Weekly Prediction: Crude Oil, Gold, Silver

Posted by admin as Daily forex analysis, Forex News

Gold
Gold, which has registered 4 straight sessions of gains, has risen 5% over the past week and is 8% below an 11-month high above $1,000 hit in February. On Monday, Gold jumped to its highest in almost 4 weeks as fears of global flu pandemic prompted investors to seek safer assets in precious metals.

Gold hit an intraday high of $918.25 an ounce, its highest since April 2 after China said last week its gold reserves had risen. The metal later slipped to $914.30, still $3.20 higher than New York’s notional close.

Analysts said that it looks like the market has moved out of the 2-month downtrend and perhaps Gold could head very much higher. The increase in Chinese reserves also did play a part in Gold resent up trend, and market players expected Gold to face resistance around $932 an ounce, an intraday high seen in early April.

Silver

Silver gained 1.6% to $13.08 an ounce after climbing as high as $13.26, may rise for another day to post its longest winning streak since December as falling equities increase the metal’s appeal as an alternative investment.

On Thursday Silver rose after data showed a big increase in claims for U.S. unemployment benefits, raising economic worries and increasing the precious metals’ value as a safe asset.

Oil
Crude prices gained last week as stock markets climbed amid optimism that the world is past the worst of the recession. However, oil prices fell as much as $2.90, or 5.6%, to $48.65 a barrel on Monday on concern the U.S. economy will keep shrinking and the swine- flu outbreak will curtail air travel.

Analysts said that the commodity markets today are dominated by fear, as investors are concerned that the spreading of swine flu in Mexico may severely damp hopes of an economic recovery. As a result of this instability in the market the oil price is expected to move sideways, with some volatility between $45 and $55. Given that oil market fundamentals are still weak, downside risks prevail at the moment.