01.12.2014 - Swiss referendum resulted in the fall in prices for gold

The price of gold fell sharply today in connection with the results of the referendum in Switzerland, where the electorate voted against the increase of the part of gold reserves of the central bank of the country up to 20% versus the current value of 8%. Also, there was no support for a proposal to ban the sale of gold by the central bank. The result of the vote was expected and a drop in prices was limited. It should be noted that the production cost of gold is about $ 1100 per troy ounce. We expect the price correction in the near future and recommend to accumulate positions in gold. Our medium-term outlook remains positive.

The price of Light Sweet crude oil continues to drop after on Thursday in Vienna, OPEC countries decided to maintain the quota of oil production at 30 million barrels per day. Today, a negative factor for the dynamics of prices was the news about reducing China's PMI of 0.2 to 50.3. Given the weak demand in Europe and Asia, the growth of production in the US, easing of sanctions against Iran, we see an imbalance of supply and demand on the market, which will lead to a further decline in prices. Purchases may be resumed near the level of 60 dollars per barrel. We see no reason to change the negative trend and maintain the medium-term negative outlook.

RISK WARNING: Trading of complex financial products, such as Stocks, Futures, Foreign Exchange ("Forex"), Contracts for Difference ("CFDs"), Indices, Options, or other financial derivatives, on "margin" carries a high level of risk, and may not be suitable for all investors. The possibility exists that you could sustain a loss of some or all of your initial investment and, therefore, you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with trading these markets, and seek advice from an independent financial advisor if you have any questions or doubts. Please carefully read our full "Risk Disclosure" and "Risk Disclosures for Financial Instruments & Investment Services". FXFINPRO Capital is the trading name of PFX Financial Professionals Limited, a limited liability company formed under the laws of Cyprus, registered with the Registrar of Companies in Nicosia, Cyprus, under nr. HE 237840 and regulated by the Cyprus Securities and Exchange Commission with license number 193/13.