comex gold intraday

Gold prices drifted lower yesterday, as moderate recovery in the Dollar brought about profit taking following the previous days’ rally. But firm oil prices remained supportive for the yellow metal.



International spot gold traded in the range $954.50 - $939.95, and last quoted at $947.40 ($953.50).



Dollar found some support in the report from US Labor Department released yesterday, which revealed that initial claims for state unemployment benefits fell 9,000 to 366,000 in the week ended March 22. However the four-week average of initial claims rose 1,750 to 358,000.



Also continuing claims for benefits fell 5,000, to 2.85 million for the week ended March 15. The four-week average of continuing claims rose 25,250 to 2.82 million.



The US economy grew at 0.6 % annual rate in the fourth quarter according to the Commerce Department estimate made public yesterday. This was as per expectations and consistent with the two previous estimates, but the slowest pace since 2002.



The Euro had gained in the previous day inspired by robust data from the Euro-zone’s two biggest economies.



Germany's Ifo institute reported that business confidence in the Europe's biggest economy rose for a third consecutive month. Also, French business sentiment rose unexpectedly in March, reaching its highest level so far this year, according to national statistics office INSEE.



The US Commerce Department reported on Wednesday that sales of new homes in the US fell to a 13-year low in February, dropping 1.3% to a seasonally adjusted annual rate of 590,000.



US consumer confidence index had fallen in March to 64.5 from a revised reading of 76.4 in February, according to a US Conference Board release on Tuesday.



But the report from National Association of Realtors released on Monday had shown that resale of homes rose 2.9% to a seasonally adjusted annualized rate of 5.03 million. The rise was above expectations, and the first in seven months.



Gold had corrected from record high levels reached earlier last week, along with oil, as the Dollar bounced back moderately from record-low levels versus the Euro after the Federal Reserve cut its benchmark interest rate by 75 basis points to 2.25 percent.



The latest rate cut has been the sixth since last September, and has made the reduction in the federal funds rate to 300 basis points, to the lowest point since late 2004. But many market participants and analysts had anticipated an even more severe cut by the Fed, a full 100 basis points, amid serious concerns regarding a recession in US economy.



Crude oil for May delivery in NYMEX settled at $107.26 ($106.21) a barrel, after trading in the range $105.03 - $108.22.



The latest weekly update by US Energy Department’s Energy Information Administration had said US crude stockpiles remained unchanged at 311.8 million barrels in the week ended March 21, while a rise of around 1.5 million barrels had been widely expected.



The economic worries and a nose-diving dollar had propelled spot gold to record an all-time high of $1030.80 a Troy ounce last week.



The Federal Reserve in a an unexpected move had cut its discount rate for direct loans to banks by 0.25 percent point to 3.25 percent, and launched a new discount window facility for primary dealers, in desperate moves to stabilize financial markets.



The emergency moves by Fed boosted speculations regarding the possibilities for more casualties in the widening US financial crisis.



Meanwhile, the US Commerce Department reported that the US trade deficit widened slightly in January, up 0.6% to $58.2 billion.



Medium term outlook (Spot Gold)

Bullish above $916; Resistances are $926, $932, $947, $954, $973, $984, $995, $1002, $1022, $1035, $1052; supports $896, $883. Further up-trend is expected above $954.60.



Last day DGCX Gold June traded in the range $958.80 – $945.80 and closed at $953.50 ($955.20).



DGCX Gold June


TECHNICAL OUTLOOK (Intra-day)

GOLD (June) - Bullish above $ 955; bearish below $ 949

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basemetals intraday

Major Economic Data:

§ The U.S. Commerce Department said again that real GDP in the fourth quarter was up an annual rate of .6%, the same as its estimate one month ago. For all of 2007, real GDP was up 2.2%. The December eurodollars are steady.

§ The U.S. Labor Department said that jobless claims were down 9,000 last week to 366,000.

Major Headline:

§ Copper jumped the most in three weeks as inventories slumped to a seven-month low, raising concern that supplies may trail demand this year.

§ Copper production fell 42,000 metric tons short of demand last year, the International Copper Study Group said. The deficit compares with a surplus of 287,000 tons in 2006,

§ UBS boosted its 2008 copper forecast by 17 percent today, citing output constraints. The metal will average $3.50 a pound this year, the Zurich-based investment bank said. That compares with a previous forecast of $3. Before today, copper has averaged $3.5062 this year on the Comex.

