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-- Posted Monday, 26 November 2007 | Digg This Article | Source: GoldSeek.com

INSIGNIA CONSULTANTS
Precious Metals Market Update for 26th November, 2007
GOLD				SILVER
COMEX GOLD DECEMBER FUTURE -- $826.60				COMEX SILVER -- DEC FUTURE -- $1485.0
	Lower	Expected	Higher		Lower	Expected	Higher
BUY	786.50	810.80	842.00	BUY	1417.00	1464.00	1516.00
SELL	794.50	836.40	855.90	SELL	1439.00	1509.00	1542.00
EXPECTED TRADING RANGE
GOLD DECEMBER   -- $810.0 -- $842.00				SILVER  DEC   -- $1440.0 - $1550.00
COPPER AND CRUDE OIL -- EXPECTED TRADING RANGE
COPPER DEC   -- $288.00 - $316.00				NYMEX CRUDE OIL   - $96.35 - $102.60
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GOLD DECEMBER TECHNICAL LEVELS
SUPPORT				RESISTANCE
	S2	S3	S4	R1	R2	R3	R4
$796.80	$804.90	$816.30	$824.70	$836.40	$843.80	$855.90	$865.60
SILVER DECEMBER TECHNICAL LEVELS
SUPPORT				RESISTANCE
S1	S2	S3	S4	R1	R2	R3	R4
$1,378.00	$1,417.00	$1,436.00	$1,463.00	$1,494.00	$1,509.00	$1,526.00	$1,542.00
COPPER DECEMBER  TECHNICAL LEVELS
SUPPORT				RESISTANCE
S1	S2	S3	S4	R1	R2	R3	R4
$278.30	$282.00	$287.10	$296.00	$304.00	$308.40	$314.40	$316.60
GENERAL MARKET CONDITIONS
Last Wednesday I had written that those who were going on holiday until Monday will dare not go short. I was right as gold, silver and other precious metals have risen sharply since then. The US dollar is expected to weaken further in the balance twenty five trading sessions of 2008. Over the past fifteen years, more than eighty percent of the time the US dollar has weakened in December which is expected to continue in 2007 as well. The US dollar has weakened as the Fed is expected to cut interest rates next month and may even cut interest rates further in the first quarter of 2008. We expect the Fed to pause after December and wait to cut interest rates only in March.  By then the European Central bank will also change its interest rate outlook to neutral which should result in short term top for the euro/usd. Gold also should form a top by March only to fall thereafter.
In 2007, Indian gold prices fell to INR 8550 which should be the bottom for the next three to five years. Indian gold prices fell to INR 8550 primarily due to a stronger rupee and the Indian rupee will be volatile in 2008. It will not be one way traffic for the rupee in 2008. We expect the RBI (Indian central bank) to cut interest rates by quarter of a percentage in April 2008 and October 2008 which will reduce the interest rate differentials and reduce arbitrage flows in India. Indian rupee can gain to 35-35.50 against the US dollar and yet weaken to 43.0 in 2008. Equity flows into Emerging markets like India will be near the 2007 peak, but will remain susceptible to global risk aversion. In 2008 we expect Indian physical gold prices to average INR 9675-INR 9730 per ten grams.
There will be periods of high volatility in gold and movement of the Indian rupee will be the key determinant for gold prices. Indian gold demand should rise at least ten percent from 2007 demand and we do not see higher prices, a deterrent to low consumption. Interest rate cuts should keep the Indian economy flying high. The only risk to economic growth in India is a sustained outflow from Indian equities and resumption of a bear trend for Indian equities, which seems highly unlikely at the moment.
DAILY TRADING STRATEGY
Remain on the sidelines despite the bullish trend and buy gold on any $20 dip or sell on any $20-$22 rise stop loss $4 each. Buy silver on dips stop loss below $1440
GOLD -- DECEMBER FUTURE
This time gold will definitely break $850 if it crosses $845 and rise to $885. On the lower side as long as $800-$810 holds, downside will be limited.
SILVER -- DECEMBER FUTURE
Silver targets $1515-$1526 and a break of the same will result in $1582 and $1654 in short term. On the lower side as long as $1440 holds downside will be limited.
COPPER -- DECEMBER
Copper has been holding key long term support of $277 and needs to break $308.40 for $321 and $335. Copper should bottom out this week.
NYMEX CRUDE OIL --  FUTURE
Crude oil can test $109 and $122 as long as $92 holds.
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 Monday, 26 November 2007 | Digg This Article | Source: GoldSeek.com

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