GOLD SILVER COPPER CRUDE: Commodity Technical Outlook

GOLD
Gold moved lower overnight to open at 1231.50/1232.50. It  climbed to a high of 1242.50/1243.50 as the U.S. Core Price Index  remained flat and global stocks dipped. It then declined to a low of 1227.00/1228.00 as investors turned cautious ahead of the  two-day FOMC meeting starting today as speculation continues on  the timing of the tapering down of the Fed’s monthly bond-buying  program. The metal concluded the day at 1230.50/1231.50.
Gold closed lower today at 1230, continuing to trade in its  sideways range. Support is at the recent 1210 low, and resistance  is at the recent 1268 high. The bear trend remains in place, thus  there is still risk of a test of the major 1180 low.
Gold dropped as investors shed some bullish bets on expectations that the U.S. Federal Reserve may be poised to trim its bullion-friendly economic stimulus
Expectations that Fed will curtail its stimulus programme, which has driven gold prices higher by pressuring interest rates and fuelling fears of inflation
SPDR Gold Trust said its holdings fell 2.08 tonnes to 816.82 tonnes from 818.90 tonnes.

Technical Levels

	SUPPORT 1	SUPPORT 2	RESISTANCE 1	RESISTANCE 2
GOLD	1228	1218	1237	1243
SILVER	19.77	19.47	20.00	20.30
COPPER	3.3585	3.3500	3.3770	3.3870
CRUDE	96.84	95.47	97.74	98.27

SILVER
Silver edged lower overnight to open at 19.73/19.78. It surged to a  high of 20.11/20.16 before declining to a low of 19.73/19.78 on  the back of gold and concluded the session at 19.85/19.90.
Silver also closed lower, at 19.85. Support is at the recent low of  18.90, and resistance is at the recent 20.51 high. Although the  metal made a “higher low” at 19.30 last week, it is much too early  to conclude that silver is trying to reverse out of its bearish trend.  The risk remains for a test of the major low at 18.23.

The gold-silver ratio is trading lower again today at current 61.92.  The ratio made a “lower high” at 62.61 on Friday, and so in the  very near-term, we could see the ratio trade back towards its  uptrend support line, which currently comes in at around 60.15.  There is also support at 61.06, the 38.2% retracement of the  August downtrend.
Silver declined as investors awaited a Federal Reserve meeting due to start later in the day to gauge the timing of stimulus cuts.
Data showing flat U.S. consumer prices in November also pressured prices.
Investors remained cautious ahead of the outcome of the Fed’s two-day policy meeting on Wednesday.

COPPER
On the Comex division of the New York Mercantile Exchange, copper futures for March delivery traded at USD3.329 a pound during European morning trade, down 0.02%. Comex copper prices climbed to a session high of USD3.335 a pound earlier, the strongest level since October 22.
Copper prices were likely to find support at USD3.300 a pound, the low from December 16 and resistance at USD3.353 a pound, the high from October 22.
The March contract settled 0.53% higher on Monday to end at USD3.329 a pound after upbeat manufacturing data out of the euro zone and the U.S. boosted optimism over the global economy.

Investors remained cautious ahead of the outcome of the Fed’s two-day policy meeting on Wednesday, with some expecting the central bank to announce a small reduction in the pace of its USD85 billion-a-month asset purchase program.
Copper futures were little changed near a seven-week high on Tuesday, as market players prepared for the start of the Federal Reserve’s policy meeting later in the day and news on the fate of the central bank’s bond-buying program.
Copper gained ahead of the start of the Fed’s policy meeting and news on the fate of the central bank’s bond-buying program.
Inflation data for US and European released were viewed as signs that the UK, US and eurozone were pressured by low inflation.
The bloc and Germany’s ZEW Economic Sentiment Index for December soundly exceeded forecasts and November’s readings.

CRUDE
On the New York Mercantile Exchange, light sweet crude futures for delivery in February traded at USD97.58 a barrel, up 0.11%, after hitting an overnight session low of USD97.27 and a high of USD98.15. The February contract settled up 0.87% at USD97.77 a barrel on Monday.

Late Tuesday, The American Petroleum Institute, an industry trade group, said its own data showed that crude stocks fell by 2.5 million barrels last week. Investors were also awaiting the release of official oil and refined products inventories by the EIA on Wednesday as well.
Many investors remained in standby mode ahead of the Fed's Wednesday announcement on monetary policy as well as the fate of stimulus programs such as monthly bond purchases, which have supported oil for over a year by softening the dollar.
Oil prices rose in Asia on Wednesday as the market awaited the outcome of the Federal Reserve policy meeting.
Crude oil slipped ahead of a U.S. Federal Reserve meeting in which the central bank may decide to scale back its stimulus programme.
Prices got some support on news that Libya had not reopened several oil-exporting ports.
Today crude oil inventories: EXP: -2.4M PREV: -10.6M. Actual is at 9.00PM.

Global Economic Data

TIME	DATA	PRV	EXP	IMPACT
7.00P.M	Building Permits	1.04M	0.99M	STRONG
7.00P.M	Housing Starts		0.95M	MEDIUM
9.00P.M	Crude Oil Inventories	-10.6M	-2.4M	MEDIUM

Building Permits

Source	Census Bureau (latest release)
Measures	Annualized number of new residential building permits issued during the previous month;
Usual Effect	Actual > Forecast = Good for currency;
Frequency	Released monthly, about 17 days after the month ends;
Next Release	Jan 17, 2014
FF Notes	While this is monthly data, it's reported in an annualized format (monthly figure x12);
Why Traders Care	It's an excellent gauge of future construction activity because obtaining a permit is among the first steps in constructing a new building;
Also Called	Residential Building Permits;
Source	Census Bureau (latest release)

Housing Starts

Source	Census Bureau (latest release)
Measures	Annualized number of new residential buildings that began construction during the previous month;
Usual Effect	Actual > Forecast = Good for currency;
Frequency	Released monthly, about 17 days after the month ends;
Next Release	Jan 17, 2014
FF Notes	While this is monthly data, it's reported in an annualized format (monthly figure x12). This data is slightly overshadowed by Building Permits because they are tightly correlated and a permit must be issued before a house can begin construction;
Why Traders Care	It's a leading indicator of economic health because building construction produces a wide-reaching ripple effect. For example, jobs are created for the construction workers, subcontractors and inspectors are hired, and various construction services are purchased by the builder;
Source	Census Bureau (latest release)
Measures	Annualized number of new residential buildings that began construction during the previous month;

Crude Oil Inventories

Source	Energy Information Administration (latest release)
Measures	Change in the number of barrels of crude oil held in inventory by commercial firms during the past week;
Usual Effect	No consistent effect - there are both inflationary and growth implications;
Frequency	Released weekly, 4 days after the week ends;
Next Release	Dec 27, 2013
FF Notes	While this is a US indicator, it most affects the loonie due to Canada's sizable energy sector;
Why Traders Care	It influences the price of petroleum products which affects inflation, but also impacts growth as many industries rely on oil to produce goods;