-- Posted Wednesday, 21 February 2007 | Digg This Article

GOLD	SILVER
COMEX GOLD APRIL FUTURE -- $664.10	COMEX SILVER MARCH FUTURE -- $1383.50
EXPECTED TRADING RANGE
GOLD -- $656.00 -- $670.00	SILVER -- $1355.0 - $1410.00
COPPER AND CRUDE OIL -- EXPECTED TRADING RANGE
COPPER MARCH -- $254.40 - $264.00	NYMEX CRUDE OIL  MARCH   - $57.20 - $59.90
GENERAL MARKET CONDITIONS
Yesterday’s profit taking is another example of Japanese investment in commodities. Ultra low interest rates and cost of carry has resulted in investors borrowing in yen and investing in other financial instruments. Traders booked profit ahead of the Bank of Japan decision on interest rates. Yesterdays profit taking is good news for sustainability of the medium term bullish trend. If gold and silver were to rise continuously weeks after weeks then the fall would have been severe and it would have taken more weeks to pare the losses.   Chinese control over copper and base metals can be seen as they fell on profit taking. Chinese markets are closed due to New year celebrations. Comex copper March future is expiring next week. There will be short covering which could push copper, zinc and other base metals higher as we near future expiry. Copper will be volatile over the coming few months. On one hand new supplies will start to pour in by June which could prevent sharp gains while on the other hand expectations of stronger global growth and greater speculative interest could result in higher prices. Bulls and bears will fight it out in copper. Zinc and Aluminum will outperform copper in the remaining ten months of 2007.   US is sending its second aircraft carrier to the Persian Gulf. The deployment of additional naval forces ``is here to help foster stability and security in the region,'' Rear Admiral Kevin Quinn, commander of the naval force, said in the statement.  It seems US is preparing for a war with Iran. The Bush administration is under pressure over Iraq in a democrat controlled Congress. It may use attack over Iran as a diversionary tactic. Any armed attack over Iran will have far more serious long term repercussions than Iraq. It may further antagonize the global Islamic population which could result in higher geopolitical risk and gold, silver and crude oil rising.
GOLD -- APRIL FUTURE
Failure of gold to break $680 this week will result in a retest of $650 and $630 next week. While a consolidated break of $680 will result in $700 and $730 over next three to four weeks.
SILVER -- MARCH FUTURE
Failure of silver to break $1437 this week will result in a fall to $1330 and $1305 next week. While a consolidated break of $1437 will result in $1530 and $1600 over the next three to four weeks.
Happy Profitable Trading
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-- Posted Wednesday, 21 February 2007 | Digg This Article

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