Easters are going to be over and summers have arrived in Asia and in northern hemisphere.Energy demand will slowly and steadily rise along with rise in temperatures. Global warming is the topic of discussion between environmentalist and politicians. Globally average temperatures are on the rise every year.There is uncertain weather pattern and meteorologist have failed to predict the same accurately. Deserts are receiving more rain, while flooded regions are experiencing drought. How does climate change effect gold and silver? The prices of agri-commodities like wheat, pulses, soybean are on the rise, specially over the past two years. If the prices of food items rise over the next few years at the current pace, most of the central banks will continue to raise interest rates or price controls (as in India) will come up in developed nations to check prices. Gold will be the biggest beneficiary as paper instruments will crumble.
Physical demand for in India as well as other parts of Asia should rise from this week till the middle of June. In India at the moment there is light demand but it should rise as the month progresses. Silver will benefit from rise in demand from use in consumer durables. Copper and other base metals should remain firm, but cautious undertone will persist as it has pushed traders on the sidelines. Market sentiment for the US dollar is negative which should support metals prices at lower levels.
GOLD -- JUNE FUTURE
Gold has broken the key resistance of $677 and could be headed for $692 and $700 as long as $668.80 holds on closing basis. A consolidated fall below $668 will result in $660 and $653.20.
SILVER -- MAYFUTURE
Silver targets $1412 and $1437 as long as $1330 holds on closing basis. A daily close below $1330 will result in $1305 and $1284 respectively.
Happy Profitable Trading
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