News Column

KASB Securities Limited and Economics Research - Commodities Corner

June 3, 2014



Commodities fall despite soft US consumer data week, falling almost one percent to a near four-month low on Friday, weighed down by book squaring ahead of month end and selling by commodity funds. The yellow metal largely ignored a US government report which showed declining US consumer spending for the first time in a year in April, after two months of solid gains.

WTI posted first weekly loss in a month: WTI capped the first weekly loss since May 2 as US consumer spending fell in April and rising inventories signalled ample supply. In other news, Russia, the world's biggest energy exporter, has withdrawn a majority of its military forces from the Ukrainian border which diminished some geo-political risks.

Time Currency Impact Event Forecast Previous

02nd June 2014 Monday

7:00pm USD High ISM Manufacturing PMI 55.7 54.9

03 rd June 2014 Tuesday

2:00pm EUR High CPI Flash Estimate y/y 0.7% 0.7%

7:00pm USD Medium Factory Orders m/m 0.6%

1.1%

Gold Spot

Technical Strategy: Play the range

Gold closed at US$1,249, below the 5 - DMA which is at US$1,255. However, RSI and Stochastic are bullish and suggest that the downside is limited. KASB Securities Limited recommends playing the range of US$1,242(Friday's low) - US$1,255. A break below US$1,242 can target US$1,237; while a break above US$1,255 can target US$1,273 (10 - DMA).

Silver Spot

Technical Strategy: Play the range

Silver closed at US$18.79, below the 5 - DMA which is at US$18.92. However, RSI and Stochastic are bullish and suggest higher prices in the near term. KASB Securities Limited recommends playing the range of US$18.62 (Friday's low) - US$18.92. A break below US$18.62 can target US$18.55; while a break above US$18.92 can target US$19.16 (10 - DMA).

WTI Spot (Crude Oil)

Technical Strategy: Sell on Strength

Oil closed at US$102.86, below the 10 - DMA which is at US$103.55. RSI and Stochastic are bearish and suggest lower prices in the near term. KASB Securities Limited recommends selling on strength below US$103.55 targeting US$102.19 (20 - DMA) with stops above US$103.91 (Thursday's high).


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Source: Pakistan Press International


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