New York for closed door meetings with the New York Fed and financial and business executives.