-- Posted Tuesday, 14 July 2009 | Digg This Article
| | Source: GoldSeek.com
DAILY COMEX REPORT
There are a lot of things that happened last week which could affect the financial markets/global economic scenario in medium term to long term.
1) Developed nations acknowledging that global growth/power is shifting to emerging nations such as India, china, Russia etc.
2) US government proposal to regulate energies trade and also over the counter derivatives trade.
3) Investor uncertainty on global economic growth continues.
4) Chinese official foreign exchange reserves rising to nearly $2 trillion.
There is another new scenario which I am looking at over the coming years which is (A) There should be a substantial rise in the US savings rate over the coming years (B) Savings rate in China, India and other emerging nations should fall and retail consumption should see a sharp rise in these nations. This will alter the world economic growth as well as the position of the US dollar. Global growth rates in future will be dependent on emerging nations which in turn will have a multiplier effect on foreign exchange markets as well as the balance of power. The US and its second world war allies may not be as powerful as they used to be. The net result will be (A) short term gains in the US dollar (B) Gold could be the currency among central bankers as a result of the US dollar decline story and lack of an alternate currency to the US dollar. (C) Commodities price movement and currency market movement in Asia will dictate the rest of the world. At the moment there is lack of liquidity in Asia in these markets. In my view Asian liquidity will rise over the coming years. Foreign financial institutions as well as local financial institutions will be allowed to participate in commodities futures and commodities derivative trade in India, China and other Asian countries (excluding Japan). These will not happen in the immediate future but the trend towards has started and the common man will be witnessing the same over the coming years.
Short-term investors are trying to guess the pace of global growth rates. The second quarter performance of commodities may not be repeated in the third quarter. Both positive news as well as negative news will affect the markets (unlike in a secular bull market all negative news were ignored and positive news accepted). Volatility will be high.
TECHNICAL VIEW
COMEX GOLD AUGUST
Gold targets $927 and $937 as long as $913 holds. Intra day there will be there sellers on a consolidated fall below $913.
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 Tuesday, 14 July 2009 | Digg This Article | Source: GoldSeek.com
