MCX Gold futures consolidated and closed with marginal gains on Monday. Prices remained below the 20- and 50-DEMA (Rs 47,300) which could act as a key resistance zone. Oct futures contract hit the lower Bollinger band near Rs 46,730 and witnessed a quick recovery. However, price is still hovering below the midline of the band suggesting a correction phase. The key support holds around Rs 46,700, followed by Rs 46,480. Similarly, resistance exists around Rs 47,300. The momentum oscillator RSI (45) has moved below 50, indicating weakness. On the other hand, the rebound in fast stochastic from the oversold territory has negated the bearish bets. So for the day, the price is expected to move in the range of Rs 46,700-47,300 with a sideways bias. Only a close above Rs 47,300 would extend the rebound towards the next key resistance at Rs 47,600.
Trading Range: Rs 46,700-47,300
MCX Silver Dec futures witnessed a good rebound to settle above Rs 63,000, after its earlier decline towards the key support near Rs 62,400. Meanwhile, its 20-day EMA (Rs 64,000) is the key resistance. If price manages to settle above this level, it will lead towards the next resistance at Rs 65,500, followed by Rs 66,000. On the downside, immediate support exists around Rs 62,400, which is the key level for the day. A move below would weaken the trend again and push the price towards Rs 61,800-61,200 zones. On the momentum front, RSI is hovering near 43, suggesting a sideways to weaker bias. So for the day, the price might consolidate in the band of Rs 62,400-64,000. Only a sustained move above Rs 64,000 would bring fresh buying interest in silver futures and push it towards Rs 65,500.
Trading Range: Rs 62,400-64,000
(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 flat near $1,792 per ounce while spot silver prices at COMEX were marginally down near $23.67 per ounce in morning trade. Precious metals are trading in a narrow trading range. Gold prices are capped below $1,800 on mixed fundamentals and US Fed tapering expectations. Global players are awaiting for US inflation data on Tuesday which may raise speculation of timing of Fed’s asset purchase unwinding. Bullions prices may trade sideways to up for the day.
Trading Strategy: MCX Gold October resistance for the day lies at Rs 47,200 per 10 gram with support at Rs 46,700 per 10 gram. MCX Silver December support lies at Rs 62,000 per kg, resistance at Rs 64,500 per kg.
Outlook: Crude Oil
Crude oil prices traded higher on Tuesday with benchmark NYMEX WTI crude oil prices up 0.62% near $70.89 per barrel in morning trade. Crude oil prices continued its upside as the US Gulf Coast continues to recover from the damage caused by hurricane Ida while the region is bracing for another storm. Tropical storm Nicholas is headed towards Texas and Louisiana, with evacuations underway from offshore US Gulf of Mexico oil platforms. We expect crude oil prices to trade sideways to up for the day.
Trading Strategy: MCX Crude Oil September support lies at Rs 5,160 per barrel with resistance at Rs 5,290 per barrel.
Outlook: Base Metals
Base metals were weak in morning trade with negative openings in most of the metals. Copper prices traded lower on ease of supply tensions in Chile over possible labour strike. Aluminium prices extended gains as prices at LME touched $3,000 per tonne for the first time in 13 years on lower supply and higher demand. Yunnan province, one of the largest aluminum producing provinces in China, will enforce production curbs from this month in an effort to meet energy intensity reduction goals. Base metals may trade sideways to down for the day following stronger dollar and weak Chinese cues.
Trading Strategy: MCX Copper September support lies at Rs 720 and resistance at Rs 738. MCX Zinc September support lies at Rs 249, resistance at Rs 255. MCX Aluminium September support lies at Rs 225 with resistance at Rs 232.
(Tapan Patel is Senior Analyst, Commodities, HDFC Securities. Views are his own)
