bullion intraday

Major Headlines:

· Gold rose to the highest in two weeks after the dollar dropped to a record against the euro Silver also gained. And gold Rises $16.30 To Close At $948.30 An Ounce On Comex The dollar is weaker, and that is helping out gold, The euro climbed to $1.5979 on speculation the European Central Bank will keep its benchmark-lending rate steady to curb inflation



· Gold will rebound to $1,000 an ounce this year, buoyed by a weaker dollar and it gained 35 percent in the past year, while the euro climbed 17 percent as the Federal Reserve slashed U.S. borrowing costs six times.



· Net speculative long positions in New York gold futures, or bets prices will rise, peaked this year at 212,259 contracts in February. Most recently they stood at 165,393 contracts, according to U.S. Commodity Trading Commission data



· Demand for commodities from hedge funds and other speculators has probably shifted to crude oil and bullions in the past few weeks



· Hochschild Mining Plc, Peru's second-largest silver producer, said first-quarter output advanced 68 percent and it's ``on track'' to meet a 2008 target. Production rose to 4.31 million ounces in January through March, from 2.56 million ounces a year earlier, Lima-based Hochschild said today in a statement. Gold output gained 3.3 percent to 44,060 ounces. The average realized price was $17.28 an ounce for silver and $933 an ounce for gold.



· China's National Bureau of Statistics said that real GDP was up 10.6% in the first quarter of 2008 from a year ago, better than expected. The People's Bank of China then increased the reserve requirement from 15.5% to 16.0%, the third increase this year. July copper is trading higher with buyers encouraged that demand from China will continue to stay strong.

US Economy:

· Merrill Lynch & Co. will report $6 billion to $8 billion in new write-downs when it releases financial results this week, bringing the total since October to more than $30 billion



· The dollar pared its loss against the euro after a report showed industrial production in the U.S. unexpectedly rose the most since November last month, helped by an increase at utilities and demand for business equipment.



· Fed Rate Outlook: Futures on the Chicago Board of Trade showed a 28 percent Chance that policy makers will reduce the fed funds target by a half-percentage point to 1.75 percent on April 30, compared with a 42 percent likelihood a week ago. The rest of the odds were for a reduction of a quarter-percentage point.

Currency Update:

· The European inflation rate accelerated to 3.6 percent last month, the highest in almost 16 years, The March figure is up from 3.3 percent in February and exceeds an estimate of 3.5 Percent published on March 31.



· European government notes pared losses after a U.S. government report showed housing starts fell more than forecast last month



· The U.S. currency had its biggest decline versus the euro in three weeks, dropping as low as $1.5969. The Canadian and Australian dollars and Norwegian krone increased after crude oil rose to a record of $114.95 a barrel. The euro touched 80.76 pence against the pound, the highest since the European currency's 1999 debut



MCX Gold June (Daily Chart)


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 21-day EMA. The downside closing price reversal on the daily chart is somewhat negative

Recommendations–MCX Gold June: Buy at12115 Target12210 and 12290 Stoploss at12060



MCX Silver May (Daily Chart)



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 21-day EMA. The downside closing price reversal on the daily chart is somewhat negative

Recommendations-MCX Silver May: Buy at 23610 Target 23850 and 24110 Stop loss at23440


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