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Morgan Stanley still bullish ags and gold, though the former seems to lack any near-term catalysts. We see gold continuing to perform in 4Q12 with no near-term end in sight to the easing cycle, especially given the co..

05 Nov 2012

LONDON (Commodity Online): Morgan Stanley remains upbeat on gold longer term, suggesting more longs could exit in the near term but also saying this may prove to be a buying opportunity.

In a monthly commodities report, the firm describes itself as "still bullish ags and gold, though the former seems to lack any near-term catalysts. We see gold continuing to perform in 4Q12 with no near-term end in sight to the easing cycle, especially given the continuation in central-bank gold buying. We remain bullish ags but do not believe that there will be catalysts in the coming month as the U.S. harvest winds down and South American planting is ongoing."

Gold fell sharply Friday after a stronger-than-forecast U.S. jobs report lifted the dollar, with prices falling below the key technical area of $1,700 an ounce. After the recent high net length of speculators, "we would not be surprised to see continued flushing out--but view this price weakness as a solid buying opportunity ahead of a rebound heading into year-end,” they continues.

Meanwhile, Morgan Stanley says platinum group metals "remain largely in limbo between an uncertain supply outlook in South Africa and the currency-driven weakness in the gold markets."


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