- 51% of all SWFX open positions are bearish
- Prices passed the 1,260 mark
- Gold surged from 1,240 to 1,265 on Wednesday
- Economic events to watch over the next 24 hours: US Initial Jobless Claims (Jun 4); US Wholesale Inventories (April)
According to the latest report, the US crude futures advanced for a third consecutive day on Wednesday, reaching new 2016 highs. The US benchmark posting a nearly 11-month closing record. On the New York Mercantile Exchange, West Texas Intermediate crude for July delivery added +0.62% and rose 87 cents, or 1.7%, to settle at $51.23—showing the highest close for a nearby contract since July 15. Meanwhile, August Brent crude, increased 0.42% the global oil benchmark, reaching $1.07, or 2.1%, to finish at $52.51 a barrel on London's ICE Futures exchange, its highest close since October. According to the analysts, futures were affected in a positive way boosted by reports of another attack on oil facilities in Nigeria. They were also buoyed by data from an industry trade group, the American Petroleum Institute, which on Tuesday said that US crude inventories had fallen by 3.6 million barrels. Also, crude found support from continued supply disruptions, as well as China import data and a decline in crude inventories. By the way, prices have nearly doubled since hitting 13-year lows earlier in this year mostly since companies have slashed spending on new drilling, and unplanned outages in Nigeria and Canada helped reduce the global oversupply of crude.
According to the official data Chinese trade surplus rose less-thanexpected last month. The report released by National Bureau of Statistics of China announced that Chinese trade balance rose to 49.98B, from 45.56B during the preceding month. Moreover, economists had expected data to reach 58.00B mark during the last month. In the meantime, value of China's exports continues to decline further in dollar terms during the previous month in line with expectations. Chinese imports, in turn, contracted at their slowest pace since 2014 in May, suggesting that government stimulus measures focused on housing and infrastructure are succeeding in stabilising demand. Chinese imports of unwrought copper and copper products plunged 3.7% on a monthly pace to 430,000 tonnes in May. This pushed imports to 2.31 million tonnes in January-May, up 22.1% year-on-year period. Meanwhile, analysts from Australian and New Zealand Bank do not expect strong rebound in import data since they predict that domestic demand will likely edge down on a tighter credit environment. Also, it is worth to point out that trading in China is expected to slow ahead of Chinese CPI as well as businesses will close for the Dragon Boat festival on Thursday and Friday.
Upcoming fundamentals: US Initial Jobless Claims and Wholesale Inventories
Thursday is set to be a quiet day for fundamentals, which could affect the yellow metal, as it is mostly moved by changes in data affecting the US Dollar. At 12:30 US Department of Labor is set to release the weekly jobless claims data. The most important indicator from the batch of released data is the Initial Jobless Claims number, which indicates the change in employment in the US and thus the strength of the US economy. Experts forecast a 270,000 new jobless claims. In the meantime, U.S. Census Bureau will release the wholesale inventories changes in percentage at 14:00 GMT.
Gold above 1,260, as the Greenback weakens
Daily chart: The bullion passed the 1,260 price on Tuesday and did not give up its position, as it gained even more strength against the US Dollar on Wednesday. At the moment the yellow metal is close to the 1,262 mark and it was volatile for the first part of Thursdays trading, at one point even passing the 1,266 level. On its way up gold faces the second weekly resistance at 1,274.37 and close by is located the first monthly resistance at 1,278.62. In the meantime, it is supported by weekly R1 at 1,259.11, which could prevent it from losing its Tuesday's gains.Daily chart
Hourly chart: The hourly chart shows that the surge of Gold prices has calmed down, as the bullion fell from 1,264.89 to 1,261.83 in the first hour of Thursday's trading session. Since then the yellow metal has had some minor volatility, but it has not set a distinct course upwards or downwards, as gold is fluctuating around the level of 1,261.20. If it goes down, the bullion faces the support of 55-hour SMA at 1,259.98 and weekly R1 at 1,259.10. However, on the course upwards is located the daily R1 at 1,269.17. In the meantime, aggregate technical indicators predict a fall for gold today.
Hourly chart
SWFX market sentiment bearish on Thursday
Meanwhile, OANDA and SAXO Bank clients are bullish with respect to the bullion, precisely in 63.84% and 52.89% of all cases, correspondingly, in the Thursday morning on June 9. However, it is a decrease to the bearish side, if compared to Wednesday's morning.