-- Published: Monday, 16 June 2014 | Print | Disqus
Global economic calculations could change due to the crisis in Iraq and the subsequent impact on crude oil prices. Iraq tensions will force the Federal Reserve to be hawkish on interest rates this week. They will not be very clear on the interest rate cycle for the rest of the year. There are huge short positions in gold and silver. If there is sustained short covering, then gold and silver could easily rise to $1335/$1400 (gold) and $20.40/$22.35 (silver). This week is very crucial for gold and silver. They have to rise and shine this week, or else RIP in the short term. I am bullish.
The months of June to September are very crucial for global economic growth. Emerging markets like India and China are trying to recover from last year’s woes. The USA has to continue its firm growth. A slowdown in global economic growth in the coming three and half months will be very bullish for gold and silver as talks over interest rate hikes in the USA and interest rate cuts in India and emerging markets will vanish.
It could be all about energy due to Iraq for everyone
Sustained higher energy prices will dent US economic growth and global growth. This is something which US president Barack Obama knows and European leaders know very well. They need to find a way of preventing energy prices from spiraling. Crude oil prices are controlled by America. US senate elections will be in November. What has happened in Iraq is created by the USA and only the USA will shape the future of the Middle East and the North African region.
Higher energy prices will be obviously bullish for gold and silver. The American summer holiday season will start next month. Higher energy prices can affect the travel plans by Americans next month. The Asian summer travel will end by the middle of next month. Travel industry gets hampered. There are a whole lot of multiplier effects due to higher energy prices.
TODAY
A break of $1292 for gold will trigger another wave of rise to $1303 and $1315. Silver needs to break and trade over $20.14 for another wave of rise. Crude oil has to break and trade over $109 for another wave of rise.
TECHNICAL VIEW
MCX SILVER JULY – prices in Indian Rupees below
Key long term support is at 41259 and as silver needs to trade over 41259 this week to target 42835 and 43588. Initial resistance is at 42328. Today silver needs to break and trade over 42328 for another set of rise. Remain on the sidelines despite the bullish direction.
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.
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NOTES TO THE ABOVE REPORT
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UK session starts around 1:30 pm Indian Standard Time (+5:30 GMT) -- after the release of LME daily inventories
US session starts at 6pm pm Indian Standard Time (+5:30 GMT)
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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-- Published: Monday, 16 June 2014 | E-Mail | Print | Source: GoldSeek.com
