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-- Posted Tuesday, 30 January 2007 | Digg This Article

GOLD	SILVER
COMEX GOLD FEBRUARY FUTURE -- $642.70	COMEX SILVER MARCH FUTURE -- $1324.00
EXPECTED TRADING RANGE
GOLD -- $632.00 -- $654.00	SILVER -- $1288.0 - $1372.00
COPPER AND CRUDE OIL -- EXPECTED TRADING RANGE
COPPER MARCH -- $248.00 - $262.10	NYMEX CRUDE OIL  DECEMBER - $53.00 - $56.20
GENERAL MARKET CONDITIONS
Copper and Zinc fell nearly four percent on rising London Metal Exchange (LME) inventories and concerns that demand will fall from 2006 high. Traders were going long in copper and zinc on expectations that Chinese demand will pick up as they near the Chinese New Year next month which did not happen. This resulted in liquidation of long positions. Nickel rose on supply disruptions. Lower crude oil prices will result in robust global growth in 2007. Fundamentally base metals will remain bullish. However there is liquidity overhang all over the world. In 2006 we saw that due to excess liquidity there was too much money chasing too few investment opportunities, which result in base metals and energies falling after a phase of rapid rise. The worst looser were the retail investor which buys at the peak and sells at the lowest level. Japan will not increase interest rates as retail spending does rise consistently.  If the US trade deficit continues to widen and there Fed does not get enough subscribers to its treasury bonds then it will print more dollars to run the US economy thereby adding to the global liquidity. Higher global liquidity always results in boom to bust scenario for any investment. Gold and silver will never be busted as they are now being slowly considered as an alternative to the printed paper money by various central banks.   Gold and silver fell due to profit taking ahead of the Fed meeting. The US dollar still has failed to gain significantly resumption of central bank foreign exchange diversification theory. Russia reiterated their plans to diversify their reserves into the Euro, Sterling and Yen at the expense of the US dollar.  Aside from Russia, there is speculation that many central banks have orders to diversify their reserves. The key short term as well as long term supports have been held by both gold and silver which will result in the bullish trend remaining intact.
GOLD -- FEBRUARY FUTURE
Gold needs to break $660 for further gains. On the lower side as long as $636 holds on closing basis the downside is limited. A consolidated fall below $636 will result in $628.
SILVER -- MARCH FUTURE
Silver needs to break $1370-$1380 for further gains to $1425. On the lower side as long as $1317 and $1300 hold on closing basis the downside is limited. A consolidated fall below $1300 will result in $1252.
Happy Profitable Trading
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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.

-- Posted Tuesday, 30 January 2007 | Digg This Article

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