Compiled 10/13/08 6:00 AM (CT)

Statistics: London Gold Fix $865.00 -$53.00 LME Copper stocks 209,325 tons -75 tons

SILVER MARKET FUNDAMENTALS: (6:00 AM CT) The silver market appears to be getting short covering buying interest, some currency related buying and perhaps even some spillover physical commodity market buying in the early going today. It is also possible that some players are beginning to notice a recent tightening of silver exchange stocks, but perhaps the biggest shift from late last week to this morning's action, is that the fear of significant economic slowing might be temporarily put on the back burner. However, with the silver market from the late September highs falling by roughly $4.48 cents an ounce, it was clear that the silver market was significantly oversold. In fact, the October 7th Commitment of Traders with Options report for Silver showed the Non-commercial position to be net long 11,657 contracts, with the Non-reportable position also net long 14,689 contracts and that made the "combined" spec and fund position net long 26,346 contracts as of early last week. However, with the silver market falling by almost $2.00 per ounce since the COT report was measured, some traders are suggesting that the silver market saw its net long positioning balanced rather significantly. On the other hand, since the silver market seemed to prefer the physical commodity market track for most of last week that could mean that silver is generally poised to benefit from the initially favorable action in the US equity markets today.

OUTSIDE MARKET DEVELOPMENTS: (6:00 AM CT) One might have expected the gold market to come in under pressure today in the wake of a massive coordinated government intervention in the global banking system. Perhaps some players see the government moves as inflationary, but perhaps the metals trade is once again simply tracking the action in the US Dollar. Some traders are suggesting that the upside action in the gold market today is classic technical short covering action from the compacted selling effort seen at the very end of the last week. Other traders suggest that the coordinated efforts to quell the global banking crisis have reduced the threat of severe and ongoing deflation and perhaps the moves have also increased the odds of inflation. In almost every viewpoint in the marketplace there seems to be expectations of more violent two sided price action ahead. With a partial US Banking holiday today and the US stock markets showing significant strength, it is possible that some flight to quality longs in the gold market will be doubt their positions somewhat in the early going today.