-- Posted Monday, 27 July 2009 | Digg This Article
| | Source: GoldSeek.com
GENERAL MARKET CONDITIONS
It has been a very positive last week for all commodities as they rose in every day of the week. The reasons can be summed as under:
1) Global economy (particularly G7 nations) looks a lot more positive than June. Investors expect this trend to continue in August too.
2) Stock rose on positive sentiments.
3) Investment flows into commodities to rise as a result of the above factors.
4) Commodities were slightly delinked from the US dollar. However overall they still continued to be dictated by the US dollar on intra day basis.
5) Technical factors also contributed to the rise.
However fundamentals have not yet changed and overall demand for commodities remain subdued. Commodities will fall as and when fundamentals override technical and investment factors. Whether commodities have once again started the long term super cycle bull run, its too early to comment. All I can say is that 2009 lows in base metals and energies will not be seen in the next 3-4 years. If at all there may be a 20%-25% fall in commodity prices then it could be a great long term investment. But I do not expect such a fall.
This week there are a lack of major market moving economic news. It will be a technical trade. The big question for the next fortnight is whether crude oil will be able to sustain the rise and edge past $80. If crude oil does not break $80 in the next two week then I expect a pullback to $59.
Trade in the technicals this week is my message to the readers and do not get carried by the momentum.
TECHNICAL VIEW
COMEX GOLD AUGUST
Technically gold targets $974 and $990 in short term as long as $936 holds.
Intra day gold needs to break $959 for $971 and $986. On the lower side as long as $943-$947 zone downside risk will be limited.
COMEX SILVER SEPTEMBER
There is a technical congestion between $1396-$1415 and silver needs a consolidated break of the same to target $1505 and $1586 in short term.
Intra day silver needs to hold $1376 to target $1415.
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 Monday, 27 July 2009 | Digg This Article | Source: GoldSeek.com
