comex gold intraday

Gold Outlook
07 May 2008 12:03:31



Gold prices advanced for the third day in a row, continuing recovery following last week’s sharp losses, supported by a rally in oil prices to a fresh high above $122 a barrel and weakness in the dollar.



International spot gold traded in the range $870.70 - $882.70 and last quoted at $875.05 ($873.05).



Dollar eased further against the euro despite an unexpectedly strong data from the US Service sector. According to the data released on Monday, the ISM's non-manufacturing index rose to 52.0% in April from 49.6% in March.



The greenback was affected by the Federal Reserve’s senior loan officer survey, which found Consumers and businesses found it harder to borrow money over the past three months, which indicates that the credit crunch might be still worsening despite the Fed’s grave efforts.



The Fed last week had cut its overnight lending rate by 25 basis points to 2 percent and signaled that its next move would depend on developments in financial markets and the economy. The Feds signal boosted the optimism of the traders in the currency market. Since mid-September, the US central bank has slashed the fed funds rate target by 3.25 percentage points to shore up an economy.



The Conference Board’s April consumer confidence index had descended to 62.3 from an upwardly revised reading of 65.9 in March.



Also the University of Michigan/Reuters' consumer sentiment index declined to 62.6 in April from 69.5 in March.



The US Commerce Department had revealed that the nation's trade deficit expanded unexpectedly by 5.7% to $62.3 billion in February.



Oil prices crossed above $122 a barrel yesterday, for the first time ever, on global supply concerns, especially due to geo-political tension in Nigeria, where a militant attack disrupted oil production in facilities belonging to Anglo-Dutch oil group Royal Dutch Shell.



Crude oil June in NYMEX traded as high as $122.73 and closed at $121.80.



Medium term outlook (Spot Gold)

Weak below $881; supports are $872, $861, $849, $835, $817, $800; resistances $896, $906, $926.


Last day DGCX Gold June traded in the range $873.70 – $884.70 and closed at $878.20 ($875.10).


DGCX Gold June


TECHNICAL OUTLOOK (Intra-day)

GOLD (June) - Bullish above $ 877.90; bearish below $ 873.00

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important MCX charts

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safe trade calls

GOLD


PRICE TURN EXACT FROM OUR GIVEN RESISTANCE. book profit on buy abv 11375/11525, for the day buy only abv 11650 S/L 11625 and T/p 11685-700/upto 11750-75 OR sell below 11500 S/L 11525 and T/p 11460/425/ 375/11330-295/down rally (any time close above 11650/12000/12300-400/ 13100/13425 bullish while close below 11000-10925 bearish for medium term)

SILVER


PRICE TURN EXACT FROM OUR GIVEN RESISTANCE. book profit on buy abv 22200/22550, for the day buy only abv 22825 S/L 22750 and T/p 22900-23000 upto 12100 OR sell below 22375 S/L 22450 and T/p 22275-240/ 22150/22050/ sustain below test 21950/ 21800/21725-650/21575/down rally (any time close below 21575-500/20400/ 19250/18775 bearish rally while close above 22825/23600/24500/26300/27700 bullish for medium term)

CRUDE


EIA Crude oil inventory data schedule to release today. book profit on buy abv 4875, for the day buy only abv 5000 S/L 4980 and T/p 5025-50 upto 5080 OR buy ard 4870-75 S/L 4865 and T/p 4910-4935, now ard 4775 seen strong support again (now crude need to close above 5000 for bullish rally while close below 4695/4475/4365/4260/4080/3960-3905 bearish for medium term)

COPPER


book profit on buy abv 343.5-344, for the day sell only below 343-342.5 S/L 344.25 and T/p 341-40/sustain below test 335-332 atleast OR buy only abv 350 S/L 348.75 and T/p 352-353.5/356-358.5/361.5/uprally (upside strong rally only on close above 361.5 while close below 340/330-326.5/310 bearish for medium term)


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energy intraday

Energy
07 May 2008 10:22:26

Major Headlines:

The oil-service sector rose for a third consecutive session Tuesday after crude futures continued their upward momentum, made a record high of above $122.50 level for the first time amid heightened supply worries and dollar softness.

