Oct. 11 (MF Global) -- Price Outlook
Precious metals are expected to maintain their sideways-to-higher directions in the near-term, but whether markets rally or sell off on any given day appears to be dictated by the direction of movement on European sovereign debt. Momentum appears to be on the side of repairing the fractured euro, with Germany’s Merkel and France’s Sarkozy anticipated to unveil a rescue plan at the G20 summit on Nov 3-4. Support may also come from a small recovery in investment and from the return of Chinese buyers in the physical market after last week’s holiday. The negative side will focus on open interest data and the reduction in the probability that QE3 will be implemented soon. We favor trading precious metals as positive affairs today.