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Weekly Stock & Metal market reviews after 21st October, 2011.

Chinese GDP figure was slower in 3rd quarter and on the other side Germany has cut it’s growth forecast for coming year, these are not showing any better pictures for world economy. In spite all of these market is waiting to hear something good from the meetings in Euro-zone. Markets expect that all the differences between Germany and France will be solved.

21st-Oct, 2011


This week Emerging markets performed better than Developed markets, but in these days there are not much to differentiate.
I said many times during past few weeks that there are lesser trading opportunities in market. Bank of America’s reports clearly reflected, that, 3rd quarter of this year was a horrible quarter for trading.

 Oil & Metal market forecast for coming week

$90 level is acting as a good resistance for Nymex Crude (Dec). Look like Oil is waiting for something, to decide it’s path. Nymex Oil has support at $82. For Brent Crude (Dec) the resistance is at $112 and support is at $104. Natural Gas (Oct) can again test the $3.80 level, $3.50 is a good support for it.
For Gold (Oct) the level that needs to be watched is $1680 in the upside, I was expecting Gold to test $1500 level in the downside but it may take some time to test that level. Silver (Oct) can again try to test $33 level, on the downside it has support around $30 level. Copper (Oct) tried to test 3.50 level as I said but it quickly drop below it’s $3.10 support level. In coming week it may again try to test $3.40 level.

Stock market (Index) forecast for Coming week

Markets are not sure about future movements, everyone is trying to get some answer from meetings in Euro-area, I don’t think Sunday’s meeting can bring much of things, so uncertainty in the market will stay up to Wednesday. Let hope after that market will get something.
Last day DOW tried to test level above 11800 level, but as I said that it may find hard times to test 11200-11800 level. Last day it was a high volume day for DOW, which was good. Now if condition becomes better then it will break this level to test higher levels. Otherwise it will move in that range of 10500-11200.
As I said in last week DAX did the same thing, it re-tested 5800 level though in last day it rose. During last 3weeks DAX was more or less flat, now coming days can be a deciding factors for DAX. I don’t know what will be the outcome of the meetings, but it looks to me that it may drop. On the upside if it breaks 6000-6200 level then it can rise more, on the downside it has a support at 5400 level.
BOVESPA was flat, but in last day on higher expectation it went above 55000 level. 57000 is the next target but all things depend upon economical matter. If it breaks 53000 then it can test 51000 level.
Shanghai Composite broke the 2380 level in the downside and as I said in last week it has a chance to test 2300 level, it did the same thing. Some Technical indicators say that it has a chance to drop more. But if somehow market improves then it can rise from here. KLSE was flat this week and in coming week it will follow the global trend, but more chance is there for rise than drop.

Reports due in coming days

Monday, 24th October, 2011 – Chicago Fed Business Index
Tuesday, 25th October, 2011 – Home Price index, Consumer Confidence.
Wednesday, 26th October, 2011 – Durable Goods Orders, New Home Sales.
Thursday, 27th October, 2011 – Unemployment Claims, GDP, Pending Home Sales.

Friday, 28th October, 2011 – Consumer Income & Spending, Employment Cost Index, Consumer Sentiment.

I don’t know whether Fed needs more monetary easing or they are going to bring QE-3, but it is sure that policy makers are facing hard times to lower the unemployment rate and it is more now as Obama’s job bill is in deep water. US recovery is not up to the mark or better to say slower than expected. Fed is trying different things to bring down the interest rate and increase liquidity, sometime good reports are coming, but I think what really matters is the consistency. 
Today and coming Wednesday’s meetings in Euro zone are important but I am not sure about their long to medium term effect, considering the fact of 256 billion Euro aid to Greece, Ireland and Portugal in past. Black stone bought Italian bonds, now we need these types of incidents to boost up the confidence. But will that be all ?  or there will be any other country waiting next after Greece ?  Everywhere I see downgrades and all other threats are looming on smaller countries, here I will not surprise if in future something comes about France and UK.

NOTE :  Please see the disclaimer of this blog . 


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