Crude oil and gold prices are likely to bounce with the S&P 500 on optimism that Greece will successfully pass austerity measures unlocking new EU/IMF funds. Commodities – Energy Crude Oil to Follow S&P 500 Higher Ahead of Greek Vote WTI Crude Oil (NY Close): $91.16 // +0.14 // +0.15% A pickup in risk appetite promises to boost crude prices to start the trading week after S&P 500 stock index futures reversed Asia-session gains in early European hours to hold firmly in positive territory ahead of the opening bell on Wall Street. The surge of optimism appears linked to expectations that the Greek parliament will approve a new austerity plan this week, paving the way for another round of EU/IMF aid. Indeed, Prime Minister George Papandreou survived a confidence vote last week that gave him the mandate to negotiate the deal with full knowledge that further belt-tightening would be expected.This suggests implicit approval for the package has already been secured, with this week’s vote tally being little more than ceremonial for practical purposes. The upswing may be cut short by US Consumer Spending figures however, with expectations calling for the smallest increase in close to a year (0.1 percent). A bounce sees initial resistance at $92.11, with a break above that exposing $94.49. Near-term support lines up at $89.17. Commodities – Metals Gold May Bounce on US Dollar Weakness Spot Gold (NY Close): 1502.65 // -18.75 // -1.23% Prices found support at the $1500 figure, a psychological barrier reinforced by the 50% Fibonacci extension level, and seem likely to bounce along with a recovery in risk appetite. The US Dollar has been the safe haven of choice over the past three weeks as fears of an imminent Greek default roiled the markets. A recovery being hinted in S&P 500 stock index futures positioning (as noted above) threatens to weigh on the greenback, amounting to de-facto upward pressure on the yellow metal given that its global market price is denominated in the US currency. A bounce from current levels sees initial resistance at $1514.03. Importantly, long-term positioning argues for weakness, classifying any bounce now as likely corrective. Spot Silver (NY Close): $34.29 // -1.02 // -2.88% Silver has taken out support at $34.78 – the 23.6% Fibonacci extension level – exposing the 38.2% boundary at $32.24. Continued losses may be delayed however if a recovery in risk appetite materializes as expected, weighing on the safe-haven US Dollar and putting upward pressure on silver in the process. The 23.6% Fib remains as near-term resistance, with a break back above it targeting $36.34. Near-term support is $33.53, the May 16 daily close.

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