-- Posted Tuesday, 9 October 2012 | | Disqus
General market conditions
IMF cuts global growth forecast
The IMF cut its global growth forecast for the second time since April and warned U.S. and European policymakers that failure to fix their economic ills would prolong the slump. For 2012, the IMF now expects global output to grow just 3.3 percent, down from its July estimate of 3.5 percent, making it the slowest year of growth since 2009. It predicted only a modest pickup next year to 3.6 percent, below its July estimate of 3.9 percent.
Our View: The lower global growth forecast has been priced in by the financial markets. The only way for global equity markets and commodity markets are northwards over the coming weeks and months. A fall will be there if (A) There is a big slump in global growth. (B) New conditions emerge which could suggest it could take a longer time than expected to emerge out of the current economic mess. Europe and China will be the key more than any other nation for the world till March 2012. The overall trend in gold and silver is higher however slower global growth will reduce the pace of rise. Gold and silver investors need to have a higher degree of patience on the short term investment and medium term investment. I believe that crude oil could start another big rally in the next one year and should break past $160 (Nymex crude) anytime in 2014. Crude oil is trading in a wider $60-$120 wider range over the past three years. This long term range will be broken soon. We also prefer buying far dated natural gas call options between March 2013 and September 2013 as premiums are very cheap.
Protectionism on the rise in the name of national security
Cisco Systems Inc., the largest maker of networking equipment, ended a partnership with ZTE Corp. amid concerns over the Chinese company’s alleged sale of equipment to an Iranian company. The U.S. House of Representatives' Intelligence Committee warned the industry that Beijing could use equipment made by ZTE and Huawei to spy on certain communications and threaten vital systems through computerized links. The panel urged network providers and others to seek other vendors for their projects.
Our View: The USA can stop any company from operating in its nation in the name of national security. The real motive is to protect its globally uncompetitive companies. These companies are provided all kinds of sops to operate. The real reason is just protectionism and nothing else. If India, China or any other nation resorts to measures which USA uses for its corporations and startups then the USA will refer the same to the world trade organization (WTO). As it is visa norms for temporary workers working in Indian technology companies has been reduced by USA and UK. Visa charges have also been increased. Asian nations and other non Europe and non USA nations will take retaliatory measures. The end result continued demand for safe havens like gold and silver and reduced demand for currency based investment.
COMEX TECHNICAL VIEW
COMEX GOLD DECEMBER 2012 – current price $1780.60
Bullish over $1768 with $1810 and $1848 price target
Bearish below $1758.40 with $1747 and $1721.00 as price target
Neutral Zone between $1758.40-$1768.00
Break point: $1781.30
- Gold can rise to $1810 as long as it trades over $1760. There will technical break down below $1760 to $1741 and $1718
A bit on the Indian rupee (inter bank rates only).
Technically the Indian rupee has formed a short term bottom against the US dollar. Yesterday’s reversal was just short covering buoyed by US dollar demand by importers. There is more positive news at the moment than negative. Indian exporters and others are waiting for a rise today to sell forward. The next three days are very crucial for the rupee (usd/inr). If the rupee continues to weaken against the US dollar in the next three days then sellers will vanish and buyers will emerge. Technically the rupee (usd/inr) can rise to 53.0450-53.4700 in the short term and then fall to 52.1500-52.4750. Rupee prices will be the key for Indian commodity prices. Indian importers are heaving a sign of relief before the festive season due to the rupee appreciation.
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
Disclosure: Insignia consultants or it employees do not have any trading positions on the trading strategies mentioned above. Our clients do have positions on the trading strategies mentioned in the above report.
Trade without emotions
"Print this report only if absolutely necessary. Save Paper. Save Trees."
NOTES TO THE ABOVE REPORT
PLEASE NOTE: HOLDS MEANS HOLDS ON DAILY CLOSING BASIS
PLEASE USE APPROPRIATE STOP LOSSES ON INTRA DAY TRADES TO LIMIT LOSSES.
APPROPRIATE STOP LOSSES PER LOT IN US DOLLARS ON THE TRADING CALLS GIVEN IN THIS REPORT
COMEX GOLD – $15-$17
COMEX SILVER: $25-$30
COMEX COPPER: $3
NYMEX CRUDE OIL: $0.60
SPOT SILVER: $0.25
SPOT GOLD: $15-$17
THE TIME GIVEN IN THE REPORT IS THE TIME OF COMPLETION OF REPORT
Customer care: 9311139549
You can also mail your queries at insigniacommodity@gmail.com
Chat Id: mcxsuretips@gmail.com (gtalk), insigniaconsultants@yahoo.com (yahoo)
(10:30 am to 5:30 pm Indian time, Monday to Friday)
-- Posted Tuesday, 9 October 2012 | Digg This Article
| Source: GoldSeek.com
