Gold & Silver Prices – Daily Outlook February 1

Gold and silver prices ended January with very moderate changes as silver slightly declined and gold rose.  The Euro and AUD also didn’t do much yesterday as the market still awaits for headlines from the Greek debt negotiations. Today, Portugal will sell short term bonds. These events might affect the direction of the precious metals prices via the forex markets. Currently gold and silver are rising. Today, the U.S. ISM Manufacturing PMI will be published; other publications include: U.S. non-farm payroll ADP estimate; Australian Trade Balance report.     

Here is a report of major news and events, and an analysis of metals prices for Wednesday, February 1st:

Gold and Silver– February Update

Gold price slightly rose on Tuesday by 0.35% to $1,740.4; silver slipped by 0.14% to $33.79. During January, gold rose by 11.08% and silver by 19.15%.

The chart below presents the changes of prices of gold and silver during the past couple of weeks (the metals are normalized to 100= January 13th).

Gold price forecast & silver prices 2012 February 1The ratio between gold and silver slightly increased on Wednesday, January 31st and reached 52.32. During January the ratio declined by 6.78% as silver has slightly outperformed gold.

Ratio Gold price  & silver prices 2012 February 1On Today’s Agenda

ADP estimate of U.S. non-farm payroll: ADP will estimate the U.S non-farm payroll report that will be published on Friday. The actual report tends to be negatively correlated with gold and silver;

U.S. ISM Manufacturing PMI: This report will refer to the manufacturing sector for January. In December, the index increased by 1.2 points to 53.9%; this index might affect the forex market (see here my review of last report);

Australian Trade Balance: The upcoming report will refer to the changes in December. In November, the export of non-monetary gold sharply increased by $358 million (32%); if the gold exports will continue to rise in December, it might suggest a rise in demand for non-monetary gold that could explain the recent rally in gold (see here last report);

Forex Market / Gold & Silver Market – February 

The Euro/U.S Dollar slightly fell on Tuesday by 0.46% to reach 1.3083 – this was the second consecutive day the Euro traded down; today’s progress in the Greek debt negotiations and the Portuguese debt sales might influence the direction of the Euro; if the Euro will rally from its recent tumble against the U.S Dollar it could indicate that precious metals prices will continue their upward trend. Currently, the Euro/USD is trading slightly up.


Current Gold and Silver February 1st

Gold price per ounce (March 2012 delivery) is traded at $1,745.2 per t oz. a $4.8 or 0.28% increase as of 08:59*.

Silver price per ounce (March 2012 delivery) is at $33.565 per t oz – a $0.303 or 0.91% increase as of 08:59*.

(* GMT)

Gold and Silver Forecast

Gold and silver prices ended January with very little changes despite their sharp rally throughout most of the month. On the first day of February this rally might continue if there won’t be a substantial shift in the fundamentals (e.g. the upcoming news and reports won’t show shocking changes). Nevertheless, I speculate, the bullish sentiment will start to subside, especially after the FOMC’s decision to keep rates low, which was among the key factors pressuring gold and silver up in late January, was already incorporated into the precious metals prices. 

Here is a reminder of the top events and reports that are planed for today (all times GMT):


13:15 – ADP estimate of U.S. non-farm payroll

15:00 – U.S. ISM Manufacturing PMI

15:30 – EIA Crude Oil Market Report

2:30 – Australian Trade Balance

For further reading: