Fundamental Analysis

Crude oil prices rose on Wednesday despite the huge rise in crude oil inventories according to the EIA report, which showed crude oil stockpiles increased by 5.3 million barrels well above expectations, nonetheless, crude oil were still higher, as rising speculations of QE3 continued to boost demand for higher yielding assets including crude oil. Traders will be eyeing more data from the U.S. labor market with the weekly jobless claims, in addition to the ISM manufacturing, and if the data signals more weakness, traders are likely to increase their bets of QE3, which should provide crude oil prices with more bullish momentum. Thursday August 01: From the United States the data will start at 12:30 GMT with the weekly jobless claims after they rose 417 thousand last week. The ISM Manufacturing is due at 14:00 GMT for August and expected to contract with a drop below 50 at 48.5 from 50.9. 

Gold prices were slightly lower on Wednesday, where rising optimism in markets boosted demand for higher yielding assets, and accordingly, reducing demand for safe assets including gold, which put gold prices under pressure, nonetheless, rising speculations of QE3 put also downside pressure on the U.S. dollar, which limited the losses for gold, since gold is seen as a hedge against a weakening dollar. Traders will be eyeing more data from the U.S. labor market with the weekly jobless claims, in addition to the ISM manufacturing, and if the data signals more weakness, traders are likely to increase their bets of QE3, which should provide gold prices with bullish momentum overall. Thursday August 01: From the United States the data will start at 12:30 GMT with the weekly jobless claims after they rose 417 thousand last week. The ISM Manufacturing is due at 14:00 GMT for August and expected to contract with a drop below 50 at 48.5 from 50.9. 

Natural gas prices rose on Tuesday after forecasters signaled that Tropical Storm Katia could approach the Gulf of Mexico, which might affect supply from refineries, where the National Hurricane Center signaled Katia may be near hurricane intensity, and accordingly, natural gas prices rose on supply fears. Traders will continue to examine the Tropical Storm Katia, and whether it will affect supply from the Gulf of Mexico, since if that proves to be the case, we should expect natural gas prices to rise further.

Gold prices rebounded to the upside on Tuesday, as pessimism dominated markets over the outlook for global growth after worse than expected data from all around the globe, especially consumer confidence in the United States after it fell sharply in August, which boosted demand for lower yielding and safe assets, providing gold prices accordingly with bullish momentum. Traders will be eyeing key data on Wednesday, especially the ADP employment report, which could provide some hints ahead of Friday’s Non-farm payrolls, and if the ADP shows weak employment, we should expect gold prices to extend the rally on Wednesday.

Crude oil prices fell on Tuesday, as pessimism dominated markets over the outlook for global growth after worse than expected data from all around the globe, especially consumer confidence in the United States after it fell sharply in August, which weighed down on demand for higher yielding assets, pushing crude oil prices to drop. Traders will be eyeing key data on Wednesday, especially the ADP employment report, which could provide some hints ahead of Friday’s Non-farm payrolls, and if the ADP shows weak employment, we should expect the crude oil prices to drop further. Wednesday August 31:                                                         At 12:15 GMT the United States will start with the signals for Friday’s jobs report with the ADP Employment Change for August which is expected to show 103 thousand private added jobs following 114,000. Canada will release the GDP estimate for the second quarter, where Canada’s growth is expected to be flat in Q2 after an expansion of 3.9% in Q1, while the economy is expected...

Natural gas prices fell on Monday after hurricane Irene resulted in power cuts for millions, reducing demand for power-plant fuel, and accordingly, pushing natural gas prices lower. Moreover, hurricane Irene led to milder weather conditions in the East of the United States, which also weighed down on natural gas on expectations of lower demand for power-plant fuel. Traders will continue to examine the effects of Hurricane Irene and its potential impact on demand for natural gas, where if power remains out, natural gas prices should continue to drop on Tuesday.

Crude oil prices rose on Monday amid the U.S. dollar’s weakness, in addition to hurricane Irene, which so far hasn’t caused any serious damage across the U.S. East Coast. Moreover, traders were still feeling optimistic after Bernanke’s speech last week, where Bernanke signaled the Fed has the tools to support the economy if needed, which boosted speculations the Fed could embark on Qe3 as soon as their September meeting and that supported demand for higher yielding assets, leading crude oil prices to rise accordingly. Traders will be focused on the FOMC minutes on Tuesday, as after Bernanke’s speech last week; traders will be looking for more cues on whether the Fed will announce further monetary easing, and if speculations of QE3 rise over the coming period, we should expect crude oil prices to rise further on a weak dollar. Tuesday August 30: The United States will start at 14:00 GMT with the Consumer Confidence index for August which is expected to drop to...

Gold prices fell back on Monday, as rising demand for higher yielding assets weighed down on gold prices, where traders were feeling optimistic over the outlook for economic growth in the United States after the United States reported personal income and spending rose above estimates, which boosted demand for risky assets, and accordingly, pressured gold prices to drop. Traders will be focused on the FOMC minutes on Tuesday, as after Bernanke’s speech last week, traders will be looking for more cues whether the Fed will announce further monetary easing, and if speculations of QE3 rise over the coming period, we should expect gold prices to receive bullish momentum.

Gold prices fluctuated heavily last week before ending lower, where gold prices rose earlier last week to a new record high above $1900 an ounce, however, gold prices dropped back towards $1700 an ounce, as rising confidence levels reduced demand for safe assets including gold, which weighed down on prices, although gold prices were still able to rise towards the end of the week amid disappointing growth levels from the United States, and as the Fed’s Chairman Bernanke didn’t announce further monetary easing, which supported gold prices slightly. Gold prices are most likely to continue their bullish trend over the coming period, especially since the level of uncertainty remains unusually high, as beyond the debt crisis in Europe, the uncertainty surrounding the outlook for global growth is also very high, and that should further boost demand for safe havens including gold. Important data will be released next week from the United States, where the jobs report will be released, and expectations signal...

  Crude oil prices gained back last week, where optimism dominated markets earlier in the week, as rising demand for risky assets boosted crude oil prices earlier in the week, however, crude oil prices erased some of its gains after the U.S. reported slower than expected growth in the second quarter, and after Bernanke signaled the Fed will wait before they decide any new monetary easing measures, which put crude oil prices under some negative pressure. Meanwhile, the EIA report showed that crude oil inventories decreased by 2.2 million barrels below median estimates, which pushed crude oil prices to the upside. Rising pessimism in global financial markets should put crude oil prices under more pressure over the coming period, where traders are concerned the U.S. economy is heading into a double dip recession, and since the United States is the world’s largest consumer of oil, demand for oil will fall, and that continues to weigh down on prices, while concerns from the European...