-- Posted Tuesday, 26 October 2004 | Digg This Article

 

GOLD				SILVER
GOLD DECEMBER FUTURE -- 429.90				SILVER DECEMBER FUTURE -- 734.0
	Lower	Expected	Higher		Lower	Expected	Higher
BUY	421.20	425.60	433.50	BUY	704.50	728.50	744.50
SELL	424.80	433.00	450.00	SELL	720.00	743.50	759.50
EXPECTED TRADING RANGE
GOLD -- 421 -- 433.00				SILVER -- 715 - 760.0
GENERAL MARKET CONDITIONS
It’s the question whether US dollar will continue to be world’s reserve currency. The question of US dollar dominance over other currencies has to be answered. The reason is that the fundamentals of the US economy are weak (But better than Eurozone and Japan) and foreign interest to continue financing US economy seems to be waning. Asian and other central banks which till have had a greater part of their investments in US treasuries have now started looking for alternate avenues. For example in India the government is considering giving foreign exchange loans those corporates who are trying to raise overseas loans in the form of External Commercial Borrowing (ECB) and the like and prevent these corporates from bringing fresh flows and at the same time manage the huge forex reserves efficiently.                   Also Oil needs to be continued to be billed in US dollar. If the US dollar continues to depreciate then in real terms the oil exporting countries are getting lesser amount for their exports.  The US government has no option but to increase speculative interest so that oil prices to remain high and oil continues to billed in US dollar. If oil is “Not Billed” in US dollar then nobody will finance the US economy and it will be ripped apart. The US policy makers put the blame game on China and India. It is just like Indian and Pakistani politicians not resolving the Kashmir issue deliberately so that they remain in power.          Renewed jump in oil prices following strike threats by a Norwegian ship owners’ association also intensified worries of an oil-driven US slowdown and a case for a greater demand for precious metals.       Once the focus shifts to from US economic fundamentals to economic growth the US economy will be winner. The outcome US elections results may not be known on 2nd November at the moment. We expect the October payroll numbers on 5th November to be near 1, 75,000 and that should give a strong boost the US dollar.       The CFTC data showed that the net long position in gold and silver futures were at their highs level since mid-April.
GOLD…..
Gold needs to break 433 and hold on to it for four hours to target 450. Only a daily close below 421.50 will result in losses.
SILVER…..
Silver yesterday touched a high of 753 but was unable to hold on to it. It once targets the same. A convincing break of 750 should result in 775. On the lower any fall below 715 will attract demand.
Happy Profitable Trading
Disclaimer : Any opinions as to the commentary, market information, and future direction of prices of
specific currencies and precious metals reflect the views of the individual analyst, In no event shall
Insignia Consultants or its employees  have any liability for any losses incurred in connection with any
decision made, action or inaction taken by any party in reliance upon the information provided in this
material; or in any delays, inaccuracies, errors in, or omissions of Information.
Prepared By Chintan Karnani. Web Site:www.insigniaindia.com

-- Posted Tuesday, 26 October 2004 | Digg This Article

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