Commodity Weekly Report January 13 2013
14/01/2013 (Borneo Post) - The European Central Bank (ECB) and Bank of England (BOE) both held the benchmark rates unchanged last week.
On Thursday, ECB President Draghi expressed confidence in recovery in euro economy this year once the bond markets stabilise.
Japan’s Finance Minister Taro Aso also planned to buy more bonds issued by European Stability Mechanism to maintain yen weakness.
USDX has been receding further and pushing up most commodity prices.
WTI Crude prices have been struggling to stand above 92.50 supports amid increasing supplies.
The US crude inventories rose 1.3 million barrels above forecast in the week ended January 5.
This week, we forecast the market may rise to 96.50 targets should USDX weaken further from rising euro currency.
The aforementioned support will be resilient unless breaking beyond it will reverse the trend back to 91.50 levels.
Gold prices have been consolidating without new trend movement last week.
The market moved from 1,640 to 1,6800 ranges while affected by the euro and USDX sentiments.
This week, we reckon the market may break into new trend while we observe the two extremes at 1,650 and 1,675 levels.
No clue yet for the imminent trend but the confirmation of the violation will probably extend another US$30 range beyond.
Crude Palm Oil Futures (FCPO) on Bursa Derivatives weakened further due to record stock inventories and strengthening ringgit.
The March delivery contract closed at 2,366 with approximately 45,000 contracts on Friday.
This week, we remain bearish outlook with the support maintaining at 2,300 levels and the upside resistance still caps at 2,450 areas.