Crude oil edges higher to 74.33 in Asian session despite the fact that both US and European bourses were down last Friday. USD's slide against the euro makes the commodity more appealing. However, sovereign crisis in the Eurozone is not yet over and investors should not be overoptimistic due to increased risk appetite. Crude oil have a dramatic month in May, with WTI futures jumping to a 19-month high at 87.15 and the slumping to a 10-month low at 64.24 while Brent crude also rallied to 89.58 before sliding to 68.18. European deficit problems are by all means the most important reason. At the same time, stubbornly high level of Cushing stockpile caused the spread between WTI and Brent crude widened to more than -$5/bbl, the biggest since February 2009, in mid-May. Gold continues trading narrowly below 1220. The yellow metal will be in consolidative mode for sometime but outlook remains strong as worries over fiscal deficit problems reignited. As driven by strong investment demand, gold will likely record a monthly gain of +2.57%, following a rally of +5.94% in April. Others in the precious metal, however, likely underperform gold this month due to their cyclical nature. Silver, after rising for 3 consecutive months, by around +10%, since February, will decline in May amid concerns over economic slowdown. PGMs eventually experience a meaning correction after surging relentlessly for almost a year. For platinum, after making a 6-year low in October 2008, price has been moving in an uptrend. Price only dipped -1.97% and -0.89% in April 2009 and June 2009 respectively. This month's correction of -10% is warranted but should not yet reverse long-term bullishness in the metal. Palladium is poised for fall -17% this month and the deeper correction is a result of a stronger rally since the beginning of 2009. Price has almost 3-folded without a single losing month since January 2009. Again, May's correction is healthy should not affect long-term outlook of palladium. Trading will be thin today as both US and UK markets are closed on holiday. Yet, we are going to have a busy week with the Bank of Canada and the Reserve Bank of Australia meeting for rate decision Tuesday. US ISM indices for manufacturing and services sectors will be released on Tuesday and Thursday, respectively. On Friday, US non-farm payrolls and unemployment rate for May will be released. Commitments Of Traders Crude Oil: Net speculative long positions plunged, by -40%, for the 3rd week to 40.4K in the week ended May 25. Rapid contagion of Eurozone's sovereign-debt problem triggered worries over global economic recovery while continuous crude oil inventory builds with Cushing stock reaching record highs gave little confidence over oil fundamentals. During the week WTI crude oil fell below 70. Natural Gas: Net speculative short positions decreased for a 4th week despite price decline. The Gas storage rose less than 5-year average as driven by higher heating demand in the Northeast. The market also speculates higher cooling demand this summer. Gold: Net speculative long positions dipped to 227.7K as traders took profits and used the cash earned in gold trading to cover margin calls elsewhere. Silver: Net speculative long positions slid after rising to a 4-month high in the prior week. The decline was due to concerns over silver's industrial demand as economy slows down. Platinum: Net speculative long positions plummeted -35% to 15.0K, in tandem with sharp decline in platinum price.

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