-- Posted Thursday, 22 June 2006 | Digg This Article

GOLD	SILVER
COMEX GOLD AUGUST FUTURE -- $595.80	COMEX SILVER JULY FUTURE -- $1049.50
EXPECTED TRADING RANGE
GOLD -- $573.50 -- $623.40	SILVER -- $1008.20 - $1182.00
COPPER AND CRUDE OIL -- EXPECTED TRADING RANGE
COPPER JULY -- $300.30 - $342.30	NYMEX CRUDE OIL AUGUST  - $67.60 - $72.20
MULTI COMMODITY EXCHANGE OF INDIA (MCX)
GOLD AUGUST FUTURE/10 GRAMS	SILVER JULY FUTURE/KG
Rs.8,640- Rs.9,200	Rs.15,425 - Rs.17,200
COPPER JULY FUTURE	CRUDE OIL JULY FUTURE
Rs.303.65 - Rs.348.40	Rs.3,140 - Rs.3,3380
GENERAL MARKET CONDITIONS
A combination of higher US equity markets, tensions in the Korean peninsula and a weaker US dollar spiked up gold and silver. Gold August rose to a high of $596.50 while silver July future rose to a high of $1054.0. Copper remained subdued while crude oil is once again back over $70.00 a barrel. The Iranian and Korean tensions cannot be buried for long in the mindset of investors if their respective regions which is resulting in higher physical demand of gold and silver from these regions. The US dollar is weaker as the markets expect the European central bank (ECB) to raise interest rates in August.   If gold holds $585.60 and silver holds $1041.00 on closing basis a large number of shorts will get squared off which will result in further gains for gold and silver. Traders were going short on expectations of further fall in gold to $540 zone and silver around $1900-$1920 zone. This bearish strategy may well backfire and the short covering will break some of the key short term resistances $613.60 and $1162 for gold and silver. Once the technical resistances are breached and held, the technical traders will give support to gold and silver. Now from speculative demand to fundamental demand will further support gold and silver. Interest rates hikes by the Fed, ECB and the Bank of Japan have been factored in by the markets so any calls for interest rates hikes in August or September will not affect bullion.   Most of the US companies have their subsidiaries in emerging economies like India, China, Brazil etc. For these companies its their subsidiaries which will help them maintain the growth rates which should lift up US and global equity markets. Higher equity markets will support commodity prices in the short term. In the long term gold and silver will be de-linked from everything and rise on their own.   There has been a slight tussle between Japanese commodity traders and their European counterparts. For more than a week, if Japan drives up gold, European traders try to bring it down and vice –versa. This tussle may well be over the due to increase in carry trade. Gold and silver need to close over $585.60 and $1041 on Friday for further gains next week. The next two days are very crucial for gold and silver.
GOLD
The first hurdle of $585.60 is over and now gold needs to close over $613.60 and $637.80 to target $700 once again. On the lower side apart from $585.60, $572.20 and $566.40 are the supports.
SILVER
Silver needs to hold $1041 on closing basis and also break $1071 to test the key resistances of $1162 and $1246 respectively. $1008 is the initial support with $974.00 as the key support.
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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.
Prepared By Chintan Karnani. Web Site:www.insigniaindia.com

-- Posted Thursday, 22 June 2006 | Digg This Article

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