Bullions & Base Metals Weekly ( 08/12/08 To 13/08/08)

Gold

Bearish Engulfing; likely to head lower towards $680.

Gold prices found strong resistance at 61.8% retracment resistance ($930-$980) around $830 and fell sharply forming a Bearish Englfing pattern for the week. The pattern indicates weakness in prices and we expect Gold to fall towards $680 in the coming week.
As advocated, RSI faced strong resistnace around 60-65 zone and now seems headed towards 32-25 zone.
Weekly resistance is at $835/$877/$905 and support is at $730/$715/$700.

Gold has breached the long term rising channel and we now expect prices to witness correction towards $650-$600. RSI has breached the bull range (56-84) it was trading since the bull run started in Sept 2001 indicating that Gold has now entered a bear phase.

Silver

Breach of consolidation ($10.7-$9) to determine further direction.

While Silver has breached the falling trend line, prices seem to be lacking momentum and are thus trading sideways. With the sideways correction , Silver seems to be forming a triangle. A breach from the traiangle will determine further direction, till then expect prices to consodlidate between $10.70-$9.

A breach of triangle on the lower side below $9 will take prices lower towards $7-$6.5 where as a breach on the upside will take prices towards $13.

Weekly resistance is at $10.30/$10.70/$11.20 and support is at $9/$8.40/$8.0.

Crude

Cautious pessimism.

Crude prices continue to appear weak with prices further falling last week by $14 making a low of $40.5.

Crude appears to be weak and could test $35 once the immediate support at $40 is breached.

However an important point to note is that RSI is forming a Positive Divergence with prices; thus while we are bearish, we shall be on the lookout for any signs of change in price
trend.

Weekly resistance is at $47/$50/$52 and support is at $40/$37/$35.

Natural Gas

Bearish; likely to test $5 mark.

Natural Gas prices faced strong resistance at falling trend line around $7 and fell sharply making a new low at $5.9. Natural Gas prices appear to be weak for the coming week and are likely to test $5 mark.

Weekly resistance is at $7/$7.5/$8.15 and support is at $5.5/$5/$4.5

Aluminum

Below $1480, fall likely towards $1255.

Aluminum prices continued their downfall within the channel testing the lower band of the channel at
$1485.

Taking a look at the monthly chart, Aluminum is trading below its 78.6% retracement and still appears to be weak. A breach of the falling channel at $1480 would accelerate the fall in prices and lead to prices falling towards $1255 levels.

Weekly resistance is at $1612/$1650/$1750 and support is at $1480/$1317/$1255.

Copper

Weak, likely to edge lower towards $2800.

Copper prices were unable to breach the falling trend line and fell sharply making a new low at $2991.

Copper prices appear to be weak and are likely to edge lower towards $2600. Any relief rally is likely to face strong resistance at the falling channel at $3370.

However it is important to note that while prices made a new low, RSI has made a lower low forming a positive divergence with prices. Thus while we remain bearish, we shall be on the look out for any signs of change in price trend.

Weekly resistance is at $3370/$3480/$3616 and support is at $2990/$2800/$2600.

Nickel

Bearish as long as resistance at $10500 holds true.

Nickel prices continued trading in a narrow range with negative bias.

As long as resistance at $10500 holds true, we expect prices to fall lower towards $7800/$7600.

Weekly resistance is at $10500/$10980/$11500 and support is at $8850/$7800/$7500

Lead

Weak; likely to face strong selling pressure on any relief rally.

Lead prices continued their downfall last week retracing back 100% of the bull rally from $925 to $3880.

Lead prices still appear to be weak and are likely to face strong selling pressure on any relief rally.

Weekly resistance is at $1080/$1200/$1275 and support is at $900/$850/$800.

Zinc

Below $1050, fall likely towards $950/$850

Zinc prices traded with a negative bias making a new low at $1050.

For the coming week, if the low at $1050 is breached, Zinc could edge lower towards $950/$850.

Weekly resistance is at $1100/$1150/$1200 and support is at $1050/$950/$900.