-- Posted Wednesday, 14 March 2007 | Digg This Article

GOLD	SILVER
COMEX GOLD APRIL FUTURE -- $642.80	COMEX SILVER MAY FUTURE -- $1280
EXPECTED TRADING RANGE
GOLD -- $635.00 -- $660.00	SILVER -- $1243.0 - $1320.00
COPPER AND CRUDE OIL -- EXPECTED TRADING RANGE
COPPER MAY  -- $277.00.00 - $288.60	NYMEX CRUDE OIL  MARCH   - $59.00 - $62.00
GENERAL MARKET CONDITIONS
Yesterdays fall in equity markets and commodities reflects the amount of Japanese money everywhere which resulted in investor preference towards high risk stocks. Risk aversion has resulted in unwinding of carry traders. Bank of Japan just prints more yens and distributes it at nearly zero interest rates to ensure that Japanese economic growth rises with a weaker yen. The end result, world getting flooded with cheap Japanese money and emphasis on higher returns irrespective of the risk involved. After the March mayhem, carry will not stop but will continue at a slower pace. Interest rate differentials between various countries will continue which will promote carry trade. Investors will be taking the risk aspect into consideration while making investment decisions.   It’s more of US and Japan that is dictating the global financial services industry. US is the leader in providing innovative ways of investments while Japan is the fund manager to the same. Chinese financial services sector is still at a nascent stage. India will find more foreign investment in equities and commodities as the peak is still some more years away. Investments away from the US dollar and yen will gather momentum after the current volatility. Investors will diversify investment into non US dollar and non yen investment which could change the nature of global investment over the coming years.   The current volatility is just an early warning signal of the future break down in the value of the US dollar and move towards gold. US needs Japanese and Chinese money to fund its current account deficit and trade deficits. If the value of the value US dollar falls, gold could be the next global medium of exchange.   For the time being the fall in equities and commodities is just a correction which is a part and parcel of a long term bully rally. Only if the fall in equities and commodities continues into mid-April that there could be a medium term bear phase. The next three days are very crucial for gold and silver and based metals as well. A close below key long term supports on Friday could trigger further losses next week else these are another buying opportunity.
GOLD -- APRIL FUTURE
Gold need to close over $635.10 today to prevent a fall to $624.50 and $618.80 tomorrow. On the higher side $650 and $660 are the resistance levels.
SILVER -- MAY  FUTURE
Silver needs to close over $1230 to prevent a fall to $1209 and $1183 tomorrow. On the higher side $1310-$1320 is the resistance zone.
Happy Profitable Trading
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 Wednesday, 14 March 2007 | Digg This Article

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