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-- Posted Monday, 30 April 2007 | Digg This Article

GOLD	SILVER
COMEX GOLD JUNE FUTURE -- $682.60	COMEX SILVER JULY FUTURE -- $1361.50
EXPECTED TRADING RANGE
GOLD JUNE -- $673.00 -- $690.00	SILVER  JULY  -- $1330.0 - $1405.00
COPPER AND CRUDE OIL -- EXPECTED TRADING RANGE
COPPER JULY   -- $344.10.00 - $364.00	NYMEX CRUDE OIL  JUNE    - $63.80 - $68.00
NATIONAL COMMODITIES AND DERIVATIVES EXCHANGE (NCDEX)
GOLD JUNE FUTURE/10 GRAMS	SILVER JUNE FUTURE/KG
Rs.9135- Rs.9,9348	Rs.18,680- Rs.19,426
COPPER MAY FUTURE	CRUDE OIL MAY FUTURE
Rs.317.40 - Rs.335.00	Rs.2,791 - Rs.2871.00
GENERAL MARKET CONDITIONS
The US dollar is in the paper shredder as it continues to fall against the euro, sterling and other major currencies except the yen. The fall in the US dollar was reinforced by slump in first quarter US GDP growth rate of 1.30%, the lowest in four years. Carry traders make merry on US economy as interest rate differential between US and other nations widen. Market are slowly factoring in the worst for the US economy which suggest that a short term bottom should be formed on the US dollar Index by the second week of May. The question is not over the weakness of the US dollar, but that of the speed of weakness. The faster the speed of weakness of greenback, the faster is the chance of a correction and vice – versa. One needs to be very cautious as euro nears 1.40 or sterling nears 2.03 and should rather buy some put options as an hedge. I keep on mentioning over and over that the world is switching from a US dollar standard to a gold standard and this is one of the prime reason for the long term bullish direction in gold (apart from demand supply economics).  Analysts were witnessing the same in 2006, now is the turn of the investor to experience the same.   The US equity markets rise as US economy slows. US companies made huge profits in their home countries and are high on cash. They are now buying smaller companies which were a nip in the bud and also investing in emerging markets like India, brazil and the like. As a result their global incomes are rising which is helping them to secure higher growth rates. Mergers and acquisitions are going to continue in 2007 also which will support stocks. Exceptionally warm weather and lower crude oil prices in the first quarter in northern hemisphere increased the profits for the US companies. I doubt whether US companies will be able to maintain their first quarter growth rates in the second quarter as crude oil prices are higher and wage price rise slows down. We expect a correction of fifteen percent from the highs created in May for every major global market by July. Initial sharp fall in stocks will adversely affect gold and silver prices.   Geopolitical risk has resurfaced. Oil installations in Saudi Arabia and other parts of middle east has always been under constant threats. US and its allies have been terrorizing the terrorists to give up arms and this guerilla warfare will not stop. There is a also a danger of a coup between the rulers in Saudia Arabia which if starts to show could result in wild swings in crude oil prices. Geopolitical risk will only increase the volatility in precious metal prices.   Markets will be looking for the US April  payrolls number for yet another directional on the US dollar. The worst news has been factored. If the US April payrolls numbers comes in better than expected one should expect sharp gains in the US dollar and fall in gold prices.
GOLD -- JUNE FUTURE
Gold is back to square one as it needs to break $690.00-$700.30 for $707 and $735. On the lower side $678.0 is the initial support with $669.50 as the key intra day support.
SILVER -- JULY  FUTURE
Silver needs to break and hold $1387 for $1404 and $1437. On the lower side $1330 and $1306 are the supports.
Happy Profitable Trading
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-- Posted Monday, 30 April 2007 | Digg This Article

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