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-- Posted Tuesday, 6 May 2003 | Digg This Article

June Gold:  Close = $342.8 +$.20

During mid-session prices hit highs not seen since early March, but by the close they backed off and prices settled only inconsequentially higher.  The Fed predictably left rates unchanged, stocks rallied but lost steam, the energy markets lost much of yesterday’s gains, and it appears 4-year lows in the US dollar gave gold bulls a slight boost.

Recently, layoff announcements were reported to have increased 70% from last month, and manufacturing, productivity and employment numbers continue to disappoint.  Consumers remain cautions, stock investors are still gun-shy, business remains hesitant to hire and the two-year downtrend in the US dollar is persisting.  If economic variables remain stagnant to bearish, gold could find the legs to reach $400 this year.

The driving force behind gold’s recent rally off $324 remains a weaker US dollar, but don't expect the dollar to just roll over and capitulate each day.  Look for bounces in the dollar to pressure gold lower, and those occasions might offer good buying opportunities in gold.  Prices are above the 50-day moving average and technicals are headed higher, although they are approaching overbought levels.  Odds suggest gold will correct a bit before trudging higher.  Look for a stab higher and then for the market to correct a bit and repair the indicator…in other words…for lower prices to attract more buyers.  If long with TradeScope, be sure to follow along and keep stops tight.  We’re still looking to 347 as a near-term target, with support now 337.9.  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.
 
July Silver:  Close = 480, -1.5-cents

What wasn’t done yesterday was accomplished today…silver hit a fresh high, a level last visited in early February.  Although, by the close the luster escaped and prices retreated to close just a smidgen in the red.  The weakness in the US dollar initially allowed gold and silver some breathing room on the upside, but the bullish grip on prices eased near the close.  Prices could be hitting congestion in the 481 area, 462 is the next support level.  There is also bearish divergence on some technicals and odds may favor a correction this week.  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 Tuesday, 6 May 2003 | Digg This Article

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