Monday morning rise in silver is insane. Bullish momentum can continue after Trump’s H1B visa fee rise to $1,00,000 for new workers. Traders and markets are taking is as protectionism.
I cannot predict when will there be a correction in gold and silver. US president is creating total chaos in every Asian country (except Israel) every day. As long Trump continues to create chaos there will be very small corrections followed by a very big rise.
US president Trump moves indicates that he intends to make USA a closed economy. Free Trade is more or less dead. Bilateral trade deal is on the rise. Gold and gold backed trade deal has started taking place between group of nations and economic bloc (which does not include USA, UK and Europe.).
India’s forty-day festive season will begin from today. There is a big big shortage of physical gold and physical silver in India. Physical Premiums are rising with passing of each day in gold and silver in India. It seems people of India intend to eat physical gold and physical silver during the forty-day festive time. (just to say how much demand is expected.).
A below expectation jewelry demand and/or physical demand (gold and silver) in India can result in a big sell off. Too early to think of this. We still need to keep a close watch on India’s demand till first week of November. Indian retail demand will crash or sink in the festive season if local prices (of gold and silver) rise another fifteen percent by end October.
In my view, Jewelers in India have hedged in India local commodity exchanges and global commodity exchanges. As sales start to pick up, there will be de-hedging by large corporate jewelers and large physical dealers in India. De-hedging demand (if any) in India will result in an intraday sharp two-way price moves.
Big crash or big sell off (if any in gold and silver) will be limited till 12th October. Peak Indian demand for gold and silver (in any form) should be between 22nd September to 12th October. On or after 13th October, I expect a falling trend in India festive demand for gold and silver, unless there is a price crash of more than five percent (from the highs).
Chinese savers have $23 trillion savings pile. Cash is still king for China’s nation of savers. If just ten percent of Chinese savings goes to gold/silver in physical form, then the new hyper bullish trend could be unthinkable. For now, I will be closely watching Chinese retail spending trend in the holidays in the first week of October.
Traders will be long or buy on dips or stay invested for the final quarter of the year. There will not be any major profit taking in gold and silver till 30th September. Small corrections here and there will be there.
SPOT SILVER – current price $43.40
Spot silver can rise to $45.10 and $49.38 (in the short term) and more as long as it trades over $42.10 on daily closing basis.
Crash or sell off will be there if spot silver has a daily close below $42.10 for four consecutive trading sessions.
Lower price base as of now around is $40.80 for the rest of the year OR it means that spot silver is bullish as long as it trades over $40.80 on daily closing basis till Christmas and New Year.
Over brought. Hyper bullish retail sentiment.
There can be some very sharp two-way price moves.
Intraday traders and jobbers should remain on the sidelines due to over brought technical.
Views are intraday unless otherwise specified.
Disclaimer
The investment ideas provided is purely independent view point and are solely for collective learning and for academic interests. There is no commercial benefit accruing or have deemed to accrue to me out of providing such investment ideas.
The investment ideas shared here cannot be construed as investment advice or so. If any reader is acting on these advices, they are requested to apply their prudence and consult their financial advisor before acting on any of the recommendations made here. I am not responsible to anybody in the event of profits and losses (if any) upon acting on such advice.
I hope that our reader is aware about this well aware of the risk involved in trading in commodity derivative trading.
Disclosure: I trade in India's MCX commodity exchange. I have open positions in India's MCX commodity future. I do not trade in CME future or OTC spot gold and spot silver.
NOTES TO THE ABOVE REPORT
ALL VIEWS ARE INTRADAY UNLESS OTHERWISE SPECIFIED
Follow us on Twitter @chintankarnani
PLEASE NOTE: HOLDS MEANS HOLDS ON DAILY CLOSING BASIS
PLEASE USE APPROPRIATE STOP LOSSES ON INTRA DAY TRADES TO LIMIT LOSSES.
THE TIME GIVEN IN THE REPORT IS THE TIME OF COMPLETION OF REPORT
ALL PRICES/QUOTES IN THIS REPORT ARE IN US DOLLAR UNLESS OTHERWISE SPECIFED.
ALL NEWS IS TAKEN FROM REUTERS NEWSWIRES.
TECHNICAL ANALYSIS IS DONE FROM TRADINGVIEW SOFTWARE
About the author
