MARKET REPORT


Gold is trading at 1230.70 gaining just over $5.80 today as traders tried to decide what to expect next week. Markets are focused on the Federal Reserve’s monetary policy and the possibility of tapering as soon as next week. Gold rose slightly on Friday after a sharp plunge the previous day attracted some buyers, but gains were limited by rising expectations of an early end to U.S. monetary stimulus after a slew of upbeat data. Stronger-than-expected U.S. retail numbers data on Thursday, adding to last week’s forecast-beating jobs report, have strengthened speculation the Federal Reserve could start winding down its bond purchases at its Dec. 17-18 meeting, although the market consensus is still for
March. Some lost faith in the metal as a store of value as inflation failed to accelerate, while equities and the dollar rallied. Hedge funds and other money managers reduced their bets on price gains for five straight weeks and are the least-bullish since June 2007, U.S. Commodity Futures Trading Commission data showed. The Fed’s massive bond-buying program has supported bullion by keeping interest rates low and stoking inflation fears by flooding the markets with cheap dollars. The metal is headed for its first annual decline in 13 years as investors, buoyed by a recovering global economy, pull money from gold and channel it into riskier assets such as equities. News that a U.S. budget deal that would avoid a government shutdown in January had sailed through the House of Representatives overnight lifted the dollar to a five-year high against the yen. A stronger dollar is negative for gold as it makes the metal more expensive to holders of other currencies.


Silver recovered 42 points to trade at 19.495. The US dollar continued to gain moving up to 80.28. Copper eased on Friday after five sessions of gains as the dollar rose and caution prevailed ahead of a U.S. Federal Reserve meeting next week. Weighing on metals prices was a rise in the dollar against a basket of currencies, following upbeat U.S. retail sales data and the smooth passage through the U.S. House of Representatives of a budget deal to avoid a government shutdown. A strong dollar makes commodities priced in the U.S. unit more expensive for holders of other currencies. The focus next week is likely to be on a Fed policy meeting on Dec. 17-18 for any indications of when the central 
bank might begin reining in its massive monetary stimulus program. 


Crude Oil gave up 49 cents to trade just a penny above the $97 price level while Brent Oil eased by 32 points to close the week near 108.35. The spread is now only $11.35. The prospects for a stronger dollar have in turn hit metals and oil, by making them more expensive for buyers outside the United States. Oil prices slid on Friday as dealers fretted over a global oversupply in crude, while speculation 
the US Federal Reserve will soon scale back its stimulus programme also weighed. Investors are not only concerned about an oversupply in the US from shale oil, but also from OPEC member countries like Iraq which have pledged to increase supply even if prices fall significantly. 


Natural gas futures climbed to their highest price in nearly two and a half years, Thursday, after a government storage report showed a supply decline last week that was greater than normal for this time of year. Meanwhile, weather forecasts continue to project more frigid temperatures later this month. Natural gas for January delivery settled 7.2 cents higher, or 1.7%, to $4.409 a million British 
thermal units on the New York Mercantile Exchange. Prices rose to their highest level since July 20, 2011 and have gained 27% since in Nov 5. Recently, Natural gas is trading near day low 4.346. Natural gas creates on 2 year historical chart a format of inverted head and shoulder as a reversal in a down trend it indicated that natural gas bullish trend will continue on near main support 4.308. Natural 
gas may hit 4.270 and 4.233 in short term with profit booking. 


Copper has been forming higher highs and higher lows since the beginning of December on the one hour chart. However, the uptrend line and the return line are converging, raising the possibility of a rising wedge formation. A rising wedge has bearish implications most of the time. This would be confirmed by a dip below the trend line and a break below the support at 3.2787 (S1). On the other hand, if the longs overcome the previous high of 3.3092 (R2). The MACD oscillator seems ready to cross above its signal line, while the RSI is following a downward path. At the moment, the uptrend is valid. 


MCX Natural Gas December as seen in the weekly chart above has opened the week at 254.30 levels initially moved sharply higher as it crossed crucial resistance level of 265 Later prices rallied sharply breaking the resistance of 265 & moved towards 276.70 levels and finally closed sharply higher from the previous week closing levels. For the next week, Natural Gas prices to find support in the range of 265-268 levels & finally towards the strong support at 255-258 levels. Resistance is observed in the range of 281-285 levels & then finally towards the strong resistance at 291 levels. 

OF 285 TO 290 WITH SL OF 265- 263.


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