gold
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 over bought level, which is bearish and should support lower prices. The market's short-term trend is negative as the close remains below the 18-day moving average. The upside closing price reversal on the daily chart is somewhat positive.
Recommendations:
MCX Gold Feb: Sell blow 10180 for the target of 10140 and 10120 with stop loss at 10222
silver
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 over bought level, which is bearish and should support lower prices. The market's short-term trend is negative as the close remains below the 18-day moving average. The upside closing price reversal on the daily chart is somewhat positive.
Recommendations:
MCX Silver March: Sell at 18550-560 for the target of 18415 and 18355 with stop loss at 18652
Monday, December 17, 2007
Bullion
Gold fell to a one-week low as a rally in the dollar eroded the appeal of the precious metal as an alternative investment. Silver also declined.
The dollar rose the most against the euro since May 2005 after reports showing higher consumer prices fueled speculation the Federal Reserve will keep interest rates steady. Gold generally moves in the opposite direction of the U.S. currency. The metal has gained 25 percent this year as the dollar dropped 8.5 percent against the euro.
The dollar has climbed against 13 of the 16 most-actively traded currencies today as speculation grew that the Fed would be less likely to cut interest rates in the face of accelerating inflation.
The consumer price index rose 0.8 percent in November, the most in more than two years, the Labor Department said today. Wholesale prices rose 3.2 percent last month, the biggest jump in 34 years, the agency said yesterday.
The Fed has lowered the overnight lending rate 1 percentage point to 4.25 percent this year. Lower rates have bolstered gold and hurt the dollar, sending the U.S. currency to $1.4967 against the euro on Nov. 23, the lowest ever. The dollar traded as high as $1.4412 today. Gold reached $848 on Nov. 7, the highest since January 1980.
The dollar rose the most against the euro since May 2005 after reports showing higher consumer prices fueled speculation the Federal Reserve will keep interest rates steady. Gold generally moves in the opposite direction of the U.S. currency. The metal has gained 25 percent this year as the dollar dropped 8.5 percent against the euro.
The dollar has climbed against 13 of the 16 most-actively traded currencies today as speculation grew that the Fed would be less likely to cut interest rates in the face of accelerating inflation.
The consumer price index rose 0.8 percent in November, the most in more than two years, the Labor Department said today. Wholesale prices rose 3.2 percent last month, the biggest jump in 34 years, the agency said yesterday.
The Fed has lowered the overnight lending rate 1 percentage point to 4.25 percent this year. Lower rates have bolstered gold and hurt the dollar, sending the U.S. currency to $1.4967 against the euro on Nov. 23, the lowest ever. The dollar traded as high as $1.4412 today. Gold reached $848 on Nov. 7, the highest since January 1980.
LONG VIEW
CRUDE OIL
LIKELY TO TEST 3350-3300 UPTO 3260 WITH ANY CLOSE BELOW 3430-3400 WHILE CLOSE ABOVE 3715/3875-3900 UPTREND AGAIN(JAN)
LIKELY TO TEST 3350-3300 UPTO 3260 WITH ANY CLOSE BELOW 3430-3400 WHILE CLOSE ABOVE 3715/3875-3900 UPTREND AGAIN(JAN)
OUT LOOK
February gold closed lower on Friday extending Thursday's decline below the 10-day moving average crossing at 806.40. The
low-range close sets the stage for a steady to lower opening on Monday. Stochastics and the RSI are turning bearish signaling
that sideways to lower prices are possible near-term. If February extends this week's decline, November's low crossing at
780.40 is the next downside target. Closes above Wednesday's high crossing at 822.80 would renew the rally off November's
low. From a broad perspective, February gold needs to close above 855.00 or below 780.40 to confirm a breakout of the late-
fall trading range and point the direction of the next trending move. First resistance is Wednesday's high crossing at 822.80 then
the reaction high crossing at 844.20. First support is last Thursday's low crossing at 790.90 then last Monday's low crossing at
783.00.
