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-- Posted Wednesday, 1 March 2006 | Digg This Article
METALS: OVERNIGHT CHANGES THROUGH 4:00 AM: GOLD +0.80, SILVER +2.00
London Gold Fix $562.50 +$6.10 LME COPPER STKS 115,275 ml tns +6,375 tons
COMEX GOLD stks 7.518 ml oz -6,053 oz COMEX SILVER stks 127.8 ml oz -71,669 oz OVERNIGHT ACTION: With overnight action holding the prior day's gains, the trade seems to have fostered the bull case again. GOLD: Both London and Tokyo gold opened higher in response to the gains forged in the US session on Tuesday and therefore the bias has apparently shifted back toward the upside. We still doubt that the gold market will see a full return to the type of concentrated buying interest that was present in the November through early February time frame, but nonetheless the path of least resistance does seem to be pointing upward again. Certainly the decline in the US Dollar has allowed gold to rise, but with both platinum and copper providing some added bullish incentive this week, the outside influences on the gold market have become supportive again. Apparently some bank buying in Chinese overnight served to lift Chinese gold prices and that type of interest could actually give the gold market yet another theme to justify an upward track in prices. Therefore, the overnight new high for the move trade of $565.3, would seem to target a rise to $570. In fact, an early decline below 90.00 in the March Dollar Index, could whip up enough currency interest in gold to spark a $2-$3 rally in gold market in the wake of the scheduled US economic numbers this morning. SILVER: Even though the silver market managed to trade above the prior day's high overnight, we still get the sense that aggressive bullish momentum is lacking. However, with both platinum and copper showing generally positive action this week, the silver is potentially in a unique position to benefit from the precious metals and industrial metals market psychology. Therefore, we have to conclude that the path of least resistance is pointing upward and that the May silver could make another quick bid at the $10.00 level, before the end of the week. In a partially negative note, Mexico announced that their December 2005 mining output increased by 12.8% over prior year levels and that would certainly hint at higher silver supply flow from that country. In other partially disappointing news, it seems that the hope for a quick authorization of a silver ETF is being delayed somewhat and that could discourage some impatient bulls. Near term close-in support in the May silver comes in today at $9.75, with initial resistance seen this morning up at $9.86. METALS TECHNICAL OUTLOOK 3/1/2006 COMEX SILVER (MAR) 03/01/2006: Rising stochastics at overbought levels warrant some caution for bulls. The cross over and close above the 18-day moving average indicates the longer-term trend has turned up. A positive setup occurred with the close over the 1st swing resistance. The near-term upside target is at 990.0. The next area of resistance is around 982.0 and 990.0, while 1st support hits today at 962.1 and below there at 950.1. COMEX GOLD (APR) 03/01/2006: Positive momentum studies in the neutral zone will tend to reinforce higher price action. The market now above the 18-day moving average suggests the longer-term trend has turned up. The market's close above the 2nd swing resistance number is a bullish indication. The near-term upside target is at 568.6. The next area of resistance is around 567.0 and 568.6, while 1st support hits today at 560.8 and below there at 556.3.
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-- Posted Wednesday, 1 March 2006 | Digg This Article
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