MORNING UPDATE BULLION - Bullion ended weak on Saturday after prices ended higher on Friday as a European deal to shore up banks and cut borrowing costs lifted bullion's investment appeal. Positive news out of Europe coupled with tepid U. S. data served as the perfect cocktail for bullion to soar and the dollar to drop.

Crude ended higher after EU leaders agreed to support ailing euro zone banks and preserve the single currency. Natural gas rose as hot weather that may boost demand from power plants for air conditioners was forecast for most of the U. S.

Base metals surged on Friday as the latest euro-zone rescue deal boosted a broad range of commodity and financial markets with investors scrambling to cover short positions. Leaders of the 17-nation euro zone a g reed rescue funds could be used for sovereign debt purchases without forcing countries to adopt extra austerity measures.

GOLD MARKET UPDATE - Gold futures rebounded to settle significantly higher, as the European Union agreed to take urgent measures to help stabilize the Spanish and Italian bond markets and the ailing eurozone banking sector. The euro climbed to its highest since October, with the dollar dropping against most major currencies. For the week, gold prices gained 2 percent. Monetary stimulus by central banks and governments is bullish for gold, which has been a favorite among hedge fund managers and institutional investors to hedge against the loss of purchasing power due to currency depreciation and inflation. Gold coin consumption, viewed by some as a market-fear gauge, tumbled in the second quarter to levels not seen since before the 2008 economic crisis, reflecting the metal's failure to attract safe-haven bids despite economic uncertainty. Physical gold buying in major consumer India picked up a little. Weakness in Indian demand has undermined spot prices this year, with Indian gold prices near record highs due to rupee weakness. ales of the U. S. Mint's American Eagle gold coins fell more than 50 percent year-on-year to 127,500 ounces in the second quarter, their worst three months since the second quarter of 2008 -- prior to the height of the global economic crisis. Now support for the gold is seen at 1562.90 and below could see a test of 1528.50. Resistance is now likely to be seen at 1619.40, a move above could see prices testing 1641.50.

Gold$ trading range for the day is 1583.3-1603.5.

Gold ended higher Friday as European deal to shore up banks and cut borrowing costs lifted bullion's investment appeal.

Monetary stimulus by central banks and governments is bullish for gold, which has been a favorite among hedge fund managers

AS LONG AS GOLD IS TRADING BELOW 1602$ CAN RETEST SUPPORT AT 1580$

PROJECTION - Gold hovered below $1,600 pausing after posting its strongest daily rise in a month in the previous session on a euro zone deal aimed at helping its debt-laden members.

SILVER MARKET UPDATE - Silver soared after EU leaders agreed to let their rescue fund inject aid directly into stricken banks from next year and intervene on bond markets to support troubled member states. Positive news out of Europe coupled with tepid U. S. data served as the perfect cocktail fo gold to soar and the dollar to drop. European Union leaders gave the green light for rescue funds to stabilize bond markets withou forcing countries in compliance with deficit regulations to shoulder added austerity measures. E. U. officials also allowed the continent's bailout fund, the European Stability Mechanism, to directly recapitalize banks, which won't add to overall national debt burdens since the money will go straight to banks and bypass sovereign books. E. U. policymakers also agreed to launch a supervisory body for eurozone banks by the end of this year. The news surprised investors, who were worried the summit would produce statements of good intentions but little in the way of policy. Relief sent bond yields soaring, especially in higher-risk countries like Spain that will benefit the most from the measures, and the dollar falling. Now support for the silver is seen at 26.55 and below could see a test of 25.62. Resistance is now likely to be seen at 28.17, a move above could see prices testing 28.86.

Silver$ trading range for the day is 27.06-27.66.

Silver soared on Friday after EU leaders agreed to let their rescue fund inject aid directly into stricken banks from next year

Positive news out of Europe coupled with tepid U. S. data served as the perfect cocktail for bullion to soar

BUY SILVER$ @ 27.10$ SL 26.80$ TGT 27.60$

PROJECTION - Silver soared after EU leaders agreed to let their rescue fund inject aid directly into stricken banks from next year and intervene on bond markets to support troubled member states.

CRUDE MARKET UDPATE - Crude Oil futures jumped to settle at a three-week high, on news of a deal at the European leaders summit meeting where the European Union will take urgent action to help stabilize the Spanish and Italian bond markets and the ailing eurozone banking sector. European leaders attending a two-day summit agreed on a plan to use bailout funds to directly aid banks in Spain and Italy. The news proved a boon for markets world-wide, which had been on edge due to fears the euro-zone crisis would worsen. Dealings of physical North Sea crude remained muted on Friday as oil workers' strike in Norway continued to shut in part of its oil output, boosting prices. The curren strike in Norway's oil and gas industry has cut oil production by an estimated 219,000 barrels per day. E. U. officials also allowed the continent's bailout fund, the European Stability Mechanism, to directly recapitalize banks, which won't add to overall national deb burdens since the money will go straight to banks and bypass sovereign books. E. U. policymakers also agreed to launch a supervisory organization for eurozone banks by the end of this year. The news surprised investors, who were worried the summit would lead to little in terms of concrete policy tools. Now support for the crude is seen at 80.40 and below could see a test of
76.00. Resistance is now likely to be seen at 87.90, a move above could see prices testing 91.00.

CRUDE $ trading range for the day is 75.99-91.01.

Crude ended higher after EU leaders agreed to support ailing euro zone banks and preserve the single currency.

European leaders agreed on a plan to use bailout funds to directly aid banks in Spain and Italy

BUY CRUDE @ 83.50$ SL 82.50$ TGT 85.50$

PROJECTION - Crude eased as weak China data spurred some caution, after prices posted their fourth biggest daily gain in the previous session on a surprise deal by EU leaders to shore up the region's banks.