Gold futures traded sideways after forming a Doji, which is a sign of indecision. The key resistance exists around Rs 46,700 (8-day EMA). If we break above the top of the Doji along with 8-day EMA resistance at Rs 46,700, then it is likely that the market might move towards Rs 46,900 levels. On the downside, Rs 46,100 and Rs 45,900 levels hold key support for the day. Meanwhile, the strength index RSI (36) is hovering below 40, suggesting weakness in the trend. So going by the above evidence, it is expected that the price will move in the range of Rs 45,900-46,700 with a sideways bias. Only a close below Rs 45,900 would weaken the recovery and it would slip towards Rs 45,660.
Buy MCX Gold Oct at Rs 46,150. Target: Rs 46,700. Stop loss: Rs 45,900
MCX Silver prices breached the major support zone of Rs 62,000-62,200 and closed the day on a losing side. It erased all its gains and dented hopes of recovery. Resistance is seen near its 5-day EMA at Rs 63,200, followed by former support turned resistance at Rs 65,600. For the day, Rs 61,400-61,200 zone holds key support, which if held might push the price towards Rs 63,200. On the flip side, a move below Rs 61,200 would extend the weakness further towards Rs 60,400-60,000. Meanwhile, RSI is hovering in the oversold zone (23), which could limit the downside in price. So for the day, the price is expected to move in the range of Rs 60,400-63,200 with a sideways to weaker bias. Only a sustained move above Rs 63,200 could bring a relief rally in silver futures.
Trading Range: Rs 60,400-63,200
(Ravindra Rao is CMT , EPAT, VP-Head Commodity Research, Kotak Securities Ltd. Views are his own)
Tapan Patel
Here is a look at how different commodities are behaving in today’s market:
Outlook: Bullion
Bullion prices traded firm on Friday with spot gold prices at COMEX trading near $1,755 per ounce, while spot silver prices at COMEX trading marginally up at $23.24 per ounce in morning trade. The precious metals are fluctuating with minor recovery from “flash crash” on mixed global cues on Fed tapering expectations and rising COVID worries. The recent US CPI data and US infrastructure stimulus lent some support to ailing bullion prices. We expect bullion prices to trade sideways to up for the day.
Trading Strategy: MCX Gold October resistance for the day lies at Rs 46,700 per 10 gram with support at Rs 46,000 per 10 gram. MCX Silver September support lies at Rs 61,000 per kg, resistance at Rs 63,000 per kg.
Outlook: Crude Oil
Crude oil prices traded weak on Friday with benchmark NYMEX WTI crude oil prices trading over half a percent down near $68.62 per barrel in the morning trade. Crude oil prices traded lower on gloomy demand outlook with fast spreading virus infections. IEA lowered demand outlook saying that the fuel demand growth ground to a halt in July and is expected to slow down for the rest of 2021 due to the spread of COVID-19 cases involving the Delta variant globally. We expect crude oil prices to trade sideways to down for the day.
Trading Strategy: MCX Crude Oil August support lies at Rs 5,020 per barrel with resistance at Rs 5,170 per barrel.
Outlook: Base Metals
Base metals are trading weak on demand concerns from China with new COVID-19 restrictions on higher cases. Copper prices may limit downside on supply disruption fears. Nickel and aluminium prices may gain on higher demand prospects and pollution curbs in China. Base metals may trade sideways to up for the day.
Trading Strategy: MCX Copper August support lies at Rs 728 and resistance at Rs 736. MCX Zinc August support lies at Rs 245, resistance at Rs 252. MCX Nickel August support lies at Rs 1,460 with resistance at Rs 1,520.
(Tapan Patel is Senior Analyst (Commodities), HDFC Securities. Views are his own)
