-- Posted Friday, 4 August 2006 | Digg This Article

GOLD	SILVER
COMEX GOLD DECEMBER FUTURE -- $657.20	COMEX SILVER SEPTEMBER FUTURE -- $1215.50
EXPECTED TRADING RANGE
GOLD -- $636.30 -- $672.50	SILVER -- $1172.0 - $1270.00
COPPER AND CRUDE OIL -- EXPECTED TRADING RANGE
COPPER SEPTEMBER -- $352.40 - $378.30	NYMEX CRUDE OIL AUGUST  - $72.65 - $78.10
MULTI COMMODITY EXCHANGE OF INDIA (MCX)
GOLD OCOTBER FUTURE/10 GRAMS	SILVER SEPTEMBER FUTURE/KG
Rs.9,740- Rs.10,040	Rs.18,250 - Rs.19,400
COPPER AUGUST FUTURE	CRUDE OIL AUGUST FUTURE
Rs.339.60 - Rs.372.50	Rs.3,480 - Rs.3,620
GENERAL MARKET CONDITIONS
Copper, zinc and other base metals fell along with gold and silver after a U.S. tropical storm did not turn into a hurricane as some forecasters had predicted and the bank of England raised interest rates unexpectedly. Gold December future fell to a low of $650.50 before settling higher at $664.60 while silver September future fell to a low of $1201 before settling at $1209.00.  Comex copper September future took a bashing as it fell to a low of $343.25. The US dollar is steady but still looking bearish.   Gold fell after december future was unable to hold the key short term technical support of $658.50. Silver remained firm but September future was unable to break the key short term technical resistance of $1237.00. Intra day traders are buying on dips but are not holding their positions for long and are booking profits quickly.  The reason is the Fed meeting. Markets are slowly factoring that the Fed will not raise interest rates, however we expect a surprise in the form of higher interest rates as crude oil prices are still higher.   Iranian officials have said that crude oil prices could reach a high $200 a barrel if UN imposes sanctions on Iran. Geopolitical risk and higher crude oil prices will continue to support gold and silver prices. Bank of Italy’s has decided to switch a quarter of its foreign exchange reserves into British pounds.  We doubt that this is a trend unique to Italy alone.  Many more central banks are diversifying out of the dollar into currencies such as the Euro, British and Japanese Yen. More and more central banks are slowly increasing their gold reserves as an hedge against US dollar depreciation. Gold and silver will continue to rise and that sharp declines or pullbacks should be used as an opportunity to go long.     Despite the bullish trend, I will still prefer to trade in technical. Gold still needs to hold $657.00 and silver $1192 on closing basis. Higher stop losses is the need of the hour as volatility will increase due to US July non farm payroll numbers.
GOLD
Gold needs to close over $658.50 to continue its bullish direction else a fall to $638-$640 is on the cards. On the higher side $668.80 is the initial resistance with $679.80 and $696.10 as the key resistance.
SILVER
Silver needs to break $1236 for $1304 and $1385.0. On the lower side $1292 is the initial support with $1162 as the key short term support.
Happy Profitable Trading & A Great Weekend.
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-- Posted Friday, 4 August 2006 | Digg This Article

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