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Gas flares, gold falls and rare moves in the metals market
Commodities moved lower during the course of the week as the diverging outlook between EM and DM economies continued to raise uncertainty about demand. Losses were driven by falls in both precious and industrial metals. The energy sector was generally positive with natural gas prices flaring up.
Extreme volatility in natural gas reached new levels over the week. Over three days the trading range exceeded 12%; resulting in volatility spiking to almost 100%. Forecasts of milder weather should take the heat out of the market.
Gold returned to the lower end of its current range with the near-term outlook pointing to some additional weakness. The positive pull from risk aversion related to the EM market turmoil gave support early on but continued FED tapering, relatively strong US growth and a stronger dollar reversed that.
Having failed to break above resistance at 1272 the risk is now that a move below 1230 will open up the downside, initially to 1220 and then 1200
01:16 minutes
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