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-- Posted Tuesday, 18 February 2003 | Digg This Article
METALS:2/18 OVERNIGHT CHANGE to 4:15 AM :GLD-4.30 ,SLV-1.7,PLAT-.40,CP +15 London Gold Fix $347.00 -$9.25 LME Copper Warehouse sts 826,775 ton -2,625 tns Comex Gold stocks 2.164 ml Unchanged COMEX Silver stks 107.6 ml oz -10,063 oz OVERNIGHT ACTION: Minor weakness seen in Tokyo but focus is on more UN diplomacy. GOLD: With the gold market starting the week about $16 below the recent COT report benchmark of $363, we have to think that the net spec long is closer to 96,000 contracts long, instead of the 106,000 registered in the report. The fact that the UN speech last Friday left the world unsure that war would be likely in the near term was augmented slightly by a compromise EU agreement yesterday that in effect gives Saddam another "last chance". According to the EU deal, the weapons inspectors would be given at least another couple weeks to uncover information, making it possible that "no war" will be seen until after March 1st. Even with the net spec long pared down significantly, we have to think that another delay in the war timing, will force even more weak longs to the sidelines. Gap lower action overnight in the gold, hints at the beginning of a further liquidation tilt that could project a decline in the April contract to $342.5. There would not appear to be a significant trend in the Dollar but the delay in the war timing has in many ways removed the persistent downside pressure in the Dollar and that in turn takes away some buying interest from gold. If the world economy begins to show signs of significant deflationary pressure, as a result of the war stalemate that could exaggerate the liquidation in the gold. SILVER: With gold weakness this morning we have to fear that May silver is poised to fall below critical support of $4.50. Fortunately open interest has declined and the recent COT report showed a 16,000-contract decline in the net spec long positioning and that reduces the technical vulnerability in silver. However we suspect that silver still maintains a net spec long position of at least 56,000 contracts. With silver prices within 17 cents of the deflated pricing of last October, we doubt that silver will encounter significant liquidation pressures. However, if the $4.50 level fails to hold, that could set up a retest of the November low support of $4.44. METALS TECHNICAL OUTLOOK 2/18/03 #P-METALS 02/18/03: SILVER (MAY): With the close higher than the pivot swing number, the market is in a slightly bullish posture. Initial support for silver is at 452.0 and below there at 449.0 with resistance likely at 454.5 and 457.0. The market's close below the 9-day moving average is an indication the short-term trend remains negative. Momentum studies are declining, but have fallen to oversold levels. The next downside target is 449.0. The 9-day RSI under 30 indicates the market is approaching oversold levels. GOLD (APR): Support for gold today comes in near 344.08, while resistance is pegged at 361.48. Daily stochastics are trending lower, but have declined into oversold territory. The next downside objective is now at 344.08. Daily studies pointing down suggests selling minor rallies. The market's close below the 1st swing support number suggests a moderately negative setup for today. The downside crossover (9 below 18) of the moving averages suggests a developing short-term downtrend.
-- Posted Tuesday, 18 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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