-- Posted Wednesday, 16 August 2006 | Digg This Article

GOLD	SILVER
COMEX GOLD DECEMBER FUTURE -- $634.50	COMEX SILVER SEPTEMBER FUTURE -- $1213.00
EXPECTED TRADING RANGE
GOLD -- $618.40 -- $652.50	SILVER -- $1172.0 - $1256.00
COPPER AND CRUDE OIL -- EXPECTED TRADING RANGE
COPPER SEPTEMBER -- $352.40 - $378.30	NYMEX CRUDE OIL AUGUST  - $70.80 - $75.80
MULTI COMMODITY EXCHANGE OF INDIA (MCX)
GOLD OCOTBER FUTURE/10 GRAMS	SILVER SEPTEMBER FUTURE/KG
Rs.9,620- Rs.9,740	Rs.18,280 - Rs.19,150
COPPER AUGUST FUTURE	CRUDE OIL AUGUST FUTURE
Rs.352.00 - Rs.372.50	Rs.3,320 - Rs.3, 480
GENERAL MARKET CONDITIONS
Silver continues to outperform gold as it continues to rise.  Silver is an industrial cum precious metal and fundamentally provides more value to the long term investor at the current levels. Gold demand is mainly for jewellery and hedge against uncertainties. The year on year return on silver investments will be much higher than gold. Silver is metal for investment for a period six months to two years. It’s average volatility is more than gold and so is the favorite for intra day traders and .jobbers.  Gold is a better option for the low risk traders.   Foreign demand for US treasuries rose from $63.6 billion to $75.1 billion in the month of June, driven primarily by an increase in private demand.  Foreign central banks were net sellers of US Treasuries, confirming that reserve diversification is indeed underway. Aside from the UK, no one was a major buyer. Japan, the world's largest holder of US Treasuries actually sold Treasuries for the fourth month in six. US needs nearly $2 billion to run its economy. China is not selling US treasuries and as it is dependent on exports to US and if China sells the Fed will have to print more US dollar bills to run its economy or resort to protectionism. Both scenario gold and silver will rise. The rise will be genuine whereas the rise in US equities could be manipulated.   There has been a resumption of yen-funded carry trades as well as other commodity currencies carry trade. A weaker US dollar will result in increased carry trade once summer trading is over. Gold, silver and other metals will immensely benefit from the same. Crude oil prices are still not in the bear grip unless there is a sustained fall below $70.00 a barrel. One should use the August dip to buy far dated future on dips and also buy call options.
GOLD
Gold needs to hold $634.00 to prevent losses to $621.00. On the higher side $642.50 is the initial resistance with $652.50 and $657.50 as the key short term resistances.
SILVER
Silver is trading in $1172- $1258 range and should break free of the range soon. Silver needs to break $1237 and $1257 for $1320. On the lower side $1192 is the initial support with $1172 as the key short term support.
Happy Profitable Trading
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-- Posted Wednesday, 16 August 2006 | Digg This Article

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