§ Copper demand will outpace production by 100,000 metric tons this year, UBS said. Risks to output in Zambia, China and Chile, the world's biggest source of the metal, ``have increased in the past several months,'' Brebner said. In February, snowy weather and power outages disrupted copper production in China. In Chile, contract workers at state- owned Codelco, the world's biggest copper producer, plan to strike, a labor leader said last week, threatening production.

§ Zambia's trade surplus widened to 168 billion kwacha ($45.8 million) in February on increased exports of copper from the southern African country, the Central Statistics Agency said.

§ The surplus rose from a revised 42.1 billion kwacha in January, Modesto Banda, acting director of the agency, said in a statement in the capital, Lusaka, today.

§ Copper accounts for about 70 percent of Zambia's export earnings and production has risen in recent years as the government sold the industry back to investors, after taking it over from Anglo American Plc in the early 1970s.

§ Exports rose 8.3 percent to 1.3 trillion kwacha in February from a month earlier, while imports fell 23 percent to 1.1 trillion kwacha, the statistics office said. Refined copper accounted for 81.8 percent of exports in February, compared with 81.7 percent in January

§ Nickel advanced for a third day in London on speculation demand from China, the world's largest user, will expand because of rising production of stainless steel. Copper and tin also gained.

§ Chinese stainless steelmakers will probably boost output by 23 percent this year to 9.1 million metric tons because of strong domestic demand and plant expansion, Macquarie Group Ltd.'s analyst Bonnie Liu said. About 70 percent of world nickel production is used in stainless steel.

§ Recovery in stainless steel demand and increases in coking- coal prices will boost nickel, Liu said today at a conference in Hong Kong. Growth in Chinese nickel imports are a ``natural result,'' she said.

MCX Copper April (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 9-day EMA. The downside closing price reversal on the daily chart is somewhat negative.

Recommendations -MCX Copper April: Buy at 338 Target 349 and 356 Stop loss 332


MCX Zinc March (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 9-day EMA. The downside closing price reversal on the daily chart is somewhat negative.

Recommendations -MCX Zinc March: Buy at 94.50 Target 97 and 98.80 Stop loss at 93.15



MCX Nickel March (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 9-day EMA. The downside closing price reversal on the daily chart is somewhat negative.

Recommendations:MCX Nickel March: Buy at 1225 Target 1280 and 1295 Stop loss at 1205



MCX Lead Feb (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 9-day EMA. The downside closing price reversal on the daily chart is somewhat negative.

Recommendations: MCX Lead March: Buy at 115.50 Target 117 and 119 Stop loss at 114.20

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tecnical bullion charts

click the pics to large view







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Energy intraday

§ Oil prices raced higher as a pipeline blast in key crude producer Iraq sparked supply jitters and geopolitical tension.

§ An explosion was reported at an oil pipeline in southern Iraq, near Basra. It is not yet known what impact the damage will have on Iraq's exports. It was the second attack on an Iraqi pipeline this week. May crude oil is steady.

§ The dollar has recouped earlier losses on relief that today's US GDP data did not yield any nasty surprises. The news that the Commerce Department left US GDP growth at an unrevised annualised rate of 0.6 pct, with consumer spending higher, bolstered US stock futures, helping the dollar to climb towards day highs against both the euro and the yen.

§ The U.S. Department of Energy said that underground supplies of natural gas were down 36 billion cubic feet last week to 1.277 trillion cubic feet. Supplies are now down 16% from a year ago.

MCX Crude Oil April (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 9-day EMA. The downside closing price reversal on the daily chart is somewhat negative.

Recommendations-MCX Crude Oil April: Buy at 4245 Target 4315 and 4365 Stop loss 4215

MCX Natural gas April (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 9-day EMA. The downside closing price reversal on the daily chart is somewhat negative.

