-- Posted Monday, 17 July 2006 | Digg This Article

GOLD	SILVER
COMEX GOLD AUGUST FUTURE -- $674.50	COMEX SILVER SEPTEMBER FUTURE -- $1167.50
EXPECTED TRADING RANGE
GOLD -- $662.50 -- $703.50	SILVER -- $1134.0 - $1240.00
COPPER AND CRUDE OIL -- EXPECTED TRADING RANGE
COPPER SEPTEMBER -- $362.80 - $382.30	NYMEX CRUDE OIL AUGUST  - $74.80 - $80.20
MULTI COMMODITY EXCHANGE OF INDIA (MCX)
GOLD AUGUST FUTURE/10 GRAMS	SILVER SEPTEMBER FUTURE/KG
Rs.9,970- Rs.10,400	Rs.17,950 - Rs.18,900
COPPER AUGUST FUTURE	CRUDE OIL JULY FUTURE
Rs.362.60 - Rs.392.90	Rs.3,460 - Rs.3,650
GENERAL MARKET CONDITIONS
Gold is headed for $800, silver for $1650, crude oil over $100 a barrel and the US dollar could get smashed over the coming weeks IF tensions between Israel and Hezbollah militant escalate further. Syria and Iran could also be dragged into the conflict which is the prime reason for me upping the short term target for gold, silver and crude oil. There is no serious approach by big brother US president George Bush to interfere so that this stalemate comes to an end as soon as possible.   The fighting between Israel and Hezbollah militant is just a precursor to a larger war like scenario in the Middle East over the coming weeks. Hezbollah began as a guerrilla force but over the years it has evolved a complex military infrastructure. Nonetheless it has few of the types of weapons available to the Israelis. Its only long-range punch comes from an assorted arsenal of missiles. Most of these are relatively short-range systems, generically known as Katyushas, capable of striking targets out to about 25km. Israeli leaders have taken the opportunity of the Hezbollah raid which captured two of their men, to set about the full-scale weakening of Hezbollah's infrastructure. Headquarters, television stations, and missile storage bunkers have all been hit. But the Israelis have also sought to blockade Lebanon - closing Beirut's airport, striking the Beirut-Damascus highway, and hitting various key transport links, especially bridges. Israel t would like to see Hezbollah disarm and the Lebanese Army extend its control down to the international frontier. That is what UN Security Council Resolution 1559, of 2004, also demands. But is hard to see how it can be enacted.   The attack on the Israeli missile boat, one of its most sophisticated warships, a Saar-5 class corvette, also raises many questions. It was hit by a Chinese-made, radar-guided C-802 missile. Did Israeli intelligence not know that these anti-shipping missiles had been given to Hezbollah by Iran? Iran has been supplying weapons to Hezbollah and also aiding Hezbollah. Iran has been under pressure to discontinue its nuclear ambitions and may be asked to stop aiding Hezbollah militants. If Iran does not comply and continues    aid to Hezbollah, there could be war between Israel and Iran. This is just one of the possibilities which cannot be ignored by the financial markets.     The US dollar had gained the previous week. However foundation of the current US dollar strength looks weak. We have the CPI, PPI, Treasury flows, FOMC minutes and Bernanke’s semi annual testimony. Quite a week as far as US economic numbers are concerned which could be investors on their toes. Gold and silver will be unnerved and unmoved by US economic numbers. The Fed will raise interest rates in August and may be after August due to unstoppable crude oil prices. In the short term the US dollar may gain which will give yet another opportunity to short on the US dollar at lower levels.     Global equity markets tumbled last week and rising geopolitical risk could result in outflows from equities to treasuries and hard assets like bullion and real estate. However rising commodity prices will support commodity stocks which in turn will prevent any major further losses in global equities.   Gold and silver will sing the tune of Middle East tensions this week. If tensions reduce gold will fall to $648-$650 zone, else $800 looks a reality. There is a severe safe haven demand from central bankers of Middle East countries and well as people of that region. In India physical prices are quoted at a discount of $3-$4 to the landed spot price suggesting lack of demand.
GOLD
Gold targets $705.60 and $730. On the lower side $669.70 and $662.50 are the initial support levels with $ 652.50 as the short term key support.
SILVER
Silver underperformed the previous week and is a sleeping tiger which could roar anytime. Silver could rise or fall $1 in a flash. Silver faces resistance at $1192 and $1237 with $1266 as the key weekly resistance. On the lower side $1135 is the initial support with $1110 as the key short term support.
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.
Prepared By Chintan Karnani. Web Site:www.insigniaindia.com

-- Posted Monday, 17 July 2006 | Digg This Article

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