safe trade calls

GOLD

THIS WAS OUR WORDS "sustain below 11775 towards 11700-630/ below sharp rally" ACHIEVED SEE DAYS LOW=11305 book profit on sell below 12000/11800, for the day sell below 11300 & more below 11275 S/L 11320 and T/p 11220/towards 11125... sustain close below 11275 & 11200 seen towards 11000 in coming days OR sell ard 11615-20 S/L 11630 and T/p 11550-500 (any time close above 11950/12680/12950/13550/13850 bullish while close below 11275-200 bearish for medium term)


SILVER

THIS WAS OUR WORDS YESTERDAY "sustain below 21400 towards 20950/ sharp down rally" ACHIEVED AS DAYS LOW=20714 book profit on sell below 23075/22700/21575, for the day sell below 20700 S/L 20800 and T/p 20600/500/400/Max towards 20100 in coming days OR sell ard 21160-70 S/L 21200 and T/p 20975-900/upto 20775 (any time close below 20700/19150-19000 bearish rally while close above 22850/25000/ 26100/27250/28000 bullish for medium term)


CRUDE

PRICE TURN EXACT FROM OUR GIVEN LEVEL ON BOTH SIDES book profit on sell below 4825, for the day sell below 4740 S/L 4765 and T/p 4725-4670/upto 4615 OR sell ard 4915-20 S/L 4925 and T/p 4870-4840 (now crude need to close above 5130/5450/5680/ 6040/6360 for bullish rally while close below 4745/ 4670/4385 bearish for medium term)


COPPER

book profit on sell below 334/322/317.5/ 307.75, for the day sell below 305.5 S/L 306.75 and T/p 304/302.5/300/298 OR sell ard 312.2-312.5 S/L 313 and T/p 310-308 (upside strong rally only on close above 324.5/336.5/351/360.5/ 371/387.5/398 while close below 305.5/ 302.5/289/265/251.5/235 bearish for medium term)


MCXARUN
9994500540

long view

SPOT GOLD INTERNATIONAL
LIKELY TO TEST $ 800/ $ 770-60 TOWARDS $740 WITH ANY BREAK & CLOSE BELOW $ 817... ONLY CLOSE ABOVE $ 935/976 & $ 988 BULLISH RALLY AGAIN


NICKEL
LIKELY TO TEST 710-700 WITH ANY BREAK & CLOSE BELOW 735, ONLY CLOSE ABOVE 806/825 SOME UPSIDE AGAIN(AUG)


MCXARUN
9994500540

GENERAL MARKET CONDITIONS

All I can say is that US dollar gains are pain for precious metals and energies. Highly oversold conditions exist in gold, silver and crude oil. Growth rates in other countries are now slowing down. This is the lagging effect of higher energy prices and a US slowdown. The focus of these central banks has switched from managing inflation to growth and some of them may cut interest rates this year. This has resulted in growth differentials between US and other nations getting narrowed and gains in the US dollar.

IS THE SUPER CYCLE IN COMMODITIES OVER

My answer is “No”. Commodities have more to go and the current fall in commodity prices is a part and parcel of a long term bull run. Long term bull runs are accompanied by sharp slides as well. Fundamentals for commodities have not changed. Global population continues to rise with the passing of each day. There are more mouths to feed every second. Urbanisation is getting faster which means forest cover being reduced to accommodate agriculture. This further accentuates global warming and crop failures. Add to this the increase in acreage under bio fuels. This cycle will continue unless global population stabilizes or reduces.

Do not expect global growth over five percent endlessly. Coordinated central bank effort to ensure higher growth rates and their protection policy of supporting failed/busted banks/financial institutions cannot last long. Now every major banks/financial institution knows that if they get busted their central bank is there to protect them. Once the central bank protection policy fails another super cycle in commodities will start which will end only with proctecionism.

A long run bull run does not mean over twenty percent gains in less than six months as we have seen in the first half of 2008. It’s all about the pace of rise for any instrument. If the pace of rise is very high then the pace of fall will be double. Further if any commodity gains backed without any rise in physical demand then the crash will be imminent sooner than later. This is what has happened with crude oil and other commodities.

Before I end, commodities does not mean just precious metals or energies. Commodities include precious metals, base metals, energies and soft commodities. If China starts to slowdown then base metals (including steel) will be the first to get ripped apart and producers will be forced to reduce production. Soft commodities long term story is here. But for the rest namely precious metals, base metals and energies with the long term bull run there will be phases of short term bear runs as well.

WHAT NEXT

In the short term commodities will remain under pressure as long the US dollar continues to gain. But after a certain period there will be a delinking between commodities and the US dollar. The next bull run in commodities will be accompanied by increase in physical prices (instead of just future prices) and the pace of rise will be slow and sustained. Unless gold falls below $680 and silver below $9.50 and crude oil below $80 the long term bull run will be intact.


MCXARUN
9994500540