Fundamental News: August 21, 2013
Statistics Canada revealed a disappointing Wholesale Trade data yesterday. Sales slumped 2.8 percent to CAD48.8 billion in June, much worse than the 0.5 percent decline expected by analysts. This is the first decline since December and the worst reading since January 2009’s 3.9 percent decline. Weaker sales were seen in all subsectors, with the largest declines seen in the miscellaneous as well as the building material and supplies subsector. Ontario led the decline in 7 provinces as it accounted for nearly 70 percent of the total sales decline.
There were no key economic data releases during the Asian session.
In the UK, Office for National Statistics said Public Sector Net Borrowing stood at –GBP1.6 billion in July, following a GBP10.5 billion revised reading in June. CBI Industrial Order Expectations turned flat in August, better than the -8 reading expected.
Later, traders will certainly keep an eye on the release of US Existing Home Sales and the Federal Reserve’s Federal Open Market Committee Meeting Minutes. Thursday is the most news-packed day of the week.
Gold held its $1,352 low yesterday and went on to close the day in the green. Today, the trading range has tightened further and stayed near yesterday’s closing price at $1,370. Price could see a jolt of volatility later or tomorrow during the US FOMC Meeting Minutes and the first day of the Jackson Hole Symposium. $1,350 and $1,400 are the key areas in the near-term.
As mentioned yesterday, we expected a bigger move as the range has tightened in the last few days. The $108 level has held and sellers took the opportunity to dump price all the way through $105. The $3 move today does not seem to be over, though; buyers should expect more selling if $105 gives way completely.