Oro y Finanzas

Thursday, 18 May 2006
Gold was sold on access prior to Tocom, which opened nearly fourdollars lower compared to the closing price last night. The metal weakenedfurther to see $680/oz which seemed to provide some support. In Europe themetal recuperated some of its losses and unsuccessfully challenged the $690resistance retreating before the opening of the NY session.

The pricesfinally broke above to trade $694.50/oz helped by the worse then expectedUS jobless number. According to the government report the US jobless claimssurged last week to seasonally adjusted 367 thousand compared to 318awaited. The rise was due to a partial government shutdown in Puerto Ricowhich added 46,000 unadjusted claims. The layoffs in Puerto Rico started onthe 1st of May due to funding crisis, but Labor Department analysis saythat it should not be a factor next week. Subsequently the prices eased abit, but were pulled back up by the weaker then awaited US leading economicindicator number. The metal continued its choppy price action retreatingand pulling back up to close on a weak tone, at $681.

The overall upside potential remains with volatility being the maindescription of the market. For the short term we believe that the metalwill continue being influenced by the US dollar moves and that theconsolidation phase is not over yet. The prices are for the moment beingenclosed by the $680-695 range with dips attracting fresh buying and peaksprofit taking. A break below the $675 level might however bring to a priceretreat back to the $600 mark.

Silver volatile market condition persisted. The metal was mirroringthe gold’s moves with at first supportive bids around $12.90 level. Thefixing price came out to be 70 cents lower compared to the $13.82 ofyesterday. The metal made a high of $13.33 and then a low of $12.87 cappedby profit taking. Further selling pressure extended the lows to $12.60/ozin the late afternoon and closed just five cents above it. We expect themetal to continue trading the $12.50-14.00 range for the short term with adownside correction not being ruled out.

MKS Gold & Silver, Daily Report
by Lidia Nazarova

Disclaimer

Although the information in this report has been obtained from and is basedupon sources MKS believes to be reliable, we do not guarantee its accuracyand it may be incomplete or condensed. All opinions and estimatesconstitute MKS’ judgment as of the date of this report and are subject tochange without notice. This report is for informational purposes only andis not intended as an offer or solicitation for the purchase or sale of aninvestment. This report does not consider or take into account theinvestment objectives or financial situation of a particular party.