XAU/USD is close to the peak
Forecast 11 - 15 of January:
So, the gold has reaffirmed its commitment to growth in the first month of the year. In my view, period of growth is about to finish and we expect the downward trend to emerge soon. The last week, XAU/USD showed growth on the background of geopolitical risks, as well as outflow of capital from risky assets. For some time, investors forgot about reduction of inflationary pressures in the G-7 economies. On the basis of the last five days, Oil sank to its lowest level since May 2004, which caused a strong reduction in the yield of 10-year US government bonds and reflect investors' inflation expectations. Even the positive data on reduction of the crude oil reserves in the United States as well as reported cut of the number of drilling Baker Hughes rigs did not help black gold market to recover its lost ground. Decline of inflation expectations usually has a negative impact on prices of the yellow metal, and in my opinion, investors will not ignore this strong factor for too long. So, this week we should open Sell positions with XAU/USD on growth of quotations to 1111/1124 and take profit around 1075.
XPT/USD and XPD/USD:
During the week we should open short positions for two reasons. Firstly, the release of US car sales December report disappointed investors. Total score dropped to the lowest level for the five months, indicating a possible peak of consumers activity in the United States. Growth paces of car sales was very high and this trend can not last forever. The car industry ensures a major demand for both metals and therefore, we can expect reduce of the number of orders from major players in the market. Secondly, weak PMI data on manufacturing sector of China indicate that the player №1 in the global car market will also give ground. China was the country which contributed to collapse of quotations of the platinum metals last week. Investors are pessimistic on the entire range of commodity assets: in the last five days, CRB Index lost 4.29%. Thus, a strong negative background for industrial metals is being formed and therefore, trading along the trend is most efficient strategy. So, this week we should open Sell positions with XPT/USD on growth of quotations to 890/902 and take profit around 861 as well as open Sell positions with XPD/USD on growth of quotations to 513/538 and take profit around 488.
Macroeconomic releases published the last week were contradictory. On the one hand, ISM figures and manufacturing sector data as well as the report on trading balance indicate slowdown of growth paces of the US economy. On the other hand, high employment level in the agricultural sector says that it is too early to expect negative trends on the US economy. The coming week will not be so eventful in terms of release of macroeconomic statistics. Only on Friday interesting reports will be published: the reports on retail sales and consumer confidence. A strong labor market says that we can expected releases based on consensus forecast, which will render a short-term support for the US stock market. It is impossible to ignore outflow of capital from risky assets which is caused by fears of slowed Chinese economic growth. On Friday, the People's Bank of China, trying to stabilize the situation revaluated RMB against the US dollar. Chinese stock market closed in green zone on Friday. At the same site, Northern American and European exchanges ignored this factor. Dynamics of fear index S&P500/VIX indicates that, after another decline we can expect that traders will take actively profit on short positions and corrective movement in the stock market in the United States will develop. This week we expect flat within the range 1870-1975.
Alexander GoryachevAnalyst of «FreshForex» company
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