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-- Posted Thursday, 27 February 2003 | Digg This Article
METALS:2/27 OVERNIGHT CHANGE to 4:15 AM:GLD+1.10 ,SLV-0.5 ,PLAT+3.60, CP -15 London Gold Fix $354.00 +$1.45 LME Copper Warehouse stks 822,675 ton -500 tns Comex Gold stocks 2.263 ml Unchanged COMEX Silver stks 108.1 ml oz +28,255 oz OVERNIGHT ACTION: Another session where early gains were posted but then pared late. GOLD: The gold continued to consolidate despite what appeared to be a very aggressive war rally in the energy markets on Wednesday. This morning the energy sector is rising again and that has pushed gold up slightly in the European action. The UK Prime Minister managed to overcome political opposition to provide another formal warning to Iraq and that would seem to reconfirm the UK commitment. Commitment in the UK and elsewhere could be a contentious thing over the coming weeks but we hardly see the opposition to war gaining a foothold unless Iraq shows clear cut cooperation, or France and Germany try to physically block the US through the placement of Security forces inside Iraq. In the end we are a little concerned with the lack of momentum in the gold in the action Wednesday as that suggests the market is overbought again (unlikely because the April gold is only $13 above the February low). Considering that the gold was 87,000 contracts long in the fund and small spec category, in the last COT report and the market is sitting at the same level as it was when the report was measured, the market is probably only 90,000 spec long coming into the action today. We still think that $350 will be critical support basis the April and that $360 is thin resistance in the near term. We still think the bias is up but we are not sure the gold will respond sharply without some fresh political development. In fact, if there is anything from the political front it might be bearish as Saddam might want to show some compliance to discourage the US from acting this week. Late in the session if Iraq has made no effort to ingratiate Hans Blix, we suspect that the bulls will lift the market under the theme that the US might attack. SILVER: The silver market appeared to make a slight upside breakout (on a very short term basis) overnight but once again the market will need strong leadership from gold to make significant gains. The economic report slate today could be slightly supportive for silver as durable goods and the housing figures are expected to show a slight gain. We doubt that the numbers will be able to turn the stock market up, which is what silver needs to rally without a move in gold. We would not want to see silver fall below the critical pivot point today of $4.625 basis the May contract but one might consider the market breaking out to the upside in the event the $4.70 level is regained. METALS TECHNICAL OUTLOOK 2/27/03 #P-METALS 02/27/03: 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 464.4 and below there at 461.2 with resistance likely at 466.7 and 469.4. The market's close above the 9-day moving average suggests the short-term trend remains positive. Positive momentum studies in the neutral zone will tend to reinforce higher price action. The next upside target is 466.7. GOLD (APR): Support for gold today comes in near 349.30, while resistance is pegged at 358.90. Daily momentum studies are on the rise from low levels and should accelerate a move higher on a push through the 1st swing resistance. The near-term upside objective is at 358.90. It is a mildly bullish indicator that the market closed over the pivot swing number. The market's short-term trend is positive on a close above the 9-day moving average.
-- Posted Thursday, 27 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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