-- Posted Friday, 13 February 2009 | Digg This Article | Source: GoldSeek.com

GENERAL MARKET CONDITIONS/FUNDAMENTAL FACTOR

There are apprehensions over the pace of recovery of global growth which has resulted in more and more investing in gold and other safe havens. The delinking from the US dollar of precious metals is clearly an example of investor’s apprehension to invest in equities and other traditional forms of investment. Investors who had invested in equities in the first half of 2008 are now apprehensive whether they will get back their capital in the next twelve to eighteen months.  In my view the bottom in equities will form in the next three to four months. But the pace of the rise will be like that of a snail in 2009. Investor investment in gold and other safe havens is primarily due to lack of secure alternate investments. This will continue in the first half of 2009. After the first half of 2009 investors will reassess global economic conditions and shuffle their portfolios accordingly.

The investor search for the bottom in crude oil continues. There are a large number of investors in India who have invested in crude oil for the long term. However crude oil prices are not rising and the roll over cost is very high under current circumstances. As a result some of the investors have been forced to square off their longs. My advice to them is for far dated futures and try to average out. With every fall crude oil investment looks attractive but crude oil can still fall to $28 and below if the global economy does not recover in the medium term. Long term investors should buy far dated calls in crude oil. The pace of the rise in crude oil will fall. In my view when there is clear certainty that crude oil prices will rise then gold prices will fall as investors will be switching from gold to crude oil.  

TECHNICAL VIEW

COMEX COPPER MARCH

Back to square one for copper as it needs to hold $155 to prevent a fall to $149 and $143 once again. On the higher side a break of $155 will result in $159 and $165.

THIS IS JUST AN EXCERPT OF THE MAIN REPORT FOR SUBSCRIPTION CALL 011-23210678

DISCLOSURE: NO POSITIONS

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 Friday, 13 February 2009 | Digg This Article | Source: GoldSeek.com

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