News Column

KASB Securities Limited and Economics Research - Commodities Corner

July 11, 2014



Gold rises as Portuguese banks fuel safe haven demand

Gold higher amid retreat in US equities and Portuguese bank turmoil: Gold futures closed at their highest level in four months as investors turned to gold in the wake of Portugal's banking turmoil. Problems at one of Portugal's biggest banks hit US and European stocks as it reminded investors of the fragility of Europe's banking system.

A technical breakout led to additional gains in the yellow metal.

WTI holds ground on positive US labor data: Oil prices finally stabilized after a week of significant losses. Supply concerns eased in Iraq and Libya while today's better than expected US labor data suggested improving growth prospects for the U.S economy.

Time Currency Impact Event Forecast Previous

11th July 2014 Friday

5:30pm CAD High Employment Change 26.2K 25.8K

5:30pm CAD High Unemployment Rate 7.0% 7.0%

14th July 2014 Monday

2:00pm EUR Medium Industrial Production m/m 0.3% 0.8%

10:00pm EUR High ECB President Draghi Speaks - -

Gold Spot

Technical Strategy: Buy on Weakness

Gold closed at US$1,335, above the 5 - DMA which is at US$1,327. RSI and Stochastic are bullish and suggest higher prices in the near term. KASB Securities Limited recommends buying on weakness above US$1,327 targeting US$1,346 (yesterday's high) with stops below US$1,320 (10 - DMA).

Silver Spot

Technical Strategy: Play the range

Silver closed at US$21.36, above the 5 - DMA which is at US$21.12. However, RSI and Stochastic are overbought and suggest that upside is limited. KASB Securities Limited recommends playing the range of US$21.12 - US$21.55 (yesterday's high). A break below US$21.12 can target US$20.92; while a break above US$21.55 can target US$21.81 (upper Bollinger).

WTI Spot (Crude Oil)

Technical Strategy: Buy on Weakness

Oil closed at US$102.88, above the 100 - DMA which is at US$102.41. RSI and Stochastic are bullish and suggest higher prices in the near term. KASB Securities Limited recommends buying on weakness above US$102.41 targeting US$103.61 (50 - DMA) with stops below US$101.92 (yesterday's low).


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Source: Pakistan Press International


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