Market Commentary

Market Commentary

Ø Eurozone debt and reports of good gold buying from China gave a boost to the metal overnight with it opening higher at 1638.25/1639.25. Investor uncertainty as they wait upon tomorrow’s jobs data had the metal range bound today. Slipping to an intraday low of 1633/1634 just after the open, buying interest then propped up the metal, taking it to its intraday high of 1645.50/1646.50 midsession. The lack of investor commitment on the day however, saw gold close on its open at 1638.25/1639.25.

Ø Silver opened on its intraday low of 29.59/29.64. Range bound during the first half of the session, silver then found the bids as base metals gained, taking it to an intraday high of 30.19/30.24. Late session profit taking took the metal to its close at 29.90/29.95.

Technical Commentary:

Ø Gold is firmer today at 1639. The metal is finally closing back above its 200 day moving average at 1636. This is the 7th up day in the past 10 trading sessions in a move that has come from 1523. We are more neutral now from our bearish outlook. The Elliot Wave count still favors the down side while 1667 holds the topside price action. We suggest short term traders are now comfortable with the long Gold position, but would look to liquidate on a break back below 1605.

Ø Silver is unchanged today at 29.93. We see significant resistance at 30.71 from the mid November support and at 31.02 from a trend line off the Nov/Dec highs. Silver has made a nice recovery from the late December lows at 26.20. Our bias remains bearish Silver due to the overall weak price action. The Gold Silver ratio is firmer at 54.82. The ratio seems to be moving sideways between 54 and 57. While we hold above 54, we believe the risk is for a move up oward 59.70 (76.4% Fibo).

Technical levels for 12^th Jan, 2012:

Metal	Support ($/oz)	Resistance ($/oz)
Gold	1627.86	1656.11
Silver	29.507	30.330

Economic Calendar:

Date	Economic Indicator	Country	Actual	Forecast	Previous	Effect & Remarks
12th Jan	Core Retail Sales m/m	USD	Pending at 7:00pm	0.3%	0.2%	If Actual > Forecast = Good for currency. Change in the total value of sales at the retail level, excluding automobiles.
12th Jan	Retail Sales m/m	USD	Pending at 7:00pm	0.3%	0.2%	If Actual > Forecast = Good for currency. Change in the total value of sales at the retail level.
11th Jan	Crude Oil Inventories	USD	5.0	0.9	2.2	As Actual > Forecast = No consistent effect - there are both inflationary and growth implications. Change in the number of barrels of crude oil held in inventory by commercial firms during the past week.

Disclaimer:

This report contains the opinion of the author, which is not to be construed as investment advices. The author, Directors, other employees of RiddiSiddhi Bullions Ltd. and its affiliates cannot be held responsible for the accuracy of the information presented herein or for the results of the positions taken based on the opinions expressed above. The above-mentioned opinions are based on the information, which is believed to be accurate, and no assurance can be given for the accuracy of the information. The author, directors and other employees and any affiliates of RSBL cannot be held responsible for any losses in trading. In no event should the content of this research report be construed as an express or an implied promise, guarantee or implication by or from RSBL that the reader or client will profit or the losses can or will be limited in any manner whatsoever. Past results are no indications of future performance. Information provided in this report is intended solely for informative purposes and is obtained from sources believed to be reliable. The information contained in this report is no way guaranteed. No guarantee of any kind is implied or possible where projections of future conditions are attempted. We do not offer any sort of portfolio advisory, portfolio management or investment advisory services. The reports are only for information purpose and are not to be construed as investment advices.