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Bullion Report
Feb 15 2007 10:43AM
15th Feb 2007 Bullion Report

GOLD
FUNDAMENTALS  
Gold futures rose to their highest levels since August of 2006, as a weakening US Dollar and large fund buying have sent prices soaring. In London spot market gold was offered $6 higher at $670.05 per troy ounce. Markets learnt about huge fund buying in Tokyo.

Citigroup metals analysts urged Barrick Gold to aggressively reduce or repurchase the entire hedge book.

US dollar continued to ease against major currencies of the world as Federal Reserve cut GDP growth prospect.

Comex warehouse stocks unchanged at 7,487,582 ounces.
TUG-OF-WAR: Bulls vs. Bears
No.
 Pressure Point
Favours
1.
 Huge fund buying in Tokyo and other markets. Bulls 
2.
 Barrick Gold urged to reduce hedge book. Bulls 
3.
 US dollar eases against major currencies. Bulls 
4.
 Comex warehouse stocks remain unchanged. Bears


EVENT WATCH: (Monday)
Japan Oct-Dec GDP
Hong Kong Nov-Jan unemployment
Taiwan Q4 GDP
Singapore Dec retail sales
US Feb Empire State manufacturing survey, Jan imports/exports, industrial production and capacity utilization, Feb Philadelphia Fed survey
 
TECHNICALS
Gold is showing tentativeness at higher levels as depicted by the long upper shadow of the candlestick. However, close above the short term EMAs suggests firmness in the market. Rising MACD in positive zone indicate increasing bullish momentum. Stochastic has however made bearish crossover in overbought region, which warrants some caution to bulls.
   
TRADE RECOMMENDATION
 
Contract
Call
Entry
T1
T2
SL
S2
S1
PCP
R1
R2
MCX-April
Buy
>9575
9610
9635
9550
9488
9538
9575
9636
9660





SILVER
FUNDAMENTALS  
Silver prices vaulted above the psychologically mark of $14 helped by strong fund buying. In London spot market silver quoted 20 cents higher at $14.07 per troy ounce.

Copper prices remained upbeat due to the drop in inventory level and softer dollar. However, the decline in oil prices and Fed cutting GDP forecast is likely to dampen the sentiments.

Comex warehouse stocks remain unchanged at 115,437,975 ounces.

TUG-OF-WAR: Bulls vs. Bears
No.
 Pressure Point
Favours
1.
 Silver advance further on fund activity. Bulls
2.
 Copper and other base metal prices. Bulls
3.
 Comex warehouse stocks remain unchanged. Bears


EVENT WATCH:
Events covered under gold section
 
TECHNICALS
Silver is also showing reluctance at higher levels. The prices closed above EMAs suggest that the firmness is intact. Rising MACD in the positive zone also shows increasing bullish momentum. However, stochastic is negative in neutral region. The prices are likely to show volatility with positive bias.
   
TRADE RECOMMENDATION
 
Contract
Call
Entry
T1
T2
SL
S2
S1
PCP
R1
R2
MCX-Mar
Buy
> 20300
20400
20500
20240
20012
20142
20302
20508
20616
 
DISCLAIMER
This report is prepared exclusively for Reliance Commodities by Indian Rural Market Products Pvt Ltd (IRMPL). The information and opinions contained in the document have been compiled from sources believed to be reliable. IRMPL does not warrant its accuracy, completeness and correctness. Use of data and information contained in this report is at your own risk. This document is not, and should not be construed as, an offer to sell or solicitation to buy any commodities. IRMPL and its affiliates and/or their officers, directors and employees may have positions in any commodities mentioned in this document (or in any related investment) and may from time to time add to or dispose of any such commodities (or investment).

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Equities: Trading through Reliance Securities Limited | NSE SEBI Registration Number Capital Market :- INB 231234833 | BSE SEBI
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