March silver closed lower on Friday and spiked below the previous reaction low crossing at 13.960 as it extends this week's
decline. The low-range close sets the stage for a steady to lower opening on Monday. Stochastics and the RSI are turning
bearish signaling that sideways to lower prices are possible near-term. Closes below the reaction low crossing at 13.960 would
renew the decline off November's low opening the door for a possible test of October's low crossing at 13.360 later this winter.
First resistance is the 20-day moving average crossing at 14.558 then Tuesday's high crossing at 14.975. First support is
today's low crossing at 13.870 then October's low crossing at 13.360.
January crude oil closed lower on Friday as it consolidated some of Wednesday's rally. The low-range close sets the stage for a
steady to lower opening on Monday. Stochastics and the RSI remain bullish signaling that sideways to higher prices are possible
near-term. If January renews this week's rally, the reaction high crossing at .9768 is the next upside target. Closes below the 10-
day moving average crossing at 89.67 would temper the near-term friendly outlook in the market. A close below last week's low
crossing at .8582 would renew the decline off November's high. First resistance is Thursday's high crossing at 94.85. Second
resistance is the reaction high crossing at 97.68. First support is today's low crossing at 90.60 then the 10-day moving average
crossing at .8994.
January Henry natural gas closed lower on Friday and below the 10-day moving average crossing at 7.178 signaling that a
short-term top has likely been posted. The low-range close sets the stage for a steady to lower opening on Monday. Stochastics
and the RSI are turning neutral signaling that sideways to lower prices are possible near-term. If January renews the decline off
November's high, weekly support crossing at 6.801 is the next downside target. Closes above the 20-day moving average
crossing at 7.477 are needed to confirm that a short-term low has been posted. First resistance is today's high crossing at 7.207
then the 20-day moving average crossing at 7.477. First support is Today's low crossing at 7.000 then Monday's low crossing
at 6.950.
low-range close sets the stage for a steady to lower opening on Monday. Stochastics and the RSI are turning bearish signaling
that sideways to lower prices are possible near-term. If February extends this week's decline, November's low crossing at
780.40 is the next downside target. Closes above Wednesday's high crossing at 822.80 would renew the rally off November's
low. From a broad perspective, February gold needs to close above 855.00 or below 780.40 to confirm a breakout of the late-
fall trading range and point the direction of the next trending move. First resistance is Wednesday's high crossing at 822.80 then
the reaction high crossing at 844.20. First support is last Thursday's low crossing at 790.90 then last Monday's low crossing at
783.00.
March silver closed lower on Friday and spiked below the previous reaction low crossing at 13.960 as it extends this week's
decline. The low-range close sets the stage for a steady to lower opening on Monday. Stochastics and the RSI are turning
bearish signaling that sideways to lower prices are possible near-term. Closes below the reaction low crossing at 13.960 would
renew the decline off November's low opening the door for a possible test of October's low crossing at 13.360 later this winter.
First resistance is the 20-day moving average crossing at 14.558 then Tuesday's high crossing at 14.975. First support is
today's low crossing at 13.870 then October's low crossing at 13.360.
January crude oil closed lower on Friday as it consolidated some of Wednesday's rally. The low-range close sets the stage for a
steady to lower opening on Monday. Stochastics and the RSI remain bullish signaling that sideways to higher prices are possible
near-term. If January renews this week's rally, the reaction high crossing at .9768 is the next upside target. Closes below the 10-
day moving average crossing at 89.67 would temper the near-term friendly outlook in the market. A close below last week's low
crossing at .8582 would renew the decline off November's high. First resistance is Thursday's high crossing at 94.85. Second
resistance is the reaction high crossing at 97.68. First support is today's low crossing at 90.60 then the 10-day moving average
crossing at .8994.
