Last Updated : 10 October 2012 at 13:10 IST
Gold, Rupee indications ask: Is market insanity the new normal?
Source :Commodity Online Editorial Desk
Author :Rakesh Neelakandan
Certain media reports quoted analysts as saying that the psychological factor significantly weighed on the markets. But an overdose of this element does not smack of grey-cells and often borders on market insanity. Ultimately, the smartest of the lot makes money and being smart is not being insane.
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AHMEDABAD (Commodity Online): With rupee rates swinging back and forth, the bullion commodities are also exhibiting volatility to a large extent. While the appreciation in rupee helps gold prices on the upside, the depreciation of the same, or in other words, the strengthening of dollar arrests the upside and drags gold prices down.
“Bullion prices have been trading in a very volatile range as rupee depreciation-appreciation cycle continues. It is limiting the downside momentum in our market but also fuelling uptrends.” noted Ankush Jain, Manager-Research(metals-energy), Commodity Online.
Technically Silver December contract is having good support at Rs.61000 and resistance at Rs.61800, even as in gold, December contract support is expected at Rs 31330 and resistance at Rs 31500 for an intra-day session.” he added.
He has advised intra-day traders to buy MCX Silver December contract above Rs.61800 with stop loss of Rs.61500 for target near Rs.62100 and Rs.62400. For gold, it is advised that traders take a long position around Rs.31390 with stop loss of Rs.31330 for target near Rs.31460 and Rs.31530. Meanwhile, short sellers are advised to take a new short selling position in gold only below Rs.31330 and in silver only below Rs.61000.
State of the Rupee and a host of indications
Rupee has touched 53 mark against greenback as investors around the globe are trying hard to be agile and applying staying-ahead-of-the-curve strategies to curtail loss of asset values and register gains.
They are responding to periodic data releases in a big way and given the sorry state of the global economy, the community is often bewildered as what to do next.
A positive employment market report last week strengthened the greenback and rendered gold prices and crude oil prices dull. But in a trice, the community felt insecurity at the state of European economy and reverted back their stand sending bullion and crude oil prices up.
Certain media reports quoted analysts as saying that the psychological factor significantly weighed on the markets.
But an overdose of this element does not smack of grey-cells and often borders on market insanity. Ultimately, the smartest of the lot makes money and being smart is not being insane.
One would say this is something of an everyday tale and a cliché. It is not the case as per certain observers the happenings as currently being staged in the global economy has never been enacted before and is sort of unprecedented.
One may often wonder if insanity is getting to be the new normal. Answer is that fundamentals remain the same. (firstname.lastname@example.org)
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