4 th September, DGCX- on the move:

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1 DGCX- on the move: 4 th ember, Gold and silver- post a weekly gain of 0.24% and 4.84% respectively. US dollar exhibited mixed behavior - rising against the Japanese yen by 0.4% but falling against GBP by 0.96% and against Euro by 0.57%. Total number of gold contracts traded since inception crossed the 300,000 mark during the week. The precious metals market rose for a second straight week. Though the yellow metal ended the week with a tiny gain of 0.24%, silver managed to put up a robust performance gaining 4.84% over the week thereby rising for a third week in a row. The currency market witnessed the Pound record a sizable gain of 0.96% against US dollar. US Dollar lost 0.57% against Euro but gained marginally by 0.4% against Japanese Yen. At DGCX a total of 2,372 contracts valued at $ million were traded during the week. DGCX October delivery gold futures contract began the week on a flat note at $ /troy oz a tad lower than its previous week s close of $625. Prices plunged initially to an intra-week low of $60.70 /troy oz but rallied thereafter on persistent buying in the later part of the week. This helped the contract to climb a high of $629.30/troy oz. Profit booking at higher levels pushed prices lower and the contract finally settled for the week at $ /troy oz. DGCX December delivery gold contract started the week at $63.30 /troy oz and after sliding to a low of $67/troy oz, scaled a peak of $634.0/troy oz. The contract concluded the week at $632.20/troy oz. DGCX ember maturity silver contract opened the week at $2.5 /troy oz, which incidentally remained the lowest price for the week. Backed by a strong rally, the contract ended the week at $3.000/troy oz locking in the gain of 60 cents per troy oz. In the DGCX currency market segment, near-term Euro contract started trading for the week on a positive note at $.2809 /Euro. After falling back to an intra-week low of $.2774/Euro, it climbed to high at $.2888/Euro. ember delivery Euro contract finally settled for the week at $.2845/Euro. The Yen contract for ember maturity slipped lower by 2 ticks and closed the week at $ for 00 Yen. The ember maturity GBP contract posted a gain of.8 cents per pound. It began the week at $.8962 /GBP, touched a weekly-high of $.9078 /GBP and finished the week at $.907 /GBP.

2 Aug DGCX October Gold Futures Contract Aug Aug Aug Open Interest Volume ember DGCX ember Silver Futures Contract DGCX ember EURO Futures Contract DGCX ember JPY Futures Contract DGCX ember GBP Futures Contract

3 Economic Alerts: The Yen traded lower for the week against the Euro on expectations that the European Central Bank will raise interest rates while the Bank of Japan keeps borrowing costs on hold. Japan's currency is also being hurt by the so-called carry trade where an investor borrows low-yielding yen to finance investments in countries with higher benchmark lending rates. US Employment report fell in line with the view that the economy is slowing along with wage pressures. Non-farm payrolls advanced by a moderate 28,000 in August in line with the consensus forecast for a 30,000 gain. As widely expected, the European Central Bank kept their key interest rate at 3% after raising interest rates on August 3. Money supply in the country continues to be well over target level of 4.5% respectively. Japan's industrial production unexpectedly dropped in July, reducing expectations for higher interest rates this year. Factory output dropped by a seasonally adjusted 0.9 percent in July from a month earlier. World Markets in motion: Market Previous Week close Current Week close % Change US S&P % Spot Gold - ($/ounce) % DGCX Oct Gold futures ($/ounce) % Spot Silver - ($/ounce) % DGCX Silver Futures - ($/ounce) % DGCX Euro / USD futures % DGCX GBP / USD Futures % DGCX JPY / USD Futures % NYMEX Oct Crude oil ($/barrel) % Market Mood: Precious metals prices continued to surge ahead for the second consecutive week. Analysis and comments from some of the experts in the field were as under: Barclay's ishares Silver Trust, a silver metal exchange traded fund, has been adding silver metal to its holdings. On August 30, the ETF passed a significant milestone in

