4 Aug 2014

Gold / Silver / Copper futures - weekly outlook: August 4 - 8

                                     Gold futures bounced off a six-week low to end Friday’s session almost 1% higher, following the release of weaker than expected U.S. nonfarm payrolls data for July.

On the Comex division of the New York Mercantile Exchange, goldfor December delivery jumped 0.94%, or $12.00, on Friday to end the week at $1,294.80 a troy ounce.
Prices fell to a session low of $1,281.00 an ounce earlier Friday, the weakest level since June 19.
Gold prices were likely to find support at $1,276.20, the low from June 19 and resistance at $1,314.60, the high from July 29.
Gold regained strength after the U.S. Department of Labor said non-farm payrolls rose by a seasonally adjusted 209,000 in July, below expectations for an increase of 233,000.
The unemployment rate ticked up to 6.2% last month from 6.1% in June. Analysts had expected the jobless rate to hold steady at 6.1% in July.
The disappointing jobs report dampened optimism over the strength of the labor market and reduced expectations that the Federal Reserve will begin to raise rates sooner than previously thought.

Despite Friday’s strong gains, Comex gold prices declined 0.65%, or $8.50, on the week, the third consecutive weekly loss, as strong U.S. economic data underlined the view that the recovery is gaining momentum.
Official data on Wednesday showed that U.S. economy grew at an annual rate of 4.0% in the three months to June, outstripping forecasts of 3.0% and following a contraction of 2.1% in the first three months of the year.
Meanwhile, the Fed cut its asset purchase program by $10 billion to $25 billion per month at the conclusion of its two-day meeting on Wednesday, staying on course to end the bond-buying program in October.
Gold has been under heavy selling pressure in recent weeks as an improving U.S. economy fuelled speculation that the Fed will hike interest rates sooner than expected, which would reduce the need for gold for use as a hedge against loose monetary policy.
Data from the Commodities Futures Trading Commission released Friday showed that hedge funds and money managers decreased their bullish bets in gold futures in the week ending July 29.
Net longs totaled 122,092 contracts, down 10.3% from net longs of 136,120 in the preceding week.
Also on the Comex, silver for September delivery shed 0.2%, or 4.1 cents, on Friday to settle the week at $20.37 a troy ounce. Prices slumped to a daily low of $20.24 earlier in the session, the cheapest since June 19.
On the week, the September silver futures contract lost 1.26%, or 26.0 cents, the third straight weekly decline.
Data from the CFTC showed that net silver longs totaled 41,699 contracts as of last week, compared to net longs of 46,221 contracts in the preceding week.
Elsewhere in metals trading, copper for September delivery declined 0.51%, or 1.6 cents, on Friday to end the week at $3.214 a pound by close of trade.
On the week, Comex copper prices fell 0.8%, or 2.9 cents a pound, as investors gauged the health of China’s manufacturing sector.
Official data released Friday showed that China's manufacturing purchasing managers’ index rose to a two-year high of 51.7 in July from 51.0 in June, beating market expectations for a 51.4 reading.

Still, China's HSBC final manufacturing PMI for July ticked down to 51.7 from a preliminary reading of 52.0. Analysts had expected the index to remain unchanged.
China is the world's biggest buyer of copper, accounting for roughly 40% of the market.
According to the CFTC, net copper longs totaled 38,859 contracts as of last week, down from net longs of 44,107 contracts in the preceding week.
In the week ahead, investors will be focusing on the outcomes of a spate of central bank meetings, with the European Central Bank, the Bank of Japan, the Bank of England and the Reserve Bank of Australia all to hold monetary policy assessments. - investing.com

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