-- Posted Tuesday, 7 February 2006 | Digg This Article

 

GOLD	SILVER
COMEX GOLD APRIL FUTURE -- $573.50	COMEX SILVER MARCH FUTURE -- $975.50
EXPECTED TRADING RANGE
GOLD -- $562.40 -- $600.00	SILVER -- $958.50 - $1020.00
COPPER AND CRUDE OIL -- EXPECTED TRADING RANGE
COPPER MARCH -- $220.60 - $228.60	NYMEX CRUDE OIL FEBRUARY - $62.20 - $66.47
MULTI COMMODITY EXCHANGE OF INDIA (MCX)
GOLD APRIL FUTURE/10 GRAMS	SILVER MARCH FUTURE/KG
Rs.8140 - Rs.8300	Rs.13580 - Rs.14000
COPPER MARCH FUTURE	CRUDE OIL FEBRUARY FUTURE
Rs.224.20 - Rs.250.40	Rs.2870 - Rs.3025
GENERAL MARKET CONDITIONS
Gold and silver are consolidating in a range as the US dollar and crude oil prices fell. Gold April future rose to a high of $578.00 before settling at $574.30 while silver March future rose to high of $989.00 before settling at $975.80. Copper is impossible to stop as it rises $5 -$8 every day.  Expectations that Fed will raise interest rates in March as well in May has resulted in gains for the US dollar. US President Bush announced a $2.7 trillion budget for the 2007 fiscal year which begins in October.  In his projections, the deficit is expected to shrink from $360 billion predicted for this fiscal year to $355 billion.  Mr. Bush also proposed to reduce the healthcare cost which will hurt the average US citizen just the finance wars with Iraq, Afghanistan and probably Iran. Although the Bush administration still has plans to halve the budget deficit by 2009, there is a fear that interest expense could increase due to rising financing costs which could expand the budget deficit instead of shrinking it. The movement in commodity prices is all about global liquidity. The Fed and the European central bank (ECB) will the reducers in the first half of 2006 while the Bank of Japan will the liquidity reducer in the last quarter on 2006. Commodity prices are expected to follow the movement of global liquidity for the rest of 2006.  Thursday’s $14 billion dollar re-issuance of 30-year bonds, which has been necessitated by budget deficits will be key attraction as far as US treasuries are concerned.  Strong demand expected at the auction could keep the dollar bid with one wrinkle - the demand for longer dated bonds has also caused a deeper yield curve inversion with the 2-10 spread widening to 3.3 basis points. This has perked up the radar for some recession watchers. The long term US dollar bearishness and stronger commodity prices are here to stay for the moment.  As far as Iran is concerned every one including Japan, China wants a diplomatic solution for it as it an energy laden nation. Every country is trying to its is bit to prevent a war (except US) and Iran on the other hand wants to get away despite building nuclear weapons since Pakistan has also got away with the same.  The medium to long term bullishness remains intact for gold and silver with $605.00 and $1050.00 as the immediate price targets.
GOLD
Gold has been consolidating higher with $565.00 as the new support zone and is trading in $568.00 - $580.00 zone. A consolidated break of $581.00 for four hours will result in $600.00 and $625.00. Only a close below $568.00 for two consecutive days will result in further losses to $550.00 and $536.00 else the downside will remain limited to $568.00.
SILVER
Silver now targets $1000.00 and $1050.00 as it $952.00 on closing basis. It is consolidating at $975.00 at the moment. There may be a correction to $952.00 and $936.00 which will present yet another buying opportunity.
For SMS service on MCX & NCDEX trading strategies, please mail your mobile number at
sms@insigniaindia.com
Happy Profitable Trading
Disclaimer : Any opinions as to the commentary, market information, and future direction of
prices of specific currencies, precious metals, base metals, or equity indices 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.

-- Posted Tuesday, 7 February 2006 | Digg This Article

1080-81, Ugger Sen Street,”Somani Bhawan”
Sita Ram Bazar, New Delhi-110006. India.
Ph: [O] 91-11-30919880 [M] 09811139549
Website: www.insigniaindia.com
Email: chintan@insigniaindia.com

Previous Articles by Chintan Karnani, Insignia Consultants

© 1995 - 2019

Live GoldSeek Visitor Map | Disclaimer