Gold futures remained in a narrow range on Monday after last week’s sharp rally. The yellow metail is still hovering near its key resistance level at Rs 47,600 (200-DEMA). A breakthrough of the 200-DEMA would push it further higher towards the previous top at Rs 47,750, followed by Rs 47,900. Meanwhile, the bullish crossover of 8- and 50-DEMA has supported the bull case. The downside support holds around Rs 47,230, followed by Rs 46,900. The medium-term momentum has turned positive as the MACD index generated a crossover buy signal. So for the day, the price is expected to move in the range of Rs 47,230-47,750 with a sideways to higher bias. Only a close above Rs 47,750 would bring fresh buying interest in gold futures.
Trading Strategy: Buy MCX Gold Oct at Rs 47,250. Target price: Rs 47,750. Stop loss: Rs 47,000
MCX Silver futures also remained in a small range following US holiday on Monday. Meanwhile, the price is hovering around the 50-DEMA at Rs 65,550. A trade through the 50-DEMA would push it towards the key resistance of Rs 66,000 (200-DEMA), which could be the higher range for the day. On the downside, Rs 64,200 and Rs 62,900 levels hold the key support zone for the day. On the momentum front, RSI has moved above 50, which has strengthened the bull case. As long as Rs 62,900 holds, the price is expected to move towards Rs 66,000. Only a sustained move above Rs 66,000 would bring fresh buying interest.
Trading Strategy: Buy MCX Silver Dec at Rs 64,500. Target price: Rs 66,000. Stop loss: Rs 63,500
(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 steady on Tuesday with spot gold prices at COMEX near $1,822 per ounce while spot silver prices at COMEX trading marginally down near $24.62 per ounce in morning trade. The precious metals kept range-bound trading on Monday following Labour Day holiday. Mixed global cues post US non-farm payroll data has also kept bullion prices in range. The dollar index was trading around 0.10% up in morning trade. Bullion prices may trade sideways to up for the day supported by slower economic recovery and pandemic worries.
Trading Strategy: MCX Gold October resistance for the day lies at Rs 47,700 per 10 gram with support at Rs 47,100 per 10 gram. MCX Silver December support lies at Rs 63,500 per kg, resistance at Rs 66,200 per kg.
Outlook: Crude Oil
Crude oil prices traded weak on Tuesday with benchmark NYMEX WTI crude oil prices down 0.26% near $69.11 per barrel in morning trade. The gradual hike in OPEC plus production and price cuts by Saudi Arabia has flagged demand worries. More than 80% of oil production in the Gulf of Mexico is shut after a storm hit critical infrastructure in the region. We expect crude oil prices to trade sideways to down for the day.
Trading Strategy: MCX Crude Oil September support lies at Rs 4,980 per barrel with resistance at Rs 5,160 per barrel.
Outlook: Base Metals
Base metals traded weak in morning trade. Aluminium prices kept its upper trading range near 10-year highs. Aluminum traded near the highest since 2011 after a military coup in Guinea triggered uncertainty in a key part of the metal’s global supply chain. Copper prices traded under pressure with boost in supply from Chile. The Caserones mine owned by JX Nippon Mining & Metals signed a wage accord on Saturday, ending an almost month-long strike. Base metals may trade sideways to down for the day.
Trading Strategy: MCX Copper September support lies at Rs 708 and resistance at Rs 720. MCX Zinc September support lies at Rs 242 and resistance at Rs 248. MCX Aluminium September support lies at Rs 215 with resistance at Rs 220.
(Tapan Patel- Senior Analyst, Commodities, HDFC Securities. Views are his own)
