MCX Gold April future fell by 1.56% on Tuesday tacking weak cues from international market - HDFC Securities
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BULLION
* MCX Gold April future fell by 1.56% on Tuesday tacking weak cues from international market. MCX gold future has corrected almost 3.0% from its all time high as short term traders took profit and cut their position before today’s Federal reserve meeting. Investor attention is zeroed in on whether the Fed will stick to its hawkish path to fight sticky inflation or pause interest rate hikes given recent trouble among banks which has included bankruptcy and last-minute rescues.
* Trading Strategy: MCX Gold April future, short term trend reversed on daily chart evening star candlestick pattern form which indicated correction will extend to 58080 level once price trade below 58500 level. Upside price face resistance at 59120. MCX Silver May future should consolidate in range of 67700 to 69080 either side break out will open new range for counter.
ENERGY
* MCX Crude Oil prices surged around 5.7% on Tuesday on back of short covering rally. Crude oil prices posted their biggest declines in months last week, after high-profile U.S. bank failures beginning March 10 