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-- Posted Wednesday, 26 March 2003 | Digg This Article
June Gold: Close = $331, +$1.8
The war in Iraq continues through a maelstrom of controversy, and sand. Coalition forces will assuredly depose Saddam, but meanwhile the headlines will wreak havoc on the markets. By nature, markets are generally unpredictable, but the shroud of war has caused volatility to swell. As with other markets, the major influence on gold at the moment is the war, whether directly or indirectly. Economic data revealed that new-home sales sank over 8% last month, orders for manufactured luxury goods fell over 1%, airline travel is down, and Sony Music is looking to layoff thousands of employees. The economy is chugging along, but the dark cloud of terrorism continues to temper the enthusiasm of consumers. The sooner the war is over, the better for everyone…except Saddam and those in his regime. It’s improbable that any of us can accurately predict the daily machinations of the war effort. To trade gold right now one must be quick on their feet and flexible, not hesitating to get in or out at a moments notice. For longer-term investors, these hourly gyrations should be of little consequence. In fact, with much of the war premium having been chased out of gold, there are many gold bugs chomping at the bit to buy at these levels. There is a Precious Metals Investment Conference in Las Vegas this weekend, perhaps gold bugs in attendance will have so interesting ideas on how, when and where to buy gold?
Is gold in the $320’s a great value? Whether or not a wave of buyers will press prices higher is somewhat dependent on whether or not a vicious and protracted battle in Iraq takes shape. If so, it's safe to assume stocks and the dollar will slump, energies will find strength, and gold will make bulls wealthier. With so much choppy action only highly speculative aggressive traders would want to consider unhedged futures positions. Many folks might look to futures options as a way to be on board in case of a dramatic move in either direction. Prices are below moving averages, technicals suggest sloppy action…but in this tense environment traditional technical analysis may not be quite as valid. Be sure to watch TradeScope daily. Remember, with futures and options one can be short or long, feel free to contact me to discuss trading strategies. Each contract/option = 100 ounces, a $1 move in a futures contract = $100.
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.
May Silver: Close = 439.8, +.5-cents
Technicals are quite a bit oversold right now, such as oscillators like stochastics. Bulls may want to hop back on the horse and give it another go, but as always, if prices don’t rally be prepared to take a small lump. The next resistance area is now 451 or so. Certainly there is a load of room to rally but only on the shoulders of a willing gold market, but that’s the key…gold. Finally, take note of the bullish seasonal, where in 12 of the last 15 years May Silver has rallied from approximately March 18 to May 4 an average of about 11-cents. Of course, history isn’t guaranteed to repeat itself. 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, 26 March 2003 | Digg This Article
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