-- Posted Tuesday, 2 May 2006 | Digg This Article

GOLD	SILVER
COMEX GOLD JUNE FUTURE -- $658.90	COMEX SILVER JULY FUTURE -- $1383.50
EXPECTED TRADING RANGE
GOLD -- $624.10 -- $670.60	SILVER -- $1272.50 - $1480.50
COPPER AND CRUDE OIL -- EXPECTED TRADING RANGE
COPPER JULY -- $316.80 - $352.40	NYMEX CRUDE OIL JUNE  - $70.40 - $75.20
MULTI COMMODITY EXCHANGE OF INDIA (MCX)
GOLD JUNE FUTURE/10 GRAMS	SILVER JULY FUTURE/KG
Rs.9,500- Rs.9,850	Rs.20,200 - Rs.23,200
COPPER JULY FUTURE	CRUDE OIL MAY FUTURE
Rs.304.35 - Rs.352.20	Rs.3,050 - Rs.3,325
GENERAL MARKET CONDITIONS
Gold and silver continued to scale multi year highs on looming uncertainties over the Iran stalemate and weakness in the US dollar. The US is pressing for sanctions which is basically one step before an armed attack. Gold June futures reached a high of $664.00 while silver July futures reached a high of $1413 before settling lower at $660.20 and $1396.20. The US dollar pared some of its losses after Fed chairman Bernanke said that his testimony was misread.   The world is switching from a US dollar standard to a gold standard. The US dollar was nowhere in history books as a means of trade and exchange some 300 hundred years ago. The US dollar came into prominence after World War I and more after World War II. The US rulers followed a policy of ensuring that the US dollar became a means of global trade and oil billed in US dollar which resulted in the US dollar replacing gold. The world was dependent on demand of US consumers for their export led growth. The value US dollar until a few years ago was more than gold. Now the scenario is changing as demand from India and China rise and global economic growth will be less dependent on US demand over the coming years. Crude oil is a black gold and the US administrators know that they can still rule global trade over the coming years if they have control on crude oil resources. This is the foremost reasons for pre-emptive strike on Iraq and possibly Iran and in future other crude oil rich nations. Gold, silver and other precious metals will continue to rise as a result on these geopolitical uncertainties. However there is one risk, which is that of Chinese bursting or slowdown in the Chinese economy.   Unless world finds a cheaper and mass replacement to crude oil, the world is moving towards a path of self induced recession Higher crude oil prices will result in inflation which will result in Central banks increasing interest rates and use other monetary policies to control it, which will have an adverse effect on consumption. In either scenario gold, silver and other precious metals are the winner.   Over the weekend I was in my birth city Kolkatta/Calcutta  and I had a word with some of the traders. Most of them were of the view silver prices should touch INR 40,000 per kg in 2006 and gold prices INR 14,000 per ounce in 2006. In Kolkatta there are less numbers of individuals trading in gold and silver in MCX or NCDEX as compared to Delhi or Mumbai. However individuals are stashing up physical gold and silver on every decline for investment purposes. If this phenomenon is incurring in Kolkatta, it will happen in every city in India. Demand for gold and silver from India will be rise on the even with a decline in jewelery demand.   Momentum is bullish, technically over-brought are both gold and silver. There could be some higher volatility before the next upward trend in gold and silver. Higher stop losses is important to make the most of the volatility
GOLD
Gold targets $735.00. On the lower side $652.00 is the initial support with $636.00 and $624.00 as the key short term support levels.
SILVER
Silver targets $1450.00 - $1500.00 for $1650. There is an initial resistance at $1423 and key resistance at $1480.00 and $1552.0. On the lower side $1338.00 is the key support; a fall below the same will result in $1270.
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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, 2 May 2006 | Digg This Article

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