bullion intraday

Bullion




Gold rose on last week and headed for its first weekly advance in a month as record energy costs and a weaker dollar boosted demand for a hedge against inflation. Silver rose for a second day



The euro gained from an eight-week low against the dollar after European Central Bank President Jean-Claude Trichet said inflation remains the bank's priority, signaling policy makers won't cut interest rates soon.



Record crude oil prices will help keep the precious metal supported as demand for a hedge against inflation may rise



Crude-oil futures reached $126.27 a barrel Friday, setting a record for the fifth straight session, and the dollar headed for a weekly loss against the euro. Gold has under performed oil and the euro since reaching a record $1,033.90 an ounce on March 17,when investors bought the metal as a haven against turmoil in financial markets



Gold rebounded mainly on the dollar's decline and we can see actual demand now after the precious metal declined more than 14 percent from a record $1,032.70 an ounce on March 7,Gold seemed to be undervalued compared with oil and may try to test $930 an ounce in a few days.



The rupee declined 2.3 percent last week to 41.60 per dollar, according to data compiled by Bloomberg. That's the biggest weekly decline since May 1998,The rupee is the second-worst performer this year among Asia's 11 most-traded currencies as a 31 percent jump in the commodity's price raised concern that import costs will rise and widen the nation's current-account deficit



Indian spot gold rose 1.6 percent and closed above the 12,000-rupee mark on Friday, tracking overseas gains, but a weaker rupee kept domestic demand lacklustre. In London, gold rose as record oil prices stoked inflation jitters and as the dollar weakened against the euro. Gold moves in line with high oil prices as investors hedge against inflation and counter to the dollar as it is seen as an alternative asset.

U.S. Economy:

The U.S. Census Bureau said that exports were down $2.6 billion in March, to $148.5 billion while imports were down $6.1 billion to $206.7 billion. The result was $58.2 billion of net imports, less than expected. The June U.S. dollar index closed down .44 at 73.22.

Currencies update:

Statistics Canada said that Canada's unemployment rate increased from 6.0% to 6.1% in April with a net gain of 19,000 jobs, more than expected. Over the past year, 348,000 new jobs have been added to the economy. The June Canadian dollar closed up 1.10 cents at 99.32.

Canada's exports increased 1.6% in March, to C$40.1 billion while imports were down .3% to C$34.5 billion. The result was C$5.5 billion of net exports, the most since May of 2007.

The Reserve Bank of Australia said that it expects consumer prices to have an annual increase of 4.5% by the end of 2008, but then lessen to 3.25% sometime in 2009. The June Australian dollar was unchanged at 93.87

MCX Gold June

Technical Outlook:The daily stochastic have crossed over up which is a bullish indication. The stochastic 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 EMA. The downside closing price reversal on the daily chart is somewhat negative.

Market is expected to remain positive and the resistance is seen at 12001 levels. If market breaches 12001may see prices to take further upside towards 12090and 12250 however if it holds back below 11752 may see prices to fall further on today. Major support is seen at 11592 and 11503

Recommendations–MCX Gold June: Buy at 11835 Target11920 and 11990 Stoploss at11775



MCX Silver July

Technical Outlook: The daily stochastic have crossed over up which is a bullish indication. The stochastic 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 EMA. The downside closing price reversal on the daily chart is somewhat negative.

Market is expected to remain positive and the resistance is seen at 23274 levels. If market breaches 23274 may see prices to take further upside towards 23576 and 23976 however if it holds back below 22572 may see prices to fall further on today. Major support is seen at 22172 and 21870

Recommendations-MCX Silver July: Buy at 22780 Target 22950 and 23150 Stop loss at 22550

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