The dollar weakened against the euro on Tuesday, attracting investors to oil and other commodities viewed as hedges against inflation. Also, a falling dollar makes oil less expensive to investors overseas. A series of U.S. Federal Reserve rate cuts starting last year weakened the dollar considerably against foreign currencies, and analysts blame the dollar's protracted decline for oil's sharp rise this spring.

Oil prices surged to set new record highs on both sides of the Atlantic after the dollar gave up more of its recent gains, encouraging more investors into a market already spooked by supply fears out of Nigeria and Iran.

Supply outages or potential threats to supply emerged in Iran and Nigeria over the weekend and from Iraq on Monday; events in all three nations have caused prices to spike many times in recent months.

In Iraq, Kurdish rebels warned they could launch suicide attacks against American interests to punish the U.S. for sharing intelligence with Turkey after Turkey bombed rebel bases in Iraq on Friday. In Nigeria, a Royal Dutch Shell PLC spokesman said attackers hit an oil facility belonging to Shell's joint venture in southern Nigeria and that some oil production has been shut down. And Iran's Supreme Leader Ayatollah Ali Khamenei said his country would not bend to international pressure and give up its nuclear program.

Natural gas futures rose Tuesday on the back of higher physical gas prices, rising crude oil prices and concerns about supplies this summer and fall.

Forecasters were calling for chillier-than-normal weather this week in the U.S. Midwest, with highs in Chicago dipping into the 50s Thursday, Temperatures in New York are seen reaching into the 70s during the day, dropping to the high 50s overnight

The gas market has been keeping a close eye on a continuing outage since April 8 at the giant U.S. Gulf Coast natural gas platform Independence Hub. Enterprise Product Partners (EPD), which operates the pipeline that connects the platform to shore, has said operations were likely to restart by May 15. Market participants said the outage is supporting gas prices, which could strengthen further if Independence doesn't return to service by mid-month.





MCX Crude Oil May

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 4841 levels. If market breaches 4841 may see prices to take further upside towards 4993and 4986however if it holds back below 4696 may see prices to fall further on today. Major support is seen at 4703 and 4551

Recommendations-MCX Crude Oil May: Buy at 4930 Target 4995 and 5065 Stop loss 4875



MCX Natural gas May

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 464.10 levels. If market breaches 464.10 may see prices to take further upside towards 470.20 and 476.00 however if it holds back below 452.20 may see prices to fall further on today. Major support is seen at 446.40 and 440.30

Recommendations-MCX Natural Gas May: Buy at 455 Target 465 and 472 Stop loss at 448


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bullion intraday

Bullion
07 May 2008 10:07:06



Gold rose for a third consecutive trading session as crude oil gained, spurring investors to buy the metal as a hedge against inflation. Platinum and silver also advanced.

Dollar weakness has encouraged some investors to buy into hard commodities of late, in a bid to hedge against weakness in the U.S. currency and rising inflation

ECB Says Gold And Gold Receivables Remained Unchanged In Week

The bargain hunters among precious metals traders surely came out of the woodwork yesterday, a welcome sign after the beatings absorbed last week. And all last month, for that matter, as gold fell by 6.1% in April, the biggest monthly drop in four years.

It was also a very supportive week on the part of the usual suspects, surging energy prices and a dollar that has begun collapsing again after its strength in the wake of the latest round of interest rate cuts

Crude oil traded at a record $122 a barrel in New York today and Goldman Sachs Group Inc. said the fuel might reach $150 to $200 within two years. European Central Bank President Jean- Claude Trichet yesterday said he saw significant global inflation risks because of higher commodity prices

These are rich times for many gold miners. Barrick Gold, the world's largest gold producer, said that it earned $514 million in the first quarter, up from a $159 million loss a year ago. They also said that they expect to produce around 7.8 million ounces this year at a cash cost of roughly $400 per ounce.

On the other hand, the world's third largest gold producer, AngloGold Ashanti, posted a loss in the first quarter because much of its gold sales were hedged at a lower price



The downward pressure on new gold supply is still there. People aren't producing the gold that you would expect at these gold prices. Fundamentally, there's good support for the gold price.’ On gold averaging $900 an ounce this year, said Mark Bristow, chief executive officer of Randgold Resources Ltd.,



Investment in the StreetTracks Gold Trust, the biggest exchange-traded fund backed by bullion, has dropped 13 percent to 580.4 metric tons from a record 663.8 tons on March 17



U.S. Economy:

More than half of the banks surveyed by the Fed said they had tightened commercial and industrial loans, commercial real estate loans, residential mortgages, and home-equity lines of credit. Almost no banks eased credit terms for any type of loan, the Fed said in its quarterly senior loan officer survey

Currencies update:

An index of services in the U.K. fell from 52.1 to 50.4 in April, weaker than expected.

The Reserve Bank of Australia met and kept its interest rate unchanged at 7.25%, saying that there is evidence that domestic demand is slowing.

Canada issued C$5.6 billion of building permits in March, down 4.5% on the month



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 11672 levels. If market breaches 11672 may see prices to take further upside towards 11754 and 11859 however if it holds back below11485 may see prices to fall further on today. Major support is seen at 11380 and 11298





Recommendations–MCX Gold June: Buy at 11540 Target11690 and 11760 Stoploss at11490



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 22835 levels. If market breaches 22835 may see prices to take further upside towards 23019 and 23247 however if it holds back below 22423 may see prices to fall further on today. Major support is seen at 22195 and 22011

Recommendations-MCX Silver July: Buy at 22520 Target 22710 and 22850 Stop loss at 22370


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GENERAL MARKET CONDITIONS

Copper shocked everybody as comex July futures rose to a record high of $427 just after the comex open and then crashed after mine workers at codelco mines agreed to end the 20 day strike. London Metal Exchange (LME) was closed yesterday else copper would have easily crossed the $9000 mark. The US is the hub of global paper trade while London is the hub of physical trade. Prices are never sustainable unless it is backed by adequate physical demand. We have seen this with gold, silver and some other base metals. Crude oil prices are firm despite greater investment demand as it is also backed by physical demand. Copper will find buyers on dips as long as LME (3 months) holds $8000.

Momentum traders were caught in the whirl pool of copper’s rise. One of my clients was short in comex copper around $396, the sudden rise scared the wits of him and he reversed his trade at $421 only to exit at $408. This person made a double loss while trading. Whenever prices reach a new historical level one needs to check the sustainability of the rise. One should wait and if prices stabilize then go long else go short. Stop losses are useless. One needs to keep in mind the stop loss prices before the trade is done but exit at market prices. Stop losses are bound to get triggered if one put it on the trading screen.

COPPER -- JULY FUTURE

Yesterday's rise to $427 was fake. For the day as long as copper holds $382 and $369 downside will be limited and copper can target $404 and $412.

NYMEX CRUDE OIL -- FUTURE

A break of $120.60 will result in $121.60 and $125.20. On the lower side only a consolidated fall below $116.20 will result in $113.20.

INDIAN RUPEE (USD/INR)

The Rupee has been consolidating in 40.44-40.77 wider range and should break out from this range soon. In the short run unless the rupee breaks 40.88-41.00 zone, the rupee will continue to find sellers on the rise. I have been asked whether the rupee has bottomed out at 39.25. The Rupee has room for more gains in the medium term, but the pace of gains will be slower than 2007. Crude oil prices and the performance of global equities will be the key for the rupee in the medium term. If crude oil continues to rise and global stock markets shag in the medium term, the rupee may reverse the direction from bullish to bearish. Average volatility will be around twenty paise in the next few weeks. Key intra day supports are 40.28 and 40.42 while resistance is at 40.73 and 40.88.

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