Dot Commodity Weekly Market Review Januar 23-27

TOCOM Gold

Prices of TOCOM gold futures surged last week as the most actively traded forward contract gained 145 yen or about 3.5% per gram. The forward contract closed Friday’s day trading session at 4260 yen after reaching as high as 4321 earlier in the day. Prices rose inTokyobecause of a weakening yen versus the U.S. dollar early in the week and then a rise in the price of the U.S. dollar spot price later in the week. The U.S. dollar spot price rose after the U.S. Federal Reserve Bank announced that they would keep interest rates at current historically low rates at least until 2014. This weakened the U.S. dollar against many major currencies and pushed the price of spot gold to a one month high. With interest rates at such low levels, negative real interest rates will continue which in turn keeps the opportunity costs of holding gold low. Many analysts also now expect the Fed to implement more quantitative easing this year and this added to the bullishness on gold. Additionally, Chinese New Year is finishing up and demand in physical markets inAsiais expected to pick-up. Some central banks are also expected to continue their purchases of gold this year. All of this together has given a level of bullish sentiment in precious metal markets. Trading volume of gold futures on TOCOM was low early in the week and picking up some later in the week. Open interest fell by around 3,000 contracts and stood at 117,760 as of last Friday.

TOCOM Gold Daily Chart – Forward Contract (as of Jan 27)

 

TOCOM Gold Forward Contract Weekly Trading Data

Date

Open

High

Low

Close

Change

Volume

Open Interest

Jan 27

4274

4321

4250

4260

-12

60908

117760

Jan 26

4190

4295

4155

4272

82

67146

120910

Jan 25

4160

4190

4144

4190

32

38076

123426

Jan 24

4140

4167

4128

4158

13

35902

121957

Jan 23

4120

4152

4086

4145

30

38056

121787

 

TOCOM Platinum

Prices of platinum futures also rose last week on the back of higher gold prices and labor problems affecting production inSouth Africa. The most actively traded forward contract rose by 219 yen or about 5.8% per gram last week and closed the week at 4008 yen. Platinum futures prices on TOCOM have strongly rallied over the past few weeks after dropping below 3,500 yen in late December. Workers at the world’s second largest platinum producer, Impala Platinum, went on strike earlier this month at one of their mines and this has hurt curtailed production. Global platinum supply and demand is still expected to be in surplus in both 2012 and 2013 by most analysts but ongoing labor problems and increasing production cost inflation could change expectations going forward. Market participants are also still watching developments inEuropeclosely as platinum is used in diesel engine exhaust systems which are popular there. Palladium is used more often in gasoline engine exhaust systems. Trading volume was moderate last week and open interest fell slightly to stand at 40,117 contracts as of last Friday.

TOCOM Platinum Daily Chart – Forward Contract (Jan 27)

TOCOM Platinum Forward Contract Weekly Trading Data

Date

Open

High

Low

Close

Change

Volume

Open Interest

Jan   27

3964

4055

3958

4008

39

15039

40117

Jan 26

3903

3987

3882

3969

61

15625

40904

Jan 25

3880

3910

3858

3908

30

12328

41554

Jan 24

3802

3898

3792

3878

71

14873

41546

Jan 23

3792

3826

3746

3807

18

10843

42356

 

TOCOM Rubber

Rubber futures prices on TOCOM also gained last week albeit less than gold and platinum. The most actively traded benchmark forward contract gained 1.3 yen per kilogram last week after closing the day trading session last Friday at 315.8 yen which was also the low for the day. The forward contract hit a high for the week of 324.6 yen during Thursday’s trading which was a 3 month high. However, prices fell 7.7 yen during Friday’s trading as some traders closed profitable long positions before the weekend ahead of economic data was due to be released in the U.S. and a stronger yen against the U.S. dollar. Prices of natural rubber rose on TOCOM and in other Asian markets last Tuesday and Wednesday after the Thai government announced that they approved plans to buy up to 200,000 metric tons from Thai producers at above market prices to support local farmers and producers. However, the market is still expected to be in surplus in 2012 after having a deficit last year which led to historic highs last year. Trading volume was moderately low and open interest dropped slightly by about 1,500 contracts and stood at 26,850 as of last Friday.

TOCOM Rubber Daily Chart – Forward Contract (Jan 27)

TOCOM Rubber Forward Contract Weekly Trading Data

Date

Open

High

Low

Close

Change

Volume

Open Interest

Jan 27

324.0

324.0

315.8

315.8

-7.7

9261

26850

Jan 26

324.0

324.6

319.6

323.5

2.9

9115

27218

Jan 25

313.9

321.1

313.9

320.6

6.0

7012

27582

Jan 24

306.0

315.3

305.1

314.6

9.1

6130

27227

Jan 23

315.0

315.0

304.5

305.5

-9.0

8008

27630

 

Exchange and Industry News

 No news this week.

Disclaimer:

This market review and news report contains information and data from sources believed to be reliable and accurate as of the date of publication but has not been independently verified. This report is for informational purposes only and no employee, director or connected person to Dot Commodity, Inc. takes any responsibility for the information or correctness of the content contained in the report. Dot Commodity, Inc. is strictly an online commodity futures broker and does not give any trading recommendations or financial advice to any of its clients, perspective clients or readers of this report. No part of this market review & news report is to be construed as an offer or solicitation to buy or sell any commodity futures or financial contract or product of any kind.