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Israel's prime minister and defense minister would like to attack Iran's nuclear sites before the U.S. election in November but lack crucial support within their cabinet and military, an Israeli newspaper said on Friday.

The front-page report in the biggest-selling daily Yedioth Ahronoth came amid mounting speculation - fueled by media leaks from both the government and its detractors at home and abroad - that war with Iran could be imminent even though it might rupture the bedrock ties between Israel and the United States.

"Financial system preparing for Iran strike," says Fischer. The Bank of Israel Governor also said that the financial system is preparing for an Israeli strike in Iran and a resulting downturn in the economy.

With the eurozone showing signs of contracting despite Germany's economic growth, the probability increases that more monetary stimuli such as QE3 is necessary to save the world economy from falling deeper into unsustainable debt levels.

The financial system is beyond the point of no return and without any prospects of world economic growth. This could have potentially devastating consequences to an already fragile system if we go to war with Iran. The explosive impact this could have on world precious metals like gold and silver could be unprecedented.

Germany's government Friday said it believes that the country's economy grew at a moderate pace in the second quarter. But data from elsewhere suggests that won't be enough to save the eurozone from suffering a return to economic contraction.

Figures on France, released by statistics agency Insee, showed industrial output was unchanged in June compared with May. Thus 0.6% lower in the second quarter than in the first, giving a gloomy signal for overall economic growth during the period. The fall in production, "confirms our view that GDP has been contracting in the second quarter, even though probably only slightly," said Fabrice Montagne, an economist at Barclays.

Fears that France's economy is shrinking were heightened by the Bank of France's latest business survey this week that suggested gross domestic product will fall 0.1% in the third quarter. An earlier survey showed output falling in the second quarter of the year. Meaning France would meet many economists definition of being in recession.

Let's take a look at the daily gold and silver chart technical indicators below and see what we can look forward to next week in the face of these potentially explosive bullish fundamentals.

The August (Comex) gold contract closed at $1.623. The 52 week Range is: $1,529.30 - $1,921.50.

The market closing above the daily 9, 18 and 36 day MAs on a weekly basis is confirmation the trend momentum is bullish.

With the market closing above the weekly VC Weekly Price Momentum Indicator of $1,620 is confirmation the trend is bullish.

Look to take some profits if long, as we reach the $1,633 to $1,643 levels early next week. If stops are taken out here, we could see a rally up to the $1,680 to $1,700 weekly resistance levels.

Buy corrections at the $1,610 and $1,598. levels to cover shorts and go long on a weekly reversal stop. If long use the $1,598 level as a SCO/GTC (Stop Close Only and Good Till Cancelled order).

The December (Comex) silver futures contract closed at $28.15. The 52 week Range is: $26.20 - $44.19.

The market closing above the daily 9, 18 and 36 day MAs on a weekly basis is confirmation the trend momentum is bullish.

With the market closing above the VC Weekly Price Momentum Indicator of $28.05 is confirmation the trend is bullish.

Look to take some profits if long, as we reach the $28.50 and $28.79 levels early next week. If stops are taken out here, we could see a rally up to the $30 per ounce weekly resistance.

Buy corrections at the $27.73 to $27.31 levels, to cover shorts and go long on a reversal stop. If long use the $27.31 level as a SCO/GTC ( Stop Close Only and Good Till Cancelled order).

Source: Weekly Gold And Silver Report For August 10, 2012: I Hear The War Drums Beating!

Additional disclosure: Precious metals products trading involves significant risk of loss and is not suitable for everyone. Past performance is not necessarily indicative of future results.