Recommendations- MCX Natural Gas April: Buy at 385 Target 393 and 399 Stop loss 376

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SAFE TRADE CALLS

GOLD

now as long support 11875-825, expect some upside test 12175-275-400 ALMOST ACHIEVED. for the day buy only abv 12400 S/L 12370 and T/p 12425/500 upto 12550 in coming days OR sell below 12210 S/L 12230 and T/p 12185-80/12115-125/sustain below test 11950 atleast in coming days (any time close above 12400/13100/13400 bullish while close below 12115/11830/11575-475/11300/10950-900/10500/10050/ 9850/9575 bearish for medium term)

SILVER

for the day buy only abv 24000 S/L 23925 and T/p 24100/24300-400 atleast OR sell below 23525 S/L 23610 and T/p 23450/23300-250/sustain below test 23000 atleast in coming days (any time close below 22900/22100-21975/21250/ 20150/19390/18600-250/17850 bearish rally while close above 24000/26100/ 27500 bullish for medium term)

CRUDE


book profit on buy abv 4240, fresh buy only abv 4315 & more abv 4335 S/L 4300 and T/p 4360/4405 atleast OR sell below 4245 & more below 4225-4200 S/L 4265 and T/p 4140-50 atleast (now crude need to close above 4335/4460-85 for bullish rally while close below 4030/3960/3830/3585/3415-3390 bearish for medium term)

COPPER


now as long resist 342.5, expect down trend continue, book profit on buy abv 331.5, fresh buy only abv 342.5 S/L 340.75 and T/p 345-347.5/sustain abv seen new rally OR buy ard 333-333.1 S/L 332.5 and T/p 335-37, sustain below 331.5 test 328-326 atleast (upside strong rally only on close above 342.5/348/354 while close below 329/ 310.5-303/281/267.5/254.5/235 bearish for medium term)


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bullion intraday

§ Gold fell in New York after the dollar rebounded against the euro. Silver also declined.

§ The dollar rose as much as 0.8 percent against the euro after falling within 1 cent of the all-time low yesterday. Gold reached a record $1,033.90 an ounce on March 17 when the euro rose to the highest ever.

§ Investment demand in the Street Tracks Gold Trust, the biggest exchange-traded fund backed by bullion, has remained unchanged at 634 metric tons this week after reaching a record 663.8 metric tons on March 17.

§ The US government says fewer people signed up for unemployment benefits last week, although that didn't change the broader picture of a slower jobs market. The US economy nearly sputtered out in the final quarter of last year and is probably faring even worse now amid the continuing housing, credit and financial crises.

§ Russians are opening a record number of precious metals bank accounts and buying more bullion as gold trades near its all-time high, the country's biggest bank said.

US Economy:

§ The Commerce Department reported Thursday that gross domestic product increased at a feeble 0.6 percent annual rate in the October-to-December quarter. The reading - unchanged from a previous estimate a month ago - provided stark evidence of just how much the economy has weakened. In the prior quarter, the economy clocked in at a sizzling 4.9 percent growth rate.

§ The Labor Department, in a new report Thursday, says new applications filed for unemployment benefits last week fell by a seasonally adjusted 9,000 to 366,000. That level of 366,000 was better than the 371,000 that many economists were forecasting. Still, economists predict the nation's labor market will slow and unemployment will rise this year, given the credit and financial crises.

MCX Gold Apr (Daily Chart)



Technical Outlook:Momentum studies are bearish but are now at oversold levels and will tend to support reversal action if it occurs. The daily stochastics have crossed over down which is a bearish indication. The stochastics indicators are decreasing from overbought level, which is bearish and should support lower prices. The market's short-term trend is negative as the close remains below the 9-day EMA. The upside closing price reversal on the daily chart is somewhat positive.

Recommendations -MCX Gold April: Buy at 12245-30 Target 12320 and 12360 Stop loss 12210

MCX Silver May (Daily Chart)



Technical Outlook: Momentum studies are bearish but are now at oversold levels and will tend to support reversal action if it occurs. The daily stochastics have crossed over down which is a bearish indication. The stochastics indicators are decreasing from overbought level, which is bearish and should support lower prices. The market's short-term trend is negative as the close remains below the 9-day EMA. The upside closing price reversal on the daily chart is somewhat positive.

Recommendations -MCX Silver May: Buy at 23550 Target 23940 and 24160 stop loss 23415


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outlook

June gold closed slightly lower on Thursday as it consolidated some of this week's short covering gains. The mid-range close
sets the stage for a steady opening on Friday. Stochastics and the RSI are oversold and are turning bullish hinting that a short-
term low might be in or is near. Closes above the 20-day moving average crossing at 973.70 are needed to confirm that a short-
term low has been posted. If June renews last week's decline, the 38% retracement level crossing at 897.80 is the next downside
target. First resistance is the 10-day moving average crossing at 966.30. Second resistance is the 20-day moving average
crossing at 973.70. First support is last Thursday's low crossing at 909.00. Second support is the 38% retracement level
crossing at 897.80.

May silver closed higher on Thursday as it extends this week's short covering rally. The high-range close sets the stage for a
steady to higher opening on Friday. Stochastics and the RSI have turned bullish hinting that a short-term low might be in or is
near. Closes above the 20-day moving average crossing at 19.443 are needed to confirm that a short-term low has been posted.
If May renews last week's decline, the 50% retracement level crossing at 16.585 is the next downside target. First resistance is
today's high crossing at 18.685 then the 25% retracement level crossing at 19.015. First support is last Thursday's low crossing
at 16.725 then the 50% retracement level crossing at 16.585.

May copper closed higher on Thursday and above the 20-day moving average crossing at 379.45 confirming that a short-term
low has been posted. The high-range close sets the stage for a steady to higher opening on Friday. Stochastics and the RSI are
bullish signaling that sideways to higher prices are possible near-term. If May extends this week's rally, March's high crossing
at 402.40 is the next upside target. Closes below the 10-day moving average crossing at 371.80 would signal that a short-term
top has been posted. First resistance is today's high crossing at 389.40. Second resistance is March's high crossing at 402.40.
First support is the 10-day moving average crossing at 371.82. Second support is the 38% retracement level crossing at 358.50.

May crude oil closed higher on Thursday as it extends yesterday's rally above the 10-day moving average crossing at 105.05.
The high-range close sets the stage for a steady to higher opening on Friday. Stochastics and the RSI have turned bullish
signaling that sideways to higher prices are possible near-term. If May extends this week's rally, March's high crossing at
110.35 is the next upside target. Closes below last Thursday's low crossing 98.65 would renew this month's decline and could
lead to a test of the 38% retracement level of the 2007-2008- rally crossing at 94.17. First resistance is today's high crossing at
108.22. Second resistance is March's high crossing at 110.35. First support is the 10-day moving average crossing at 105.04.
Second support is the 25% retracement level crossing at 99.77.

May Henry natural gas closed slightly lower on Thursday as it consolidated some of this week's rally but remains above the 10-
day moving average crossing at 9.551. The high-range close sets the stage for a steady to higher opening on Friday. Stochastics
and the RSI are bullish signaling that sideways to higher prices are possible near-term. If April extends this week's rally,
March's high crossing at 10.365 is the next upside target. Closes below Monday's low crossing at 9.089 would temper the near-
term friendly outlook in the market. First resistance is today's high crossing at 9.770 then March's high crossing at 10.365.
First support is the 38% retracement level of this year's rally crossing at 9.117. Second support is the 50% retracement level of
this year's rally crossing at 8.732.

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GENERAL MARKET CONDITIONS

Yesterday was a base metals day as they rose sharply. Copper, Zinc, Nickel, lead and tin all rose sharply. Fund managers are taking fresh long positions in all base metals on expectations of very high demand in the second quarter. Fund managers just jerk up prices of any commodity as and when demand rises. It is for this reason that base metals are more volatile than gold and silver. But even on an intra day basis, base metals (including silver) give more returns than gold or any other precious metals. Steel and Nickel (apart from copper) should be the best performers for the rest of 2008 among the base metals. However base metals should fall in a big way before/just after the Olympics in China as incremental demand from china will start to fall.

Yesterday just before the London open the MCX gold April price fell from INR 12280 to INR 12116 in a few minutes. This was probably due to roll over long positions into the June series. As and when the current contract comes to a close, such movements are natural.

For the day it will be a technical trade in all metals and energies as the quarter comes to a close.

GOLD – JUNE FUTURE

Gold June targets $998.40 and $1039 in April as long as $919 and $898 holds.

COPPER -- MAY FUTURE

$385 price target achieved. Copper targets $402 and $432 in April as long as $365 and $337 holds.

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