Posted By : Kishore B.S
Hi Friends !!!!!
Please watchout for Precious Metal Outlook as below:
Now with the correction that has set in this commodity which has been tremendous and huge in the last 2 months some amount of skepticism has been created in the minds of investors and traders alike.
As envisaged in the last week the correction was expected to the support levels of 28600 and below that the 28100 and GAP of 27700 LEVELS. Similar to the Indian stock markets the Precious Metal is also undergoing a correction or Profit booking phase, which has been dragging the commodity lower. Given the chart patterns it looks like the commodity is likely to finish the correction phase soon near the 27700-28000 levels for the time being and some value buying could pull the same up.
The view of going long would hold as long as the commodity maintains the 27700 mark level to the extent of 28400-28600 levels for the time being which needs to be watched out for. Also the Euro Turmoil could fuel shift to safe investments in the form of GOLD coupled with likely Easing expected by the markets to bolster the shrinking world growth and Economy.
Silver too is following in the footsteps of Elder brother gold in the Negative trend and that too in the downward trend channel as marked in the charts.
The channel has been trending downside where the resistance emerges at Rs. 55600 levels and support around 52600 levels which could be bought into given the amount of correction that has been happening.
Given the factors affecting the global economy and news flow coming in it cannot be ruled out that silver too could be in the limelight again alongwith GOLD. Since both of them have been correcting for some time now and value buying at current levels cannot be ruled out.
It would be advisable to add positions in the commodity on dips with 52000 being the stoploss and 55600 levels as the likely target zone.
(Inputs Mr. Hemanth .V, Faculty TA, Stock Market Institute, Bangalore)