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-- Posted Wednesday, 12 February 2003 | Digg This Article
METALS:2/12 OVERNIGHT CHANGE to 4:15 AM:GLD+0.90 ,SLV+1.5 ,PLAT+11.00 London Gold Fix $363.15 +$1.00 LME Copper Warehouse sts 834,975 ton -3,400 tns Comex Gold stocks 2.156 ml -64 oz COMEX Silver stks 107.5 ml oz -5,961 oz OVERNIGHT ACTION: Sporadic selling interest seen in Japan despite Dollar weakness. GOLD: This market continues to hover near critical downside breakout points on the charts and it would seem that the chance of war hasn't improved but a concern for widespread deflation might be ready to surface. We fear deflation because of the recent terrorist warnings. Certainly the threat of war isn't downgraded completely, but it continues to suffer from a lack of imminent war expectations. It is possible that $360 in the April contract will be respected as support, but we are a little concerned about the slight "lower low" for the move in the overnight action. Forced to make a call, we suspect that the next $3-$4 move in gold is probably down. While we doubt that April will fall to $350 it should not be ruled out, considering the overbought condition and the diplomatic knot seen in the Iraqi situation. With the Nikkei was higher overnight and Greenspan dialogue again today we suspect that deflationary concerns will be downplayed temporarily. The Press headlines suggest that the Dollar is down today, because a war with Iraq is near, but gold is simply not responding to that same sentiment. Longs should still be long but holding put coverage until daily gold action improves, or until the April contract trades $350. SILVER: While silver might have bounced off the recent low, it remains in a vulnerable position. In fact, we see no reason for silver to halt the correction until the 450 or 445 level is tested in the May contract. While there has been some open interest liquidation in silver, it still remains high enough at 96,903 contracts to present more liquidation pressure on silver. Since the US Fed Chairman didn't trumpet a strong growing US recovery and war isn't expected to start in the near term, the bears retain a slight edge in silver. About the most positive development in silver this week is that the 40-cent correction has probably begun to balance the excessively overbought condition. METALS TECHNICAL OUTLOOK 2/12/03 #P-METALS 2/12/03: SILVER (MAY): The market tilt is slightly negative with the close under the pivot. Initial support for silver is at 455.7 and below there at 452.9 with resistance likely at 458.4 and 460.7. A negative signal for trend short-term was given on a close under the 9-bar moving average. Daily stochastics declining into oversold territory suggest the selling may be drying up soon. The next downside objective is 452.9. The market is approaching over sold levels on an RSI reading under 30. GOLD (APR): Support for gold today comes in near 358.10, while resistance is pegged at 368.50. Stochastics trending lower at midrange will tend to reinforce a move lower especially if support levels are taken out. The next downside target is now at 358.10. It is a slightly negative indicator that the close was under the swing pivot. The close below the 9-day moving average is a negative short-term indicator for trend.
-- Posted Wednesday, 12 February 2003 | Digg This Article
***This report includes information from sources believed to be reliable and accurate as of the date of this publication, but no independent verification has been made and we do not guarantee its accuracy or completeness. Opinions expressed are subject to change without notice. This report should not be construed as a request to engage in any transaction involving the purchase or sale of a futures contract and/or commodity option thereon. The risk of loss in trading futures contracts or commodity options can be substantial, and investors should carefully consider the inherent risks of such an investment in light of their financial condition. Any reproduction or retransmission of this report without the express written consent of Hartfield Management, Inc. is strictly prohibited.
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