January Henry natural gas closed lower on Friday and below the 10-day moving average crossing at 7.178 signaling that a
short-term top has likely been posted. The low-range close sets the stage for a steady to lower opening on Monday. Stochastics
and the RSI are turning neutral signaling that sideways to lower prices are possible near-term. If January renews the decline off
November's high, weekly support crossing at 6.801 is the next downside target. Closes above the 20-day moving average
crossing at 7.477 are needed to confirm that a short-term low has been posted. First resistance is today's high crossing at 7.207
then the 20-day moving average crossing at 7.477. First support is Today's low crossing at 7.000 then Monday's low crossing
at 6.950.
GENERAL MARKET CONDITIONS
Three things which so far has yet to happen in 2007, gold has yet to break $850, crude oil has yet to break $100 and euro/usd has yet to break 1.50. Gold and crude oil still have a chance to edge past these markets despite technical bearishness, while euro/usd over 1.50 in the next two weeks is highly unlikely. As far as metals markets are concerned, it is base metals which will be remembered than precious metals as they created historical highs in 2007 only to crash subsequently. It started off with copper, followed by nickel, zinc and lead. Fundamentally, I have never been a base metal bull and my reasoning is that if global growth is to slow down in 2008.
A slowdown in 2008 is getting factored in for base metal prices and when liquidity conditions improve (probably after the first fortnight of January, 2008) base metals will find buying interest. At the moment, in our view there are still huge longs in copper, zinc and lead at higher levels and retail investors are trying to average and get out of their investment in base metals. Once this is over, base metals will consolidate. Please remember that base metals are still way high over 2004 lows. So base metals are still in their multi-year bull cycle. Interest rate cuts by various central banks globally in the second half of 2008 should support base metals. US economy will grow very strongly in the second half of 2008 on lagging effects of interest rate cuts and a weaker currency while the European central bank should start their interest rate cuts after June 2008. Even the Indian central bank should cut interest rates by half a percent in 2008 as inflation falls below acceptable levels.
The volatility in the first fortnight of December, is just preparing traders for things to come in 2008. Day traders are having hell of time as higher volatility means more trading opportunities. Technically gold and silver are in a neutral to bearish zone while crude oil is in a neutral zone. Euro/usd has to break 1.4674 to be in bullish zone while failure to edge past this week will result in fall to 1.41. This is last trading week Christmas and trading volumes will fall from next week as some traders jet off for vacations.
GOLD -- FEBRURAY FUTURE
Double bottom has been formed at $776 and a double top at $818. Gold will trade in wider $790-$814 range for the day. A breakout is in the offing from the current trading range soon
NYMEX CRUDE OIL -- FUTURE
As long as crude oil holds $90-$90.40 downside will be limited and it will target $94-$95.50 once again. Falls below $90 then $87.40 is the target. Investor should sell April/May futures on rise with a price target of $78.
A slowdown in 2008 is getting factored in for base metal prices and when liquidity conditions improve (probably after the first fortnight of January, 2008) base metals will find buying interest. At the moment, in our view there are still huge longs in copper, zinc and lead at higher levels and retail investors are trying to average and get out of their investment in base metals. Once this is over, base metals will consolidate. Please remember that base metals are still way high over 2004 lows. So base metals are still in their multi-year bull cycle. Interest rate cuts by various central banks globally in the second half of 2008 should support base metals. US economy will grow very strongly in the second half of 2008 on lagging effects of interest rate cuts and a weaker currency while the European central bank should start their interest rate cuts after June 2008. Even the Indian central bank should cut interest rates by half a percent in 2008 as inflation falls below acceptable levels.
The volatility in the first fortnight of December, is just preparing traders for things to come in 2008. Day traders are having hell of time as higher volatility means more trading opportunities. Technically gold and silver are in a neutral to bearish zone while crude oil is in a neutral zone. Euro/usd has to break 1.4674 to be in bullish zone while failure to edge past this week will result in fall to 1.41. This is last trading week Christmas and trading volumes will fall from next week as some traders jet off for vacations.
GOLD -- FEBRURAY FUTURE
Double bottom has been formed at $776 and a double top at $818. Gold will trade in wider $790-$814 range for the day. A breakout is in the offing from the current trading range soon
NYMEX CRUDE OIL -- FUTURE
As long as crude oil holds $90-$90.40 downside will be limited and it will target $94-$95.50 once again. Falls below $90 then $87.40 is the target. Investor should sell April/May futures on rise with a price target of $78.
Friday, December 14, 2007
outlook
February gold closed sharply lower on Thursday and below the 10-day moving average crossing at 805.40 tempering the near-
term friendly outlook in the market. The low-range close sets the stage for a steady to lower opening on Friday. Stochastics and
the RSI remain bullish signaling that sideways to higher prices are possible near-term. If February extends this week's rally, the
reaction high crossing at 844.20 is the next upside target. Closes below November's low crossing at 780.40 would renew the
decline off last month's high while opening the door for a larger-degree decline into the end of the year. First resistance is
Wednesday's high crossing at 822.80 then the reaction high crossing at 844.20. First support is last Thursday's low crossing at
790.90 then last Monday's low crossing at 783.00.
March silver closed sharply lower on Thursday and below the 10-day moving average crossing at 14.521 signaling that a short-
term top has been posted. The low-range close sets the stage for a steady to lower opening on Friday. Stochastics and the RSI
are turning neutral hinting that sideways to lower prices are possible near-term. If March extends today's decline, the reaction
low crossing at 13.960 is the next downside target. Closes below this support level would renew the decline off November's low
thereby opening the door for a larger-degree decline this winter. First resistance is Tuesday's high crossing at 14.975 then the
reaction high crossing at 15.220. First support is today's low crossing at 14.100 then this month's low crossing at 13.960.
January crude oil closed lower on Thursday as it consolidated some of Wednesday's rally. The low-range close sets the stage for
a steady to lower opening on Friday. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible
near-term. If January extends this week's rally, the reaction high crossing at .9768 is the next upside target. Closes below the
10-day moving average crossing at 89.67 would temper the near-term friendly outlook in the market. A close below last week's
low crossing at .8582 would renew the decline off November's high. First resistance is today's high crossing at 94.85. Second
resistance is the reaction high crossing at 97.68. First support is today's low crossing at 91.85 then the 10-day moving average
crossing at .8967.
January Henry natural gas closed lower on Thursday as it consolidated some of Wednesday's rally but remains above the 10-
day moving average crossing at 7.209. The low-range close sets the stage for a steady to lower opening on Friday. Stochastics
and the RSI are turning bullish signaling that sideways to higher prices are possible near-term. Closes above the 20-day moving
average crossing at 7.545 are needed to confirm that a short-term low has been posted. If January renews the decline off
November's high, weekly support crossing at 6.801 is the next downside target. First resistance is today's high crossing at
7.529 then the 20-day moving average crossing at 7.545. First support is Monday's low crossing at 6.950 then weekly support
crossing at 6.801.
term friendly outlook in the market. The low-range close sets the stage for a steady to lower opening on Friday. Stochastics and
the RSI remain bullish signaling that sideways to higher prices are possible near-term. If February extends this week's rally, the
reaction high crossing at 844.20 is the next upside target. Closes below November's low crossing at 780.40 would renew the
decline off last month's high while opening the door for a larger-degree decline into the end of the year. First resistance is
Wednesday's high crossing at 822.80 then the reaction high crossing at 844.20. First support is last Thursday's low crossing at
790.90 then last Monday's low crossing at 783.00.
March silver closed sharply lower on Thursday and below the 10-day moving average crossing at 14.521 signaling that a short-
term top has been posted. The low-range close sets the stage for a steady to lower opening on Friday. Stochastics and the RSI
are turning neutral hinting that sideways to lower prices are possible near-term. If March extends today's decline, the reaction
low crossing at 13.960 is the next downside target. Closes below this support level would renew the decline off November's low
thereby opening the door for a larger-degree decline this winter. First resistance is Tuesday's high crossing at 14.975 then the
reaction high crossing at 15.220. First support is today's low crossing at 14.100 then this month's low crossing at 13.960.
January crude oil closed lower on Thursday as it consolidated some of Wednesday's rally. The low-range close sets the stage for
a steady to lower opening on Friday. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible
near-term. If January extends this week's rally, the reaction high crossing at .9768 is the next upside target. Closes below the
10-day moving average crossing at 89.67 would temper the near-term friendly outlook in the market. A close below last week's
low crossing at .8582 would renew the decline off November's high. First resistance is today's high crossing at 94.85. Second
resistance is the reaction high crossing at 97.68. First support is today's low crossing at 91.85 then the 10-day moving average
crossing at .8967.
January Henry natural gas closed lower on Thursday as it consolidated some of Wednesday's rally but remains above the 10-
day moving average crossing at 7.209. The low-range close sets the stage for a steady to lower opening on Friday. Stochastics
and the RSI are turning bullish signaling that sideways to higher prices are possible near-term. Closes above the 20-day moving
average crossing at 7.545 are needed to confirm that a short-term low has been posted. If January renews the decline off
November's high, weekly support crossing at 6.801 is the next downside target. First resistance is today's high crossing at
7.529 then the 20-day moving average crossing at 7.545. First support is Monday's low crossing at 6.950 then weekly support
crossing at 6.801.
intraday 14/12/07
GOLD
for the day sell only below 10160-150 S/L 10190 and T/p 10090-100 upto 10025-35/ sustain below 9950 bearish rally OR sell ard 10340-50 S/L 10360 and T/p 10300-272/10225 (any time close above 10430/10700-770 bullish while close below 10025/9950/9750/9420/9025 bearish for medium term)
SILVER
for the day sell only below 18650 & more below 18550 S/L 18775 and T/p 18400-300 days to come OR sell ard 18290-310 S/L 18350 and T/p 18175/18050 (any time close below 18550/18300/18100/17750/ 17050/16450 bearish rally while close above 19550/19975/20425/21325/23150 bullish for medium term)
CRUDE
for the day sell below 3615 S/L 3635 and T/p 3585-90/3540 OR sell ard 3710-20 S/L 3725 and T/p 3575-3640 (now crude need to close above 3735-80/ 3850/3915 for bullish while close below 3500/3400/3320/3190/3030 bearish for medium term)
COPPER
for the day sell only below 258 S/L 260.5 and T/p 255-54/252/bearish rally OR sell ard 268-269 S/L 269.5 and T/p 265.5-263.5 (upside strong rally only on close above 276/282/293/299/314/321.5/327/ 331.5/348 while close below 258/250/ 235 bearish for medium term)
for the day sell only below 10160-150 S/L 10190 and T/p 10090-100 upto 10025-35/ sustain below 9950 bearish rally OR sell ard 10340-50 S/L 10360 and T/p 10300-272/10225 (any time close above 10430/10700-770 bullish while close below 10025/9950/9750/9420/9025 bearish for medium term)
SILVER
for the day sell only below 18650 & more below 18550 S/L 18775 and T/p 18400-300 days to come OR sell ard 18290-310 S/L 18350 and T/p 18175/18050 (any time close below 18550/18300/18100/17750/ 17050/16450 bearish rally while close above 19550/19975/20425/21325/23150 bullish for medium term)
CRUDE
for the day sell below 3615 S/L 3635 and T/p 3585-90/3540 OR sell ard 3710-20 S/L 3725 and T/p 3575-3640 (now crude need to close above 3735-80/ 3850/3915 for bullish while close below 3500/3400/3320/3190/3030 bearish for medium term)
COPPER
for the day sell only below 258 S/L 260.5 and T/p 255-54/252/bearish rally OR sell ard 268-269 S/L 269.5 and T/p 265.5-263.5 (upside strong rally only on close above 276/282/293/299/314/321.5/327/ 331.5/348 while close below 258/250/ 235 bearish for medium term)
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