comex gold outlook

Gold Outlook
03 June 2008 11:25:55



Gold prices closed moderately higher yesterday, but pared some of the early gains after the dollar edged up against the euro.



International spot gold traded in the range $897.10 - $881.10 and last quoted at $889.50 ($885.90).



Dollar found support in better-than-expected manufacturing data from the US. The Institute for Supply Management's manufacturing index for May rose to 49.6% from 48.6% in April, against the consensus expectation of 48.7%.



An upward revision to first-quarter growth in the US helped the dollar to advance against the major counterparts last week, which pushed down the gold prices. According to the data released by Commerce Department on last Thursday, real gross domestic product of the US increased at a 0.9% annual rate in the first three months of the year, slightly faster than the previous estimate of 0.6%.



Better-than-expected survey on US durable goods orders also underpinned the greenback. Data from the Commerce Department showed new orders for US-made durable goods dropped less than expected 0.5 % in April, against the expectation for a 2.8% drop.



But among data from the US Labor market, the initial claims for state unemployment benefits rose modestly 4,000 to 372,000 in the week ended May 24, according to the Labor Department. However the four-week average of initial claims fell 2,500 to 370,500. Also continuing claims rose by 36,000 in the week ended May 17, reaching 3.10 million. The four-week average of continuing claims rose to 3.06 million, up 18,000.



The recent data from various sectors in the US have given mixed hints regarding the economy.



According to the release by US Conference Board last week, the consumer confidence index fell to 57.2 in May from a revised reading of 62.8 in April.



However the sales of new homes recovered during April for the first time in six months, rising 3.3% in April to a seasonally adjusted annual rate of 526,000, the Commerce Department reported.



Even so, the housing market worries remained. Standard & Poor's reported that the decline in home prices for 20 US metropolitan areas accelerated in March, dropping 14.4% from the past year.



Earlier, the National Association of Realtors had reported a 1 % drop in the resale of houses and condos to a seasonally adjusted annualized rate of 4.89 million in April, from 4.94 million in March.



The minutes from the Federal Open Market Committee's April 29-30 meeting had invigorated worries about the economy. The minutes released last week revealed that the Fed sharply increased its inflation outlook for the current year and downwardly revised the forecast for economic growth for 2008.



Crude oil July in NYMEX settled at $127.59 ($127.35), after trading in the range $125.22 - $129.35.



The latest weekly inventory report by US Energy Department’s Energy Information Administration had shown an 8.8 million barrel drop in the nation’s crude supplies to 311.6 million, in the week ended May 23.



But according to the EIA, the drop in crude inventories was due to temporary delays in unloading oil tankers along the Gulf Coast, and not the result of increased demand.



Potential supply threats due to geo-political tensions, expected demand from China and OPEC’s unwillingness to increase output despite high prices underpin oil prices.



Another attack on Nigerian oil facilities refocused concerns on immediate supplies. Production was partially disturbed after militants attacked a major oil pipeline owned by Royal Dutch Shell in the Niger Delta last week.



Last day DGCX Gold Aug traded in the range $885.00 – $901.10 and closed at $896.10 ($891.50).



Weekly Outlook (Spot gold)



Spot gold might get good support at $880. Resistances are $890, $903 and $914; supports $870, $859 and $848. Sustaining above $880 may lead to $914.



DGCX Gold August



TECHNICAL OUTLOOK (Intra-day)

GOLD (Aug) - Bullish above $ 894.70; bearish below $ 889.50

MCXARUN
9994500540

safe trade calls

GOLD

for the day buy only abv 12310 S/L 12285 and T/p 12340-385/towards 12450 OR sell below 12140 S/L 12165 and T/p 12085-60/12000/close below test 11900-11850 atleast in coming days (any time close above 12600/ 12875/13050/13330/13510 bullish while close below 12000/11775/11375/11200 bearish for medium term)


SILVER

For the day sell below 23150 S/L 23225 and T/p 23050-25/22875-900/close below 22875 test 22575 atleast/towards 22450 OR buy abv 23550 S/L 23500 and T/p 23650/23775 upto 23850 (any time close below 22750-300/21575-500/ 20400/19250/18775 bearish rally while close above 255500/26300/27700 bullish for medium term)


CRUDE


we book profit on sell below 5350, for the day sell below 5360 S/L 5385 and T/p 5320-5300/close below test 5190-210 atleast/towards 5140 in coming days OR sell ard 5570-80 S/L 5585 and T/p 5540-5490 (now crude need to close above 5690-5730/5825 for bullish rally while close below 5300/5120/5050/ 4740/4450 bearish for medium term)


COPPER

we book profit on sell below 333, for the day sell only below 331-330 S/L 332.25 and T/p 326.5-27/below down rally sharp OR buy abv 338.5 S/L 337 and T/p 339.75-341/342.5 upto 345.5 (upside strong rally only on close above 352.5/ 361.5 while close below 333/330-326.5/ 310 bearish for medium term)


MCXARUN
9994500540

bullion intraday

Bullion
03 June 2008 10:28:35



Bullion June 03 2008

Major Headlines:

Gold rose on speculation that investors may stock up on the metal after the biggest weekly drop in price since mid-March. Silver also gained, Gold, which declined 3.7 percent last week, will rise into the first quarter, according to forecasts by analysts compiled by Bloomberg.

ETF Securities Ltd., manager of about $5.7 billion of commodities, said investments in its industrial- metal products dropped 15 percent from the end of March as investors favored precious metals including gold and platinum. Nonferrous-metal assets fell to $172 million at the end of May, from $203 million on March 31, Nicholas Brooks, Assets in precious metals expanded 13 percent to $2.6 billion.

Hedge funds and other large speculators increased so-called net long positions, or bets on higher futures, 5.2 percent in the week ended May 27. It was the second straight gain, May 30 data from the U.S. Commodity Futures Trading Commission showed

Peru's output of most metals rose in April, while gold fell slightly, the Energy and Mines Ministry said late Sunday, Silver production reached 291,646 kilograms in April, an increase of 4.98% compared with April 2006. The ministry said gold output totaled 14,349 kilograms in April, down 0.46% Compared with the same month a year before and Peru is the world's largest producer of silver, and depending on annual production, is among the top five for zinc, copper and gold.

Gold output in Australia slowed sharply during the first quarter of this year, falling to the lowest quarterly level in 19 years because of lower average ore grades. And the Mexico silver production rose 12.6% year on year to 217 metric tons in March, while in April

The rate of gold de-hedging this year may reach the average annual rate it's reached since 2000 of 282 tons, but will likely tail off in subsequent years, the scheduled delivery program suggests further de-hedging of roughly 80 tons this year but anecdotal evidence already indicates that this will be increase


U.S.Economy:

The Institute of Supply Management's manufacturing index improved from 48.6 to 49.6 in May, better than expected, but still a sign of slight contraction.

The U.S. Census Bureau said that construction spending was at an annual rate of $1.1209 trillion in April, down .4% from March's pace and down 3.9% from a year ago. So far in 2008, construction spending is down 2.8% from a year ago


Currencies update:

Australia's Bureau of Statistics said that retail sales were down .2% in April, weaker than expected. The June Australian dollar is steady.

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 12118 If market breaches below 12118 may see prices to take further correction towards 11967 and 11873 However if it holds back above 12363 may see prices to rise further on today. Major resistance is seen at 12457 and 12608

Recommendations–MCX Gold June: Buy at 12210 Target 12270 and 12350 Stoploss at 12155

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 23118 If market breaches below 23168 may see prices to take further correction towards 22871 and 22690 However if it holds back above 23646 may see prices to rise further on today. Major resistance is seen at 23827 and 24124

Recommendations-MCX Silver July: Buy at 23290 Target 23520 and 23780 stoploss at 23120

MCXARUN
9994500540

GENERAL MARKET CONDITIONS

The first trading day of June was very positive for gold and silver unlike the month of May where bears had taken charge. Economic data risk this week is preventing traders from going too short on precious metals. Precious metals also benefited from safe haven demand after news of troubles at Bradford & Bingley, the UK’s largest buy-to-let mortgage lender raised concerns over the health of the UK economy. The company issued a stark warning on the state of the UK mortgage market and said profits in the first four months of the year had halved. The financial services sector is an important driver of UK growth. Global credit worries have once again come to haunt investors. Unless these kind of news die down, precious metals will find investment demand on dips.

Base metals should provide a good investment opportunity in the next fortnight. With every successive fall in zinc, then with lead and nickel the risk to return ratio moves in favour of the buyer. Copper is an every green investment. The key to investing in base metals is to exit the longs at the right time and reduce greed.

COPPER -- JULY FUTURE

200 day MA around $348 will result in copper finding buyers on dips. Resistance at $364.80 and $373.10.

NYMEX CRUDE OIL -- FUTURE

Intra day as long as $123.60 holds downside will be limited.


MCXARUN
9994500540