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-- Posted Monday, 22 September 2008 | Digg This Article | Source: GoldSeek.com

GENERAL MARKET CONDITIONS/FUNDAMENTAL FACTOR

The Bush administration sought unchecked power from Congress to buy $700 billion in bad mortgage investments from financial companies in what would be an unprecedented government intrusion into the markets. Through his plan, Treasury Secretary Henry Paulson aims to avert a credit freeze that would bring the financial system and the world's largest economy to a standstill. The bill would prevent courts from reviewing actions taken under its authority. Basically the fed wants dictatorial power which can be misused and may backfire. Its also reflects the crisis the US is in and that over the past few years the world was shown a wrong image of financial stability in the USA. If these powers are conferred on the Fed then the effects will be felt after a period of six to eight months on the US economy. By then the USA will have a new president. We are bearish on the US dollar in the short term and bullish on the US dollar in the medium term. Same with gold and silver.

It will be a volatile week in the making. The US dollar will be the key to every move in commodity markets. Whether the US dollar will fall at the pace we had seen in the first quarter, I have my doubts. But certainly I am bearish in the US dollar this week as well in the short term. Medium term bullishness for the US dollar remains intact.

TODAY

We prefer to remain on the sidelines and buy on sharp dips as well as sell on rise.

COMEX GOLD DECEMBER

Gold has to break 100 day MA of $892 for $927-$950 zone. On the lower side sellers will emerge only on a consolidated fall below $848 and $830.

Disclaimer: Any opinions as to the commentary, market information, and future direction of prices of specific currencies, metals and commodities 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.Prepared By Chintan Karnani. Website www.insigniaconsultants.in

-- Posted Monday, 22 September 2008 | Digg This Article | Source: GoldSeek.com

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