-- Posted Tuesday, 27 January 2009 | Digg This Article
| Source: GoldSeek.com
WEEKLY TECHNICAL REPORT FOR WEEK BEGINNING 26TH JANUARY, 2009.
IS THE GOLD RALLY A MERE BUBBLE?
I was reading the internet there was apprehensions over the current rise in gold prices. Some of the comments were that the current gold price rise is nothing but just a bubble. I do not agree to this view. In my view the current rise in gold prices is here to stay in the long term but in the short term and medium term there will be wild fluctuations.
The decline of the US dollar standard and other paper currencies is my first reason. Over the past fifty years central banks have littered the world with an unlimited amount of paper currency. The purchasing power of paper currencies is on the decline with the passing of each day. The US dollar is the medium of exchange in global trade. The share of US dollars in global trade is falling with the passing of each year. Since gold and other commodities are quoted against the US dollar, the value of gold and other commodities are bound to rise as the purchasing power of the US dollar declines. Gold is money of the future.
For centuries and centuries the west have always ignored the importance of gold as an investment while the east such as India, China and rest of Asia have always invested in gold. The bulk of global physical gold demand came from the East. Now the western world has also started investing gold. If the west starts to invest in gold then gold prices are bound to zoom.
I can write endless pages on the need to invest in gold. The rise in gold prices is here to stay. Gold prices will only fall when there is a secure alternate investment available. In the long term gold may not give very high returns as compared to equities. But investment in gold at lower prices is virtually risk free.
COMEX FUTURES
COMEX COPPER MARCH
COMEX COPPER MARCH 2009 |
SUPPORT | RESISTANCE |
S1 | S2 | S3 | S4 | R1 | R2 | R3 | R4 |
$127.80 | $131.60 | $139.0 | $143.0 | $157.60 | $166.10 | $172.80 | $186.10 |
o Neutral zone
o Copper needs to close over $157 for three consecutive days to target $176 and $202.
o Key support is at $127 and $120
o Trading strategy: Buy on dips as long as $127 holds OR buy over $143.
This is just an excerpt of the main report for subscription call 011-23210678/9311139549
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 Tuesday, 27 January 2009 | Digg This Article | Source: GoldSeek.com
