DAILY GOLD TREND FOR 22 NOV

Gold prices ended lower on the week after a stronger dollar put pressure on precious metals prices, but the markets managed to hold above key support levels which should give support into next week’s action.
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After being bloodied and bruised for several weeks, the dollar rallied a bit versus the euro this week over jitters regarding the solvency of Irish banks. The European Union, the International Monetary Fund and the United Kingdom all pledged to help the beleaguered banks, even as the Irish government attempted to fend off the aid.

Dollar strength weighed on precious metals and kept prices under $1,400 the entire week. “That doesn’t mean this market is bearish, not all, this market is still extremely bullish, but we’re in a correction with extreme volatility,”

The fact December gold was able to scratch out a close over $1,350 is a positive sign going into next week, said Bob Haberkorn, senior market strategist, Lind-Waldock, and gold could try to go back and retest the $1,400 area.

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Precious metals prices also sagged over worries of a Chinese interest rate hike. Early Friday, China said it would tell banks to raise their reserves, effective Nov. 29, but markets cut early losses. Haberkorn said early chatter that the CME Group, which owns the Comex, would raise margins again pulled down prices, but when that did not materialize the market shook off some of the losses.

He said going forward that the markets will continue to keep an eye on any political tensions between the U.S. and China, especially after Federal Reserve Chairman Ben Bernanke’s speech overnight that chastised an unnamed country for undervaluing its currency and potentially curbing global growth.

“The next thing we need to watch is the political and economic fight with China. If there are global concerns again, that could lift the dollar. But gold and silver might rally regardless of the dollar, much like it did this spring when the Europe (fiscal worries) happened,” Haberkorn said.

 

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I believe investors are still looking to China to see if they
intend to raise their Interest rates once again. The China
Central Bank unexpectedly raised their benchmark lending
rates 0.25 percentage rates on October 19,2010 for the first
time in three years. According to Chinese officials the rate was
raised as an attempt to curb the countries historic high prices
for commodities.(Slow their inflation)...Many analysts expect
China's Banks to raise their rates again.....

When Central Banks raise interest historically causes Gold and
Silver to tumble....However, if prices to drop I believe there will be
plenty of bullion buyers including Central banks looking to increase
their reserves.....China and South Korea have both expressed
interest in doing so......


MY COUNTS FOR 11/22
DECEMBER GOLD
RESISTANCE # 2..............$1374.00(MCX Rs 20219)
RESISTANCE # 1..............$1363.00(MCX Rs 20145)
PIVOT...............................$1352.00(MCX Rs 20031)
SUPPORT # 1....................$1341.00(MCX Rs 19959)
SUPPORT # 2....................$1330.00(MCX Rs 19843)

DECEMBER SILVER
RESISTANCE # 2............ $28.03(MCX Rs 42198)
RESISTANCE # 1.............$27.60(MCX Rs 41733)
PIVOT..............................$26.97(MCX Rs 40905)
SUPPORT # `1..................$26.55(MCX Rs 40440)
SUPPORT # 2...................$25.91(MCX Rs 39910)

RECOMMENDATION : WORK BETWEEN SUPP AND RESI

RAHUL KUMAR

GOLD Analysist

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