Gold Daily Fundamental Analysis
Gold was mixed on Monday in the early trading as investors remain cautious over the outlook for gold amid rising uncertainty and a strong dollar.
Gold did not lose heavy grounds and held most of the gains seen on Friday as the metal seemingly is breaking lose of its heavy effect to the dollar that was seen recently as mounting fears fuel haven demand.
Risk aversion was seen across the board and the dollar rallied higher especially on a weak euro that remains battered with debt woes.
Debt fears intensified after Fitch on Friday downgraded Greece’s credit rating again by three steps and warned of the outlook shall the EU and the IMF did not aid Greece. The news were followed by S&P’s decision over the weekend to downgrade the outlook for Italy’s credit rating to “negative” citing risk from the political instability to hinder the plans to cut the surging debt.
China and the euro area fueled the fears over slowing growth with downbeat manufacturing figures and the euro area even reported slowing services sector expansion in May.
Gold is still volatile with the dollar’s gains, nevertheless, with the rising uncertainty the outlook for the metal is tending more bullish and gold might regain the upside momentum after correcting some of the gains seen on Friday on haven demand and hedge against the rising uncertainty.
Crude Oil Daily Fundamental Analysis
Crude oil prices continued to drop on Monday, as pessimism dominated investors amid concerns over the European debt crisis, in addition to slowing economic activities in China and Europe, which increased speculations of lower demand on oil.
Investors had a busy day despite the lack of economic news from the United States, where investors are concerned that Greece will be forced to restructure its debt, while the S&P decision to downgrade the outlook for Italy's debt ignited further fear in markets, as the European debt crisis seems to be expanding further.
We still maintain our bearish short term outlook for crude oil prices, since pessimism continues to dominate markets due to the uncertainty over global growth prospects, and the ongoing European debt crisis, which continues to weigh down on confidence levels all around the globe, and that is putting further pressure on crude oil prices to decline.
Tuesday 14:00, the U.S. will release the new home sales index for the month of April, where new home sales are expected to rise by 1.7% to an annual rate of 305,000 units, compared with the prior estimate of 300,000 units, although the housing market showed further weakness in April, as the housing market remains depressed.
Natural Gas Daily Fundamental Analysis
Natural gas prices rose on Monday amid expectations of above than average temperatures in the United States, which boosted speculations of rising demand for power fuel, in addition to a report from Baker Hughes on Friday that showed drilling rigs dropped last week to 866, the lowest level since January 2010, which put upward pressure on natural gas prices.
Based on recent expectations of warmer than normal weather conditions, we should expect natural gas prices to extend the rise on Tuesday.
Gold Prices Predictions May 24 2011, Crude Oil Prices Forecast May 24 2011, Gas prices, predictions may 2011. For the latest updates PRESS CTR + D or visit Stock Market news Today
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