Bullions
Gold edges up amid sharply lower dollar, creeping near 28-month highs
Gold ticked up on Wednesday, as the dollar fell sharply against a basket of rivals, helping provide a slight boost to the yellow metal in quiet, range-bound trade. Gold closed higher for the third time in five sessions and nine of the last 12. With the slight gains, approximately 25% year to date and is on pace for one of its strongest years in a decade.
Investors continue to closely monitor U.S. employment data for a gauge on the strength of the labor market, following last Friday's robust jobs report for the month of July. On Wednesday, the U.S. Department of Labor reported that job openings rose by 2.0% in June to 5.624 million from a relatively soft revised annualized rate of 5.514 million a month earlier. Analysts expected to see slight increases on the month to 5.588 million.
At the same time, the Labor Department's Job Openings and Labor Turnover Survey (JOLTS) showed there were 5.1 million hires in June, an increase of 1.7%, offset slightly by 2.9 million quits on the month. The mild increase in monthly job openings was driven by an increase in job postings in the durable goods manufacturing sector.
Over the last several weeks, a host of policymakers on the Federal Open Market Committee (FOMC) have indicated that a September interest rate hike could be on the table if the labor market continues to show improvement and inflation moves closer to its targeted goal of 2%. On Wednesday, the CME Group's (NASDAQ:CME) Fed Watch tool placed the probability of a December rate hike at 37.8%, up from around 30% last week.
Any rate hikes by the Fed this year are viewed as bearish for gold, which struggles to compete with high-yield bearing assets in rising rate environments.
Energy
Oil prices were largely unchanged on Wednesday, giving up earlier gains after the U.S. government reported a surprise crude stockpile build.
Crude inventories rose 1.1 million barrels in the week ended Aug. 5, compared with analysts' expectations for a decrease of 1.0 million barrels, the U.S.
U.S. gasoline futures (RBc1) rose nearly 1 percent, extending gains, after the EIA also reported a larger-than-expected gasoline drawdown of 2.8 million barrel, but last reversed gains and was trading at down nearly 1 percent.
Brent crude futures (LCOc1) rose by 2 cents to $45 per barrel.
Natural gas futures struggled near the lowest level in eight weeks on Wednesday, as market players looked ahead to fresh weekly information on U.S. gas inventories to gauge the strength of demand for the fuel.
Market players looked ahead to weekly supply data due on Thursday, which is expected to show an increase in a range between 17 billion and 30 billion cubic feet of gas in the week ended August 5.
That compares with a surprise drop of 6 billion cubic feet in the preceding week, 65 billion a year earlier and a five-year average of 53 billion cubic feet. Total U.S. natural gas storage currently stands at 3.288 trillion cubic feet, according to the U.S. Energy Information Administration, 11.8% higher than levels at this time a year ago and 14.1% above the five-year average for this time of year.
Demand for natural gas tends to rise in the summer months as warmer temperatures increase the need for gas-fired electricity to power air conditioning.
Natural gas futures have been under pressure in recent days amid speculation that August heat won’t prevent stockpiles from reaching a record before the winter.
Unless intense summer heat boosts demand from power plants, stockpiles will test physical storage limits of 4.3 trillion cubic feet at the end of October.
Technical Levels
Gold
Support at 31000 and Resistance at 31500
Looks positive above 31500 we can se upside move till 31800—32000 and then to 32200 mark in days to come else could test its support level of 31000.
Trade with levels only
Silver
Support at 45800---45400 and Resistance at 47400---47700
Above 47700 it can touch 48000---48400---49000 marks else could test its support level of 45800---45500 mark in days to come.
Trade with levels only
Crude oil
Hurdle at 2850---2920 and Support at 2750
Close below 2750 will take to 2680---2650 and then to 2600 mark else it could test its resistance level of 2850---2920 again.
Traders can trade with levels only.
Copper
Support at 317 and Resistance at 325
Close below 317 will take to 312---310 and then to 305 mark. Further downside panic will see only close below 305 mark else it could test its resistance level of 325 mark again
Further upside rally will see only close above 325
Trade with levels only
Today's Data and Event
CAD NHPI m/m – 06:00 P.M
Unemployment Claims – 06:00 P.M
Import Prices m/m – 06:.00 P.M
Mortgage Delinquencies – 07:30 P.M
Natural Gas Storage – 08:00 P.M
