-- Posted Tuesday, 15 March 2011 | | Source: GoldSeek.com
TODAY IS THE IDES OF MARCH
GENERAL MARKET CONDITIONS/FUNDAMENTAL FACTOR
Japan Earthquake and effect on base metals
Base metals have reacted to Japanese quake news by falling. The key reason is that demand will be less from the quake region as companies shut plants. Lots of base metals scrap will come out in the market once the region is cleared. This will initially result in higher supplies. BUT the reconstruction will require lot and lots of copper, zinc, steel, nickel and other base metals. Probably much more than we expect. This should push up base metals demand in a big way over the coming months and years. Just remember that a destroyed building is not built in one day. I expect base metals demand to zoom as a result of the Japanese quake. Concerns of higher crude oil prices reducing base metals demand will be more than offset by Japanese reconstruction demand in the earthquake hit regions.
TODAY
Saudi Arabia sent troops into Bahrain on Monday to help calm weeks of protests by the Shi'ite Muslim majority, a move opponents of the Sunni ruling family on the island called a declaration of war. Muammar Gaddafi's jets bombed Libyan rebels on Monday in a counter-offensive that has pushed them back 100 miles (160 km) in a week, far outpacing diplomatic efforts to impose a no-fly zone to help the rebels.
To sum it up there is a further escalation in the middle east and north Africa region. Traders will either go long or square their long positions in gold, silver and crude oil but leaving a short position for the next day could be a dangerous proposition.
COMEX TECHNICAL VIEW
COMEX GOLD APRIL
Bullish over $1423 with $1437 and $1452 as price target
Bearish below $1417 with $1406 and $1387 as price target
Neutral Zone between $1419-$1423
- Gold needs to trade over $1417 for the whole day to target $1443+. There will be sellers only if gold trades below $1417.
- Keep a close watch at $1417 and $1437 as a break of either of these prices will result in big moves.
- Trading call: Buy around $1411 stop loss below $1403 OR Buy over $1431 for $1434 and $1441
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 Tuesday, 15 March 2011 | Digg This Article
| Source: GoldSeek.com
