Market Commentary

Ø Gold opened higher at 1674.50/1675.50. Light profit taking ahead of equities opening took the metal to its intraday low of 1666.25/1667.25. Gains in equities coupled with declines in the dollar, saw renewed buying interest in the metal, taking gold to its intraday high of 1681/1682 mid session. Gold quietly ended the session at 1677/1678.

Ø Silver opened higher at 32.39/32.44. Like gold, profit taking in the metal took it to its intraday low of 31.91/31.96 early morning. Strong gains in base metals and crude reversed silver’s decline as steady bids took the metal to its intraday high of 32.72/32.77 mid session. Late session profit taking brought silver to its close at 32.29/32.34.

Technical Commentary:

Ø Gold closed higher again today at 1677, after Friday's strong close. Key support sits at the 200-day moving average, currently at 1643. Gold has managed to close above the 200-dma for the past 5 sessions. Resistance sits at 1700, where we saw good support in November to early December.

Ø Silver closed slightly higher today at 32.29/34 after its big rally on Friday. Key support sits at 29.12, the 50% Fibonacci retracement of the 2008 to 2011 rally and resistance at 34.00, the 38.2% Fibonacci level. The Gold-Silver ratio closed at 51.90 and is targeting a move back to 50.00.

Technical levels for 24^th Jan, 2012:

Metal	Support ($/oz)	Resistance ($/oz)
Gold	1,665.97	1,684.79
Silver	31.807	32.784

Economic Calendar:

Date	Economic Indicator	Country	Actual	Forecast	Previous	Effect & Remarks
24th Jan	French Flash Manufacturing PMI	EUR	Pending at 1:30pm	49.2	48.9	If Actual > Forecast = Good for currency. Level of a diffusion index based on surveyed purchasing managers in the manufacturing industry.
24th Jan	German Flash Services PMI	EUR	Pending at 2:00pm	52.6	52.4	If Actual > Forecast = Good for currency. Level of a diffusion index based on surveyed purchasing managers in the services industry.

Disclaimer:

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