-- Posted Tuesday, 12 June 2007 | Digg This Article

GOLD	SILVER
COMEX GOLD AUGUST FUTURE -- $658.20	COMEX SILVER JULY FUTURE -- $1325.50
EXPECTED TRADING RANGE
GOLD AUGUST  -- $653.00 -- $666.20	SILVER  JULY  -- $1302.0 - $1354.00
COPPER AND CRUDE OIL -- EXPECTED TRADING RANGE
COPPER JULY   -- $327.10.00 - $343.90	NYMEX CRUDE OIL  JUNE    - $64.20 - $67.40
GENERAL MARKET CONDITIONS
Once again base metals and energies came to the rescue of precious metals. Copper rose three percent on strike by mine workers at Codelco and Collahausi. Global inventories of copper are not very high. For most part of 2006 copper prices were supported by hanging sword of mine worker strikes which is continuing in 2007.  There is something fishy abut mine worker strikes which in view is induced by company’s management along with support form hedge funds. Whenever copper nears a technical break down, mine worker threat appears sooner than later which pushes up prices. There is a over leverage in copper by hedge funds and the stakes for profits as well as losses are very high. None of the hedge funds would like to another amaranth or a red kite of copper. Markets have factored in a robust global growth. One need to be very cautious in investing in copper as the incremental return will be lower than past two years average. Zinc will be outperformer in base metals on greater demand from automobile sector of emerging nations like India, Brazil and the like.   US 10 year yields are floating over the five percent mark. I sill have a doubt as to how long will they stay over five percent. Sooner than later demand should come up which will push yields below five percent. At the moment investors are just digesting over five percent yields and are unable to decide whether to switch to treasuries from other investments. If US equity markets rise this week then investor preference will be for stocks and if they fall then bonds. A rise in treasury will adversely affect gold and silver prices while a rise in equity markets will be positive for gold and silver.
GOLD -- AUGUST FUTURE
Gold needs to break $663.50 for $668.50 ad $673.10. On the lower side $651.50 is the key support and a consolidated fall below $651.50 will result in $646.70.
SILVER -- JULY  FUTURE
Silver needs to hold $1304 to prevent further losses to $1292 and $1277. On the higher side $1324 is the initial resistance with $1339 and $1354 as the key resistances.
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-- Posted Tuesday, 12 June 2007 | Digg This Article

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