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-- Posted Tuesday, 6 December 2005 | Digg This Article
METALS: OVERNIGHT CHANGES THROUGH 4:00 AM: GOLD +0.10, SILVER -1.00
London Gold Fix $510.00 +5.00 LME COPPER STOCKS 75,125 -150 metric tns
COMEX Gold stks 6.666 ml oz Unchanged COMEX SILVER stks 117.6 ml oz Unchanged OVERNIGHT ACTION: Early overnight buying seemed to be off US catch-up action and those gains gave way to a lackluster late trade in some Asian markets. GOLD: While gold prices in Singapore managed to reach the highest level since 1980, it is still pretty clear that most international markets are following the US action instead of leading it. However, fund buying was still present in the overnight action and the Press continued to play up the inflation theme. Therefore, the gold market continues to get buying interest from a diversified collection of fundamentals and that should minimize corrective action. Furthermore, we have to think that recent strength in gold and a slight acceleration in the pace of the global economy will keep many central banks in a mode to increase their gold reserves. With oil prices potentially rekindling inflationary interest, we suspect that gold will remain well bid in the coming sessions. In fact, until the proximity of the FOMC meeting next week, the gold market will probably avoid the dampening affects of the US rate hike posture. Near term critical support in the February gold comes in at $510 but the market might be temporarily limited by news that a European Mining company had completed a hedging program of 440,000 ounces at $574, as gold hedgers can sometimes behave like a herd! On the other hand, it would certainly seem like physical and jewelry demand is running hot enough to absorb a certain amount of hedging. Near term upside targeting in February gold is now $515. SILVER: Underpinned by the weekly highs at $8.60, the March silver looks to have some cushion against the overnight reversal trend. However, with the copper market coming into the session today under pressure and platinum prices also soft, we can certainly understand the bear camp attempting to press the market. In the event that $8.60 support fails to hold, a slide to $8.54 support is possible, especially since the silver market looks to follow gold instead of forging its own track. As we have suggested several times over the last two weeks, the silver market is probably the most overbought of the metals (at least according to the COT reports) and therefore, we suspect the silver market will lead on the downside and lag on the upside. Near term resistance is pegged at $8.74, with a critical pivot point seen this morning at $8.72. METALS TECHNICAL OUTLOOK 12/6/2005 COMEX SILVER (MAR) 12/06/2005: The rally brought the market to a new contract high. Daily stochastics have risen into overbought territory which will tend to support reversal action if it occurs. The major trend could be turning up with the close back above the 18-day moving average. Market positioning is positive with the close over the 1st swing resistance. The next upside target is 882.0. The 9-day RSI over 70 indicates the market is approaching overbought levels. The next area of resistance is around 879.0 and 882.0, while 1st support hits today at 868.1 and below there at 860.1. COMEX GOLD (FEB) 12/06/2005: The market rallied to a new contract high. Daily stochastics have risen into overbought territory which will tend to support reversal action if it occurs. The cross over and close above the 18-day moving average indicates the longer-term trend has turned up. Since the close was above the 2nd swing resistance number, the market's posture is bullish and could see more upside follow-through early in the session. The near-term upside objective is at 516.8. The 9-day RSI over 70 indicates the market is approaching overbought levels. The next area of resistance is around 515.3 and 516.8, while 1st support hits today at 509.9 and below there at 505.9.
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, 6 December 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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