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The Cyprus financial crisis continues to fester and the market place remains uneasy about it. Russia had indicated it could bail out Cyprus, but reports said talks between Russian and Cyprus officials have ended without any agreement. A second vote on a financial bailout plan by the Cyprus parliament is scheduled for Friday. This plan would involve bank restructuring and placing restrictions on financial transactions. The European Central Bank says it has funds ready for a Cyprus bailout, but insists there needs to be an EU-backed financial plan in place by Monday. There is now talk of Cyprus being booted out of the European Monetary Union. The market place will head into the weekend with keener uncertainty, which is a bullish underlying factor for the safe-haven gold market.
There was more weak European Union economic data released Friday, and it came from the strongest country in the EU. German business confidence showed a surprising drop in March after rising sharply in February. The Ifo business confidence index dropped to 106.7 in March from 107.4 in February. The Euro zone remains mired in economic recession, which along with the Cyprus financial crisis has pushed the EU problems back to the front burner of the market place.
The U.S. dollar index is trading weaker Friday morning, on some profit taking. The U.S. dollar bulls still to hold the overall technical advantage. Meantime, Nymex crude oil futures prices are firmer early Friday. The crude oil bulls and bears are back on a level near-term technical playing field. These two key “outside markets” will continue to have a significant daily influence on gold and silver prices.
There is no major U.S. economic data due for release Friday.
The London A.M. gold fixing is $1,611.50 versus the previous London P.M. fixing of $1,613.75.
Technically, gold futures bulls have gained some fresh upside near-term technical momentum recently to suggest a near-term market bottom is in place. But the bulls have more work to do in the near term to suggest the fledgling near-term price uptrend on the daily bar chart can be sustained. The gold bulls’ next upside near-term price breakout objective is to produce a close above solid technical resistance at $1,619.70. Bears' next near-term downside breakout price objective is closing prices below solid technical support at $1,575.00. First resistance is seen at this week’s high of $1,616.50 and then at $1,619.70. First support is seen at $1,600.00 and then at this week’s low of $1,589.60.
May silver futures bears have the overall near-term technical advantage, but prices have also been trading sideways and choppy for four weeks as the bulls have stabilized the market. This price action could be “basing” at lower price levels that can put in market bottoms and eventually kicks off price uptrends. Bulls’ next upside price breakout objective is closing prices above solid technical resistance at $29.495 an ounce. The next downside price breakout objective for the bears is closing prices below solid technical support at this week’s low of $28.40. First resistance is seen at the overnight high of $29.17 and then at this week’s high of $29.325. Next support is seen at $28.85 and then at $28.53.
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Asad Rasheed
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For more information please visit our website: www.cfb.aeHere are some useful links that you can follow:
Direct:04-3841906
Email:asad@cfb.ae
Email:info@cfb.ae
For more information please visit our website: www.cfb.aeHere are some useful links that you can follow:
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