Gold and Silver Outlook for February 26
Submitted by Trading NRG as part of our contributors program.
The bullion market shifted gear and both gold and silver bounced back yesterday, following their plunge during last week. The Italian elections resulted in a deadlock which may have led to the weak Euro. This news, however, didn’t seem to hold back precious metals prices from rising. Will gold and silver change course and fall today? On today’s agenda: Ben Bernanke will testify at the Hill, core durable goods, U.S GDP for the fourth quarter, China and U.S manufacturing PMI, U.S Consumer Confidence and new home sales reports will come out..
On Monday, the price of gold bounced back and rose by 0.88% to $1,586.1; Silver also increased by 1.85% to $28.99. During the month, gold decreased by 4.49%; silver, by 7.49%.
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The gold and silver futures volumes of trade declined on Friday to 153 thousand and 59 thousand, respectively. These numbers are lower than the volume traded during the preceding days. If the volume will pick up in the coming days, this could suggest the plausibility of sudden sharp changes in the prices of gold and silver due to high volume will increase.
On Today’s Agenda
Bernanke’s Testimony: Following the recent publication of the minutes of the January FOMC meeting, if Bernanke will hint of the future plans of the FOMC vis-à-vis the QE3 and the timeframe the Fed might consider putting on it, this news could pull down commodities rates. The Chairman of the Federal Reserve will testify before the Committee on Banking, Housing, and Urban Affairs in the U.S Senate. The title of the testimony is “Semiannual Monetary Policy Report to the Congress“;
U.S Consumer Confidence: based to the latest report, the consumer confidence index fell in December to 58.6 (M-o-M). The current expectations are that the January index may continue to fall; this report might affect commodities prices including the oil and natural gas rates;
U.S. New Home Sales: in the latest report (for December), the sales of new homes rose to an annual rate of 369,000 – a 7.3% drop (month over month); if the number of home sales will further fall, it may indicate a sign of a slowdown in the recovery in the U.S real estate market which may also affect the direction of the USD.
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