Greece Woes Weigh On Metals

Greece Woes Weigh On Gold And Silver

May 21 • Forex Precious Metals, Forex Trading Articles • 5607 Views • Comments Off on Greece Woes Weigh On Gold And Silver

Greece’s woes may continue to weigh on metal prices but, slight improvement in investor sentiments post G-8 has provided the “Euro” currency to gain 0.12 percent early morning and may continue in today’s session.

The Dollar index has also weakened 0.11 percent on Friday after gaining consecutively for the last 13 days may continue to deteriorate further after weak Chicago Fed national activity index and may support other currency buying among metals complex.

Therefore, after losing year till date gains base metals might remain positive in today’s session due to strong equities coupled with better investor sentiment.

Gold futures prices continued its ascending move after some tough sessions and the Asian equities markets also revived as investors risk appetite enhanced after the ECB and European commission confirmed progress on Greece emergence scenarios.

The Market therefore seems to get a breathing space as the G8 leaders respect Greece to stay in the Euro zone but forced them to balance austerity with growth. Euro therefore got a firm footing against the dollar and supported the metal at Globex session.

However, we still need to be cautious whether the heightened debt levels and the probable re-elected party will be able to suffice their commitments. For the time being, Gold is expected to remain strong owing to the ease of tension for Greek exit. The G8 has cleared for a balance necessity for Greece which might market some sense of relief.

Therefore, investors will be eyeing the upcoming European summit on May 23 and comments about the Greek re-election. Since the first election was discarded due to the anti-bailout protest, we doubt whether the newly elected party will be opting for the austerity measures promised earlier. Hence, Euro might find its weakness once again anticipating the same.

 

Forex Demo Account Forex Live Account Fund Your Account

 

So, gold may also remain conservative in its upward move. There are no such economic releases are scheduled from the globe except the Chicago Fed NAT activity index. We expect it to remain weak and that may support gold price in the evening.

Nevertheless, we hope the metal would have released the strain for the time being and are likely to remain strong with moderate gains. Hence, we recommend staying long for the metal.

Silver futures prices however are quoting slightly down from the prior closing. Although the Asian equities rebound after the G8 meeting confirmed Greece’s presence in the Euro zone, we still doubt whether the country will be able to maintain its commitments regarding austerity. Hence, market will be eyeing the May 23 European summit.

Silver is therefore likely to have a conservative move during the day. But the Euro’s rebound is expected to keep silver prices up. With absence of any economic releases from the globe, we recommend remaining long for the metal at lower prices.

Comments are closed.

« »