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-- Posted Wednesday, 6 August 2008 | Digg This Article | Source: GoldSeek.com

INSIGNIA CONSULTANTS

Asian Metals Market Update for 6th August, 2008

GENERAL MARKET CONDITIONS

The Federal Reserve kept its benchmark interest rate at 2% and signalled that weak employment and financial instability will delay any increase in borrowing costs. This says the Fed is on the hold for the rest of the year. The next move may be up, but it won't occur for a while. If US economic growth does not live up to expectations then a rate cut could be in the offing. In short, the Fed will not raise interest rates in the remaining months of 2008. The European central bank and bank of England will also not raise interest in 2008. Interest rate differentials will be the same for the rest of 2008 between the US and Europe. It should be technical trade for the rest of year with focus only on growth. The US dollar will get battered if and only if growth differentials widen.

Since 2004 gold and silver have always fallen in August and early September only to have an endless rise between the October to April period. If history were to repeat itself then one should use the current dips and further dips in gold and silver to invest for the medium term. I will prefer to go by history. However in the short term if crude oil continues to fall then gold and silver will also fall. Some traders expect crude oil to fall to $110 and $100 in the short term. If crude oil nears $100 then gold prices will fall below $850.

COPPER -- SEPTEMBER FUTURE -- INTRA DAY PIVOT: $354.0

Copper needs to hold $332 and $339 to target the 200 day MA around $354.

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.

Nothing in this article is, or should be construed as, investment advice.

-- Posted Wednesday, 6 August 2008 | Digg This Article | Source: GoldSeek.com

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