Daily Report 290914 2014-09-29
Gold
 
Domestic gold remained range bound last Friday, testing the performance of five-day moving average at RMB 242.5 in the short term. In terms of operations, previous short positions opened higher than RMB 249.5 could be held. From the short term aspect, the gold fluctuates increasingly violently. Sound investors are recommended to wait for the opportunity after the region from RMB 240 to RMB 244 is broken through. The assets’ prices of forex market and stocks market recently are the key elements which determine the trend of gold. On one hand, the ECB President Draghi increasingly expects to adopt the easing policy, which makes the Euro remain a  downward trend; On the other hand, the U.S. consumer confidence index and new housing sales are both better than expected. Therefore, the U.S. dollar index keeps rebounding for eleven straight weeks while the dollar-denominated gold remains weak. In terms of capital market, the gold ETF positions keeps dropping by 1.2 tons last Friday, indicating the funds are not holding an optimistic attitude of the gold. China National Day is coming this week and the U.S. PMI and non-farm payrolls are going to be released as well. Specifically, this time the non-farm payrolls are especially crucial for the Fed’s policy because the data in August is not as good as expected. New short positions are not recommended to open before the holiday. For short-term investors, it is suggested to observe the trend and wait for opportunities.
 
 
 
Silver
 
Domestic silver kept range bound last Friday as well. In the short term, the silver is above the 5-day moving average at RMB 3795. In terms of operations, previous short positions opened at RMB 4130 could be held. During the intraday trading, investors are recommended to wait for opportunities after the region from RMB 3780 to RMB 3840 is broken through. The silver trend of monthly moving average in the foreign market has already dropped below the triangle convergence region. Although it may rally and offset part of the decrease in early this week, the silver’s weak trend afterwards is unlikely to be changed. The demand of domestic silver is increasingly stronger, but it still needs corporation of fundamental news for domestic silver to drop below RMB 3,800. However, the spread between domestic and foreign market is likely to enlarge due to continuous weak foreign market. On the whole, considering the special character of silver compared with gold, it will be difficult for the silver to get out of the trend independently.
 
 
 
CSI 300 Index
 
The stock index fluctuated on Friday, with its spot trading volume shrank. Previously, the index soared till it was dragged down and fell back afterwards, but the correction pressure is not too much. Positive news, such as directional easing policy and Shanghai-Hong Kong Stock Connect, remain unchanged. Besides, the impact of funds due to the newly issued stocks has passed. Most investors tend to observe the trend and wait for opportunities before the holiday, but stock index is hardly likely to drop due to the active market atmosphere. 
 
 
Soybean
 
Last Friday U.S. soybean hit a new low since February 2010, due to the pressure of U.S. soybean harvesting. Before the Chinese National holidays, the market continues to be weak and fluctuating. While the holiday in China, foreign market is going to have six trading days. There is more market uncertainties due to the recent high market volatility, plus bearish soybean fundamentals and some important reports to be released during the period.
During holidays the following reports and data should be focused: area and quarterly inventory report at the end of September, institutions expected that USDA has exaggerated the seeding area, focus on whether the upcoming report will adjust the seeding area; If it is not adjusted, this means the expected U.S. soybean fertility is going to come true. In cooperation of the smooth harvest, the market will need more time to solve the problem of increased supply volume; after the supply is confirmed, market demand should become the priority focus. U.S. soybean export and the demand of China will be the dominant factors that affect the price. The price also is expected to stage a rebound.
However, since the demand and supply are quite loose, the rebound will have limited space. Also soybean no. 1 is more related to the new soybean listing price, and buyer’s attitude and purchase intention. Soybean No. 1 futures are still in a low price compared with the spot. Soybean meal following U.S. market weak trend, before national holidays spot market is firm but afterwards the pressure remains. In term of operation, long soybean positions with light amount of investment; keep previous soybean meal short positions before the holiday, and do not buy in new short positions.
 
 
 
 Dong LV (Investment Certificate NO. TZ008452)