BULLIONS WEEKLY REPORT -30 DEC 2013–04 JAN 2014

                                                      MARKET REPORT

GOLD 

Gold closed the week in the green adding 15.00 to end at 1212.70 on bargain 

hunting and market boredom. There was little action this week and volumes were 

extremely low due to the holiday which allowed gold to react strongly to the 

buying surge by bargain hunters. Gold futures ended modestly higher on Friday 

after fluctuating for much of the session, after the dollar weakened against a 

basket of major currencies on low volumes due to Christmas holidays. For the 

week, gold gained about 0.9%. In economic news, initial jobless claims for 

unemployment benefits in the U.S. declined sharply for the week ended 

December 21. Initial jobless claims tumbled to 338,000, a decrease of 42,000 from 

the previous week’s revised figure of 380,000. Economists expected claims to 

drop to 340,000 from the 379,000 originally reported for the previous week. In 

economic news elsewhere, profit earned by Chinese industrial firms rose 9.7% in 

November, compared to the 15.1% annual rise witnessed in the previous month, 

the National Bureau of Statistics reported. Bullion has fallen more than 25% 

this year, hurt partly by the long-expected tapering of the US Federal Reserve’s 

bond-buying stimulus program, which has been a key driver of gold’s rally in 

recent years. Premiums for gold bars inched up to a high of $2 an ounce above 

spot London prices in Hong Kong, higher than $1.50 last week on some tightness 

at the end of the year as dealers awaited the arrival of fresh supply from Europe 

next month. 

 

SILVER 

Silver ended the week on a strong note moving back over the $20 price level to 

close at 20.068 as economic data supported increased demand on the industrial 

side and a slightly higher interest in precious metals. From a momentum and 

performance point-of-view, silver found a cycle low this past summer. From a 

relative performance perspective, silver has been outperforming gold since late 

July. This impressions us to believe the low inflation backdrop is shifting discretely 

beneath the markets as gold and silver have tested the panic lows from early 

summer and look poised for reversal into 2014. 

CRUDE OIL 

Crude Oil ended the week above the $100 price level after the delayed holiday EIA 

inventory showed a larger drop in supplies that expected. The price of oil got a 

boost from a drop in applications for unemployment benefits, the latest sign of 

recovery in the U.S. job market, and expectations of a decline in U.S. crude 

stockpiles. Optimism about the U.S. economic recovery lifted expectations for the 

country’s energy demand. A report from the Energy Department’s Energy 

Information Administration released Friday showed that U.S. crude stockpiles fell 

4.7 million barrels last week to 367.6 million barrels. Brent Oil on the other hand 

ended the week on a strong note at 112.050 after geopolitical issues pushed 

traders stress levels upward. Civil war is about to break out in Sudan and Libya has 

been unable to turn away protestors at the ports who are stopping oil exports. 

Market analysts attributed the rise in crude oil futures to a firming trend in Asia 

on supply concerns following escalating violence in oil-producer South Sudan, but 

gains were capped as dealers sat on the sidelines awaiting fresh leads after the 

holidays. 

 

NATURAL GAS 

Natural Gas tumbled at the end of the week giving up almost 20 cents for the 

week after touching a high of 4.577 on Monday as cold weather blanketed the US. 

With the holiday in the middle of the week traders continued to push prices up 

hoping that the weekly EIA inventory would show a drop in stocks. Natural gas 

declined Friday as traders shifted their focus from an as-expected government 

storage report to forecasts for moderate temperatures next week, which could 

reduce demand for the heating fuel. Natural gas inventories fell by 177 billion 

cubic feet in the week ended Dec. 20, the Energy Information Administration said 

Friday. Analysts and traders had expected a 178-bcf draw, according to a Wall 

Street Journal survey. Demand for natural gas has been substantial due to 

widespread colder-than-average temperatures, which have boosted demand for 

indoor heating. About half of U.S. households use natural gas as their primary 

heating fuel, according to the EIA. While the number was stronger than average 

for this time of year, it was a significant reduction from the prior week’s 

drawdown of 285 bcf, which was the biggest on record. 

COPPER 

Copper ended a rocky week at 3.38 much higher than its usual trading range 

around the 3.32 level. An erroneous trade before the holiday sent the currency 

soaring above the 3.42 price level and has left traders in a quandary as technical 

buying and selling kicked off as the prices rose. Meanwhile, China’s industrial 

output is likely to grow by about 9.8% in 2013, the Ministry of Industry and 

Information Technology said. Copper prices rose to their highest in more than 

four months on Friday, lifted by tightening supplies and expectations that 

economic recovery in top consumer China will help boost demand for industrial 

metals next year. Copper prices are on track to rise almost 5% in December, their 

biggest monthly gain since September last year, but are still 7 % lower in the year 

to date. China’s economic growth is likely to come in at 7.6% this year, according 

to a cabinet report cited by the official Xinhua news agency, just above the 

government’s target of 7.5% and slightly below last year’s 7.7%. 

COMMODITY PICK OF THE WEEK: CRUDE OIL 

MCX Crude Oil January as seen in the weekly chart above has opened the week at 6175 

levels initially moved sharply higher as it crossed crucial resistance level of 6180. Later 

prices rallied sharply and finally closed sharply higher from the previous week closing 

level 6247. 

For the next week, Crude Oil prices to find support in the range of 6180-6160 levels & 

finally towards the strong support at 6120-6080 levels. Resistance is observed in the 

range of 6335-6358 levels & then finally towards the strong resistance at 6390 levels. 

WEEKLY RECOMMENDATION: BUY CRUDE OIL JANUARY MCX ABOVE 6250 FOR 

TARGET OF 6400 TO 6425 WITH SL OF 6160.