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-- Posted Tuesday, 19 July 2005 | Digg This Article
METALS: OVERNIGHT CHANGES THROUGH 4:00 AM: GOLD +1.90, SILVER +5.50
London Gold Fix $420.00 -$1.60 LME COPPER STOCKS 26,975 metric tons -25 tons COMEX Gold stocks 5.736 ml oz Unchanged COMEX SILVER stocks 106.1 +600,400 oz OVERNIGHT ACTION: Minimal short covering/follow through buying was seen in Asia off Monday US gains. GOLD: The market was surprised a little by the strength in the gold market yesterday, but the strength in gold seemed to flow from other metals markets like copper. Talk that India might change some import regulations failed to stimulate buying interest overnight, possibly because the market was disappointed in projections of softer Asian jewelry demand. While the gold market has certainly showed the capacity to shake off the selling pattern in place last week, we doubt that market has shaken the overall bearish trend in place since late June. In fact, in a big picture sense the gold market has respected a pattern of lower highs and lower lows and could easily fall back to the May low of $415.8 without notice. By our estimates the gold market currently holds a spec and fund long of 100,000 contracts and that could easily fuel a slide back to the lows. However, in order to facilitate a slide and force the specs from position, it could take a significant rise in the US Dollar or staunch support of the US recovery from the Chairman of the Federal Reserve on Wednesday. A private brokerage firm forecast overnight calls for a slide to $416 in spot gold and that would seem to highlight the mostly bearish tilt in the marketplace. Critical pivot point support comes in at $420.2 and then again at $418.2. SILVER: A series of lower highs and respect for a pattern of higher lows has left the silver market coiling and possibly poised for a breakout. However, we are having a difficult time rationalizing an upside breakout off the fundamentals as there has been almost no change in the visible fundamentals for months. Like the gold market, silver remains vulnerable to long liquidation, especially when one looks back to the last COT report reading. Furthermore, instead of seeing silver stocks decline at the exchange, in the face of the economic recovery of the last two years, silver stocks have simply consolidated above the critical 100 million ounce level. September silver looks to have a breakout range of $7.055 and $6.965, but a slide below the July lows might be in the cards in the coming sessions unless the funds return with notable buying interest. METALS TECHNICAL OUTLOOK 7/19/2005 SILVER (SEP) 07/19/2005: Positive momentum studies in the neutral zone will tend to reinforce higher price action. The close below the 18-day moving average is an indication the longer-term trend has turned down. It is a mildly bullish indicator that the market closed over the pivot swing number. The next upside target is 708.3. The next area of resistance is around 704.0 and 708.3, while 1st support hits today at 697.1 and below there at 694.3. GOLD (AUG) 07/19/2005: Daily stochastics are trending lower but have declined into oversold territory. The market back below the 18-day moving average suggests the longer-term trend could be turning down. The daily closing price reversal down puts the market on the defensive. With the close higher than the pivot swing number, the market is in a slightly bullish posture. The next downside target is 418.9. The next area of resistance is around 422.2 and 423.7, while 1st support hits today at 419.8 and below there at 418.9.
To those of you who have emailed or commented on the daily commentary regarding price manipulation: our daily comments are strictly to provide our customers and subscribers with news, which may influence the markets marginally on a day-to-day basis. This is not the forum to address price manipulation.
There are multitudes of ways in which one can participate in a bullish or bearish perspective in the metals complex. Mining shares as well as purchasing bullion are just a few. Another investment of choice is through futures and/ or options on futures contracts. If you have traded, then you will be able to appreciate the brokerage service that Nell Sloane and Group can offer. If you have not, and wish to learn more about it, please feel free to contact her staff so that they can forward you some educational literature for your review. Please contact Nell Sloane or a member of her team at 800 238 2610.
-- Posted Tuesday, 19 July 2005 | 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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