-- Posted Monday, 2 December 2013 | | Disqus
The opening of the month moves in the Asian session suggests caution among gold and silver investors. Trading volumes will rise as the week progresses. Intraday volatility will reduce and gold and silver will soon form a short term direction as the week progresses. US November nonfarm payrolls will be the key apart from GDP numbers and new home sales numbers. Chinese November factory growth rising to an eighteen month high should be bullish for base metals and energies. It all depends on whether spot gold is able to fall below $1225 and spot silver is able to fall below $19.35 for bears to have the edge. I still maintain gold is a good long term investment (two years to three years). However one needs to use caution investing at current prices. I do not think that the Federal Reserve will be in a hurry to raise interest rates very quickly as there are risks to the same. If the Federal Reserve directly says they are not in a hurry to raise interest rates then gold and silver bears need to worry.
Historically the Bank of England has been a trendsetter (among developed nations central banks) on interest rates. A stable UK economy will imply that the UK will move out of the zero interest rate spiral earlier than most of its developed nation counterparts. I am watching Europe (including the UK and Eastern Europe and ex USSR nations) very closely due to the fragile economy and unstable political climate in some nations. Most of the positive performance of the US economy has already been factored in by the markets.
Traders are on the edge as far as Europe is concerned. Early November traders were converting long euro/usd positions into short euro/usd positions. Now it seems they are once again moving into long euro/usd positions. It has been quite a see saw for euro/usd. Gold and commodities are affected by short term wild swings in the euro.
“Abenomics” seems to working wonders for Japan as inflation is there. Japanese construction orders are on the rise and Japan housing starts are also on the rise. Japanese economic growth in 2014 will be very crucial for gold and commodities general. Any hints of Japan moving away from the long term deflation spiral will result in the rise of Japanese government bond (JGBs) yields and the continuation of a bearish trend for gold and silver.
In short, in 2014, global bond yields will be the key to gold and silver prices. There will be an inverse correlation between bond yields and gold and silver prices. Global bond yields will only rise if the global economy shows signs of sustained growth. Global economic fundamentals expectation for 2014, will trigger the next big move for gold, silver and commodities in general.
TODAY
COMEX TECHNICAL VIEW
COMEX GOLD FEBRUARY 2014 – current price $1246.10
Bullish over $1242.00 with $1261.40 and $1286.00 price target
Bearish below $1234.00 with $1222.40 and $1206.80 as price target
Neutral Zone between $1234.00-$1242
Break point: $1242.00-$1259.80
- There is a technical congestion between $1234-$1280 zone and as long as gold trades over this zone it still can rise to $1259-$1284
- There will be sellers only below $1234 with $1225 and $1209 as the key intraday supports
MCX SILVER MARCH 2014 – prices in Indian rupees below
- Today silver needs to trade over 45720 to 46566-47158. Initial support is at 45403 and there will be sellers only below 45403.
- Bearish trend will be there only a daily close below 44570 for four consecutive days will result in 41259 and 37826.
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 Manan Somani
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.
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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
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-- Posted Monday, 2 December 2013 | Digg This Article
| Source: GoldSeek.com
