-- Posted Wednesday, 15 January 2003 | Digg This Article
February Gold: Close = $351.1, -$1.3
The PPI was unchanged, indicating to some that inflation is tame (but don’t try to convince Jim Rogers of that!). Gold bulls were perhaps disappointed with these uncontroversial numbers and prices subsequently drifted slightly lower. Surprising API numbers shifted lots of attention to the energy markets, revealing a huge drop in U.S. commercial petroleum inventories. The dollar was a fraction lower and equities were all in the red, but all the while gold couldn't attract much attention from bulls.
More and more troops are embarking for the Middle East and Bush says he is “sick and tired of Iraq’s games”. According to the London Financial Times, Blair warned, “people who want to avoid confronting the threat of weapons of mass destruction were naive and misguided”. There are reportedly vast deficiencies in Iraq’s weapons declaration and Iraq is perilously close, if not already there, to being in material breach. North Korea continues to defy attempts to open a dialogue with the West. All and all, the international and geopolitical arena is almost boiling over.
Here’s an interesting note on energies, according to the Wall Street Journal, "U.S. commercial petroleum inventories fell by more than 100 million barrels in December, the largest drop since 1999. Inventories of crude oil accounted for a third of the drop, falling by 11 million barrels, or 4%, on the month to 276 million barrels, the lowest year-end level since 1975." It appears the Venezuelan oil strike has made its mark! If this trend continues, it’s also likely gold will continue to gain favor with buyers as economies become stifled and investors look to channel their hard earned incomes into appreciating assets.
Overall, gold technicals and fundamentals indicate further buoyancy is to be expected. In fact, corrective dips in the price of gold could be looked upon as buying opportunities. The geopolitical, financial and sentiment factors propelling the market higher are not going to evaporate anytime soon. The longer-term bullish scenario appears intact and it’s highly probable that $400 will be hit early this year. If you are long Feb futures near $317 or have several call options as per TradeScope be sure to watch daily for order adjustments. Remember, futures and options offer much flexibility as one can just as easily be short or long any market. Each contract/option = 100 ounces, a $1 move in a futures contract = $100. Contact me anytime to discuss strategies to fit your needs.
To open an account and receive trading recommendations on gold futures or options contracts (also stock indices, energies, currencies, etc.), or to use PaperTrader Online contact me at erik@altavest.com. Visit www.altavest.com to request a Free Starter Kit. Keep in mind that there is risk of loss in all trading.
March Silver: Close = 478, +1.5-cents
The uptrend in this market cannot be dismissed, but silver still lags behind gold a bit in terms of flexing its muscle. Last week we came within 5-cents of the $5.00 mark and we’re still anticipating a run to the 500 area soon, perhaps by next week. The path of least resistance appears higher but as mentioned last week, “there is some technical bearish divergence on some oscillators, therefore expect dips and use them as buying opportunities”. We’ve pulled back about 20-cents from highs and prices have formed a bull flag. Always maintain your perspective by keeping an eye on daily, weekly and monthly charts as opposed to intra-day charts. Each contract/option = 5,000 ounces, a 1-cent move in a futures contract = $50. Contact me anytime to discuss strategies to fit your needs.
To open an account and receive trading recommendations on silver futures or options contracts (also stock indices, energies, currencies, etc.), or to use PaperTrader Online contact me at erik@altavest.com. Visit www.altavest.com to request a Free Starter Kit. Keep in mind that there is risk of loss in all trading.
-- Posted Wednesday, 15 January 2003 | Digg This Article