4 its short four-month existence by eclipsing 00 million ounces of the white metal acquired and held (00,368,644 ounces to be precise). Positive money flow into the highly liquid metal investment vehicle continues in a stealthy sort of way. The trust is a continuous offering exchange traded fund designed to track closely with the price of silver. Each share of silver approximates 0 ounces of silver metal. The amount of metal holdings and the number of shares of the trust fluctuate according to the price of, and demand for the shares relative to the price of silver. The trading vehicle only invests in silver metal and does not use futures, options or derivatives. While silver traded in a tight trading range during the usually light August liquidity period, there has obviously been considerably more buying of the silver ETF than selling. Arguably that indicates a significant collective appetite by market participants large and small for the second most popular precious metal at current levels. Gold production in India increased by 56.9 percent in the four month period ended July 3 at 3.73 tonnes as against 2.60 tonnes of the metal produced in the corresponding period last fiscal. Demand for gold jewellery in the country which accounts for a substantial chunk of the global demand, has considerably gone down owing to rising and volatile gold prices. In terms of weight, the gold jewellery demand has steeply declined by 43 percent in first quarter of this fiscal as compared to the same period last year. In terms of value, the demand in the country has fallen by 3 percent during the quarter. Internationally, gold jewellery consumption has declined by 6 percent due to volatility. Interestingly, overall demand for plain gold has gone up all over the world. The demand has risen by 36 percent in India, while it has climbed by 23 percent during the quarter. Out of the,200 tons of gold consumed annually in India, 700 tons is used for making jewellery. The market is about to be presented with an additional avenue of exposure and is likely to prompt considerable further activity. ETF Securities Ltd is expected to launch 29 new Exchange Traded Commodities, or ETCs, on the London Stock Exchange. These Exchange Traded Commodities are different from the gold and silver ETFs. The latter involve the physical storage of allocated metal while the ETCs revolve around futures contracts with the exposure managed by leading industry members. The Oil ETC (ETFS Brent Oil), for example, which is run by ETF Oil Securities Ltd, which started trading on st August 2005 uses Shell to manage

5 the oil exposure. The ETC s are thus open-ended securities and can be bought or sold by investors on a regulated exchange in the same way as any equity. The important point to note about these with respect to their impact on the market is that because they do not involve physical delivery, they need not generate the speculative borrowing that developed in the silver market ahead of the launch of the silver ETF. The classes of commodity securities cover base and precious metals, energy, softs and livestock. Technical View: A fairly volatile week saw gold prices initially fall to its lowest levels after July 24, and then post a strong recovery in the later part of the week to end the week with a small gain of $.50/troy oz or 0.24% on DGCX. Incidentally, the yellow metal recorded gains for a second consecutive week. In contrast to the insignificant rise in gold prices, silver prices moved up strongly by 55 cents or 4.8% during the week and shot above a significant technical barrier of $2.55. Analysts feel that the short-term gold charts are looking promising and further rally in prices could be in the offing in the days ahead. The technical parameters on which such views are based are as follows. On the weekly charts of DGCX gold futures, a small hammer pattern has been formed after a doji candle formation in the earlier week. Whereas a hammer pattern is a known bullish reversal pattern the doji also at times presages a reversal in trend. This implies that the current downward or sideways move in gold could end giving way to a bullish trend. For a confirmation of reversal, the hammer pattern needs to be followed by a bullish candle in the next week. If it happens, it could be read as a signal for resumption of intermediate uptrend in the yellow metal. The other technical parameters as of now do not wholeheartedly support bullishness. A fall in volumes along with a declining open interest on up-days is considered as a bearish technical signal. The price line is yet to cross above the 3-week Exponential Moving Average (EMA) which is flat. The medium-term down trend line is yet to be crossed. Most of oscillators continue to fall. The MACD along with the Stochastic (8,3,3) remains in a sell mode. The 8-RSI however is rising. The silver lining is provided by MACD histogram that has given an up tick after a positive divergence with the prices. This again can be read as an advance trend-change signal. A sharp and sustained rally in the week ahead can improve the technical picture significantly

6 and pave way for a bullish trend reversal in the medium-term. A weekly close above $629 may be considered as an initial signal for bullishness. On the daily charts a short-term uptrend seems to have set in. A daily close above $628.0 will technically confirm the beginning of an upswing. The price has crossed above the 5 & 3-day EMA. The momentum indicators on short-term charts show improvement. The MACD though in a sell mode as yet, is rising towards the trigger line. The Stochastic oscillator is in buy mode and rising. The 4-RSI is also moving upwards. Most of the oscillators are rising after showing a bullish divergence with the prices. All these factors indicate a possibility of a further rally in prices in the days ahead. According to the analysts the current upward rally is likely to find resistances at $ levels followed by $64-42, thereafter $649-5 and $660-6 areas. In case of a fall, supports are likely at $62-22 levels; $60-2 levels; $ levels and thereafter at $ levels. Xchange Communication: The next 2-day training session for DGCX members & representatives will be held on 6 th and 7 th ember. Members interested to participate may call the Training Department at or at training@dgcx.ae The Exchange shall introduce Spread trading facility in Gold & Silver futures contracts with effect from Friday, ember 8,. Spread trading facility will provide an opportunity for members to execute calendar spread contracts or roll over their positions from one expiry contract to another through a single order. Information on the same is also available on the FTP server & our website Members are requested to take a note of the same. Disclaimer: Xchange Newswire is intended for the purposes of education and information only and should not be construed under any circumstances either by implication or otherwise, as trading advice or any form of solicitation for purchase or sale of any commodity, derivative product or other investment product - whether or not traded on Dubai Gold & Commodities Exchange (DGCX). This document has been prepared on the basis of publicly available information, internally developed data and other sources believed to be reliable. While reasonable care has been taken during compilation of this document, DGCX holds no responsibility for any error or discrepancy in the information contained