bullion intraday

Bullion
30 May 2008 10:37:48



Bullion May 30 2008

Major Headlines:


Gold tumbled the most in a month as the dollar rallied, reducing the appeal of the precious metal as an alternative investment. Silver also declined.

The dollar climbed as much as 0.6 percent against a weighted basket of the euro, yen and four other major currencies on speculation that the Federal Reserve may begin to raise U.S. borrowing costs this year to curb inflation. Crude oil erased an earlier decline after U.S. fuel inventories dropped

European central bankers have expressed ``personal opinions'' to renew an agreement to limit annual gold sales, they agreed to limit their gold sales to 500 metric tons a year through September 2009. The banks probably won't announce their plans until early next year,

Seven interest-rate cuts since September helped send the dollar to an all-time low against the euro and gold to a record, The federal funds rate is at 2 percent, down from 5.25 percent when the Fed began cutting rates in September to blunt the effects of a housing slump and a credit crisis that threatened to push the economy into a recession.

Mining companies may reduce their forward sales by a total of about 10 million ounces this year, GFMS said. They cut a record 14.3 million ounces last year; Gold averaged $923.82 an ounce in the first quarter, compared with $789.31 in the fourth quarter. Miners can agree to sell future production at current prices to protect against losses caused by sudden declines, a strategy known as hedging

Russia's foreign currency and gold reserves, the world's third largest, raised to a record $548.1 billion last week, the central bank said, the value of reserves increased by $7.3 billion in the week ended May 23, Moscow-based Bank Rossii, the central bank, The reserves gained $4 billion in the previous week.

ETF Securities Ltd. said its assets in precious metals reached $2 billion after one year, mostly in gold and platinum, The ETFS Physical Gold exchange-traded fund holds 1.1 million ounces worth more than $1 billion, while ETFS Physical Platinum has 360,000 ounces worth more than $776 million, ETFS Physical Silver has 9.6 million ounces worth about $175 million and ETFS Physical Palladium attracted 199,000 ounces of investor demand worth more than $90 million. The funds started trading on April 23 last year

U.S.Economy:
The U.S. Commerce Department said that real GDP was up .9% in the first quarter and up 2.5% from a year ago, as expected. Nominal GDP was up 4.8% from a year ago, a far cry from recession. The June U.S. T-bonds are steady to lower.
The U.S. Labor Department said that jobless claims were up 4,000 last week to 372,000, roughly as expected. The March eurodollars are lower

Currencies update:

The Conference Board said that its index of leading indicators for Australia was down .4% in March to 184.2. The June Australian dollar is trading lower.


MCX Gold June - Technical Outlook:


The daily stochastic have crossed over down which is a bearish indication. The stochastic 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.


Market is expected to remain negative and the support is seen at 11941 If market breaches below 11941 may see prices to take further correction towards 11782 and 11531 However if it holds back above 12351 may see prices to rise further on today. Major resistance is seen at 12602 and 12761

Recommendations–MCX Gold June: Sell at 12145 Target 12020 and 19890 Stoploss at 12195


MCX Silver July - Technical Outlook:

The daily stochastic have crossed over down which is a bearish indication. The stochastic 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.

Market is expected to remain negative and the support is seen at 22549 If market breaches below 22549 may see prices to take further correction towards 22007 and 21065 However if it holds back above 24033 may see prices to rise further on today. Major resistance is seen at 24975 and 25517

Recommendations-MCX Silver July: Sell at 23240 Target 22950 and 22780 stoploss at 23415


MCXARUN
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