The weakening of US Dollar against the EURO has continued in last few days and this has brought huge boost to the commodities especially Gold. The prices are still away from the $ 1000 mark yet the strength of EURO has helped the prices in maintaining northwards journey.

Gold for August settlement was up $7.30 at $962 an ounce on the COMEX division of the New York Mercantile Exchange. The dollar was weighed down by the fears that leading emerging countries could stop buying U.S. debt.

Meanwhile MCX Gold contract maintained the range bound momentum. Gold ended at Rs 14665 per 10 grams up Rs 70. Today the prices are expected to trade in range of 14525-14720.

 
Gold futures rallied in the early Asian trades today as the dollar lost floor against all the major rivals today. There are bunch of data releases from Europe and US today, which will result in wide movement in the Euro – USD pair.

Yesterday the U.S. Treasury Department said that it will allow 10 banks to repay $68 billion of TARP money that they received last October during the financial panic. The U.S. Treasury did not name the banks, but they were JPMorgan Chase, Morgan Stanley, American Express, Goldman Sachs, Bank of New York Mellon, BB&T Corp., Capital One Financial, Northern Trust Corp., State Street Corp., and U.S. Bancorp. The U.S. reported 330,477 bankruptcies in the first quarter of 2009, the most for any quarter since 2005. This pulled the currency lower yesterday.

An ounce of Gold on COMEX Division of the New York Mercantile Exchnage is trading at $ 961.3 up $6.6 per ounce. The traders are suggested to take a long position on dips with target around 964 and 968 levels.

MCX August contract is trading higher by RS 43 at Rs 14650 per 10 grams. The day traders may enter long around 14630 or CMP and exit around 14680 and 14710 levels.

Today’s economic calendar contains German CPI and French and Italian industrial production, from US we have beige book, federal budget balance, weekly oil inventories, trade balance and speech by FOMC member Lacker.

Oil Firm; May Face Stiff Resistance Ahead Of Inventories 
 
Crude oil futures are trading higher today as the equities rallied and the US dollar tumbled below the 1.4000 Euro mark today. However the counter is expected to face sell off every time it touches the $71 mark.

Today the Energy Information Administration is due to release its supply data. According to a survey from Platts, a global energy information provider, analysts expect a 800,000 barrel increase in crude inventories last week, on the heels of a 2.9 million barrel build in the week ended May 29.

Another boost to oil prices was a commodities research report released Monday from Société Générale that raised its price forecasts because of possible improvement in the global economy. The financial services company raised its third-quarter price forecast by $8.50 to $65 a barrel, and its fourth- quarter estimate by $11.50 to $72.50.

Yesterday, the DOE kept its estimate of 2009 world crude oil consumption unchanged at 83.7 million barrels per day, but increased its average price estimate for West Texas crude in 2009 from $51.70 to $58.70.

NYMEX crude benchmark futures contract is trading at $70.86 up 85 cents. The counter is expected to face stiff resistance near the $71 mark and also knowing that the inventories are expected to show an increase will keep a tab on prices today.

MCX June 15 expiry contract is up Rs 55 at Rs 3353 per barrel. It may face a resistance near 3375 levels with the weakness in Rupee also supporting the sentiment for Indian commodities. The traders may follow the sell on rallies strategy with target of 3325.