-- Posted Wednesday, 9 February 2011 | | Source: GoldSeek.com
GENERAL MARKET CONDITIONS/FUNDAMENTAL FACTOR
I have been reading the net and a lot of analysts have written off gold and silver. I have received calls from traders on gold and silver’s crash. I have been a silver bull all my life and will remain a silver bull for the next five years. Corrections are a part and parcel of a long term bull rally. In the last decade gold prices have risen from $300 to $1434 while silver prices have risen from $7.0 to over $31.0 an ounce. Corrections of twenty percent are a part of a long term bull rally and should be used as an investment opportunity. I will be concerned over the long term bullishness of gold and silver if prices remain below $1000 and $17.00 for three continuous months. This is a highly unlikely scenario at the moment. Over the next five years gold prices could rise to $2200 and silver could rise to $60.00.
There are lots traders who tell me that interest rate hikes will result in gold and silver crashing like a pack of cards. This has not yet happened. The gold price is at $1363 while the silver price is at 30.08. These are near all time highs. Where is the fall in gold and silver? When gold prices fell to $1320 a lot of jewelers in India told me that gold prices have fallen significantly. Probably they want gold prices to rise needlessly. Gold prices did not even remain below $1320 for a fortnight. The federal reserve and the European central bank are not expected to raise interest rates this year. Only the bank of England will raise interest rates this year. Interest rate hikes will only reduce the pace of the rise of gold and silver and not the rise. Sharp corrections should be used as an investment opportunity. I am not writing off gold and silver. But for long term investment I will prefer to wait for some time and then invest.
A lot of traders have lost a fortune doing short trades in gold and silver. My experience is that it is better to get stuck on the long side than on the short side. If you are long you can take physical delivery also. Just remember that gold and silver prices will never be zero. Those who were stuck in silver longs at $30 in December their prices have come. Those who are stuck in silver shorts at $27 they are scared. Short traders at $27 will also make profit but they will need to average out.
TODAY
The Federal Reserve bond auction will continue tomorrow which should prevent commodities from a major crash. Past experience is that whenever China raised interest rates all commodities have risen sharply and went to new all time highs. Yesterday was no such exception. Today is a very crucial day for gold and silver. If they fall in the US session then one can expect a short term top to be formed. Technically all commodities are bullish.
GOLD APRIL 2011 TECHNICAL LEVELS |
SUPPORT | RESISTANCE |
S1 | S2 | S3 | S4 | R1 | R2 | R3 | R4 |
$1,342.10 | $1,346.60 | $1,357.90 | $1,363.40 | $1,372.30 | $1,376.20 | $1,381.10 | $1,384.60 |
SILVER MARCH 2010 TECHNICAL LEVELS |
SUPPORT | RESISTANCE |
S1 | S2 | S3 | S4 | R1 | R2 | R3 | R4 |
$2,840.00 | $2,947.00 | $2,973.00 | $2,993.00 | $3,019.00 | $3,041.00 | $3,054.00 | $3,124.00 |
COPPER MARCH 2011 TECHNICAL LEVELS |
` | RESISTANCE |
S1 | S2 | S3 | S4 | R1 | R2 | R3 | R4 |
$437.00 | $441.00 | $447.40 | $451.20 | $457.80 | $464.50 | $471.80 | $475.00 |
CRUDE OIL (1st Contract) |
SUPPORT | RESISTANCE |
S1 | S2 | S3 | S4 | R1 | R2 | R3 | R4 |
$84.80 | $85.30 | $86.50 | $87.05 | $88.20 | $88.60 | $89.10 | $90.50 |
COMEX TECHNICAL VIEW
COMEX GOLD APRIL
Bullish over $1358 with $1372 and $1383 as price target
Bearish below $1351 with $1342 and $1331 as price target
Neutral Zone between $1351-$1358
Gold has reached our target of $1358 and now needs to trade over $1358 for $1372 and $1383. There will be sellers below $1358 only.
COMEX SILVER MARCH
Bullish over $2993 with $3054 and $3154 as price target
Bearish below $2973 with $2937 and $2817 as price target
Neutral Zone between: $2973-$2993
A break of $3053 will result in $3150 and $3200. There will be sellers below $2973 to $2934 and $2900.
However failure to break $3054 will result in a fall to $2900 and below
COMEX COPPER MARCH
Bullish over $454 with $461 and $469 as price target
Bearish below $451 with $446 and $441 as price target
Neutral Zone between: $451-$454
Copper needs to break and trade over $461 for $469 and $484. There will be sellers below $461.
NYMEX CRUDE OIL (1ST CONTRACT)
Bullish over $88.90 with $90.50 and $92.20 as price target
Bearish below $87.50 with $86.30 and $84.10 as price target.
100 day moving average at $85.45 is the key support and crude oil needs to trade over $85.45 to be in bullish zone.
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
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-- Posted Wednesday, 9 February 2011 | Digg This Article
| Source: GoldSeek.com
