Bullion Intraday

Gold rose in Asia on speculation a slowing U.S. economy may prompt the Federal Reserve to lower borrowing costs, boosting the appeal of the precious metal as an alternative investment to the dollar.

· MCX Gold April traded near Rs. 11559 per 10 gram and MCX Silver March traded near Rs. 21865 with positive trend. Similarly International Spot gold remain above $900 dollar mark and registered days high at $907.65, Silver rose towards high of $17.23

· The US dollar weakened against the yen and the euro in Asian afternoon trade Monday as investors bet on a deeper Federal Reserve interest rate cut next month on growing pessimism about the US economy.

· Traders increased bets the Fed will cut borrowing costs further to prevent the economy from falling into a recession. Futures contracts on the Chicago Board of Trade show traders see a 34 percent chance that the Fed will lower the target lending rate by 75 basis points at its next policy meeting on March 18, up from 30 percent a week ago. The odds of a 50-basis-point cut are 66 percent.

· Platinum rose to a record in Asia on concern that supply will be limited by electricity shortages in South Africa and damage to an Anglo Platinum Ltd. smelter. Futures in Tokyo surged the daily limit.

· Electrical equipment affected by an accident at the smelter will take four to six weeks to repair, the world's biggest producer of the metal said Feb. 15, adding to investor concerns about output reliability from South Africa, which represents about 80 percent of global supply.

Indian Bullion Spot Market

Precious metals finished down in spot markets mauled by a strong dollar. There was some upside support from an upbeat crude oil and on expectations of yet another interest rate cut by the Federal Reserve.

· In Mumbai markets, gold (995) finished at Rs 11,650 per 10 gm and gold (.999) at Rs 11,705/10gm respectively. Arrivals in gold were at 100 kilos. Silver (.999) closed at Rs 21,605/kg. Arrivals in silver were at 250 kilos.

· Chennai gold (995) and gold (.999) finished at Rs 11,750/10gm and Rs 11,800/10gm respectively whereas Silver (.999) closed at Rs 21,250/kg.

· Jaipur gold standard closed at Rs 11,750/10gm whereas Silver (.999) finished at Rs 21,600/kg.

· Ahmedabad gold (995) ends at Rs 11,590/10gm and gold (.999) ends at Rs 11,649/10gm respectively whereas Silver (.999) closed at Rs 21,600/kg.

· In Delhi bullion markets, gold (995) closed at Rs 11,640/10gm and gold (.999) at Rs 11,700/10gm whereas Silver (.999) ends at Rs 21,225/kg.

MCX Gold Apr

Technical Outlook:

Momentum studies are bullish but are now at overbought levels and will tend to support reversal action if it occurs. The daily stochastics have crossed over up which is a bullish indication. The stochastics indicators are rising from oversold level, which is bullish and should support higher prices. The market's short-term trend is positive as the close remains above the 9-day moving average. The downside closing price reversal on the daily chart is somewhat negative.

Recommendations:

MCX Gold April: Buy at 11510-520 for the target of 11640 and 11690 with stop loss at 11485

MCX Silver Mar

Technical Outlook:

Momentum studies are bullish but are now at overbought levels and will tend to support reversal action if it occurs. The daily stochastics have crossed over up which is a bullish indication. The stochastics indicators are rising from oversold level, which is bullish and should support higher prices. The market's short-term trend is positive as the close remains above the 9-day moving average. The downside closing price reversal on the daily chart is somewhat negative.

Recommendations:

MCX Silver March: Buy at 21820-800 for the target of 22100 and 22350 with stop loss at 21765

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