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-- Posted Thursday, 7 December 2006 | Digg This Article

GOLD	SILVER
COMEX GOLD FEBRUARY FUTURE -- $633.00	COMEX SILVER MARCH FUTURE -- $1352.0
EXPECTED TRADING RANGE
GOLD -- $625.10 -- $643.70	SILVER -- $1305 - $1405.00
COPPER AND CRUDE OIL -- EXPECTED TRADING RANGE
COPPER MARCH -- $310.60 - $329.40	NYMEX CRUDE OIL  DECEMBER - $61.25 - $67.20
GENERAL MARKET CONDITIONS
The short term rise in gold seems to be a boom to bust story and investors not yet been convinced about the rise. This week’s fall in not good for gold and silver in the short term and there could be further unless next week unless spot gold closes over $636.00 on Friday. Illiquid markets over the thanksgiving resulted in technical break out and gold edging higher. However gold did not have ammunition to rise after failure to edge past $650.0. We still believe that any five percent declines form the current levels should be used as opportunity to reenter gold. Silver just had a technical correction and as long as March future holds $1246 the bullish trend till remain intact.   As we had mentioned earlier this week that due to a weakening US dollar Opec nations might be forced to switched to other currencies on purchasing power parity. This is becoming true with Iran, the world's fourth-largest oil exporter, planning to reduce its use of the U.S. dollar in world trade and increase use of the euro. Iran’s main source of revenues is crude oil and natural gas exports. If Iran follows other anti US nations could follow the same. The US in order to prevent Iran from reducing the billing in US dollars could use the Iran’s nuclear and sanctions and bargain on the same. This political battle to main the supremacy of the US dollar will continue. The beneficiary will be gold and silver and they will soon be de-linked from the US dollar.   A huge aluminium holding by a U.S based hedge fund could squeeze supplies and trigger a price surge, especially if that fund manages to boost its holdings. Markets are buzz with speculation that  one player has recently built a dominant position and now controls between 50% 80% percent of available, on warrant, stocks of aluminium at London Metal Exchange (LME) warehouses. As commodity prices rise the annualized return will fall, especially in the second quarter of 2007. If one invested in commodities in 2005 then he is easily getting a return of over 50%. This may happen for those long term investors who invested in commodities in the second quarter of 2006. Commodity trade is the new investment kid and is attracting more and more money. However if new sources of investment come up then there could be outflows.   Markets will once again be looking forward to the US economic numbers and the US dollar for direction.
GOLD -- FEBRUARY FUTURE
Gold can target $614.10 if it falls below $628.50. On the higher side $637.50 and $650.60 are the resistance levels.
SILVER -- MARCH FUTURE
Silver can target $1290 and $1246 if it falls below $1329. On the higher side $1366 and $1403 are the resistance levels.
Happy Profitable Trading
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prices of specific currencies, precious metals, base metals, or equity indices reflect the views
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for any losses incurred in connection with any decision made, action or inaction taken by any
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errors in, or omissions of Information.

-- Posted Thursday, 7 December 2006 | Digg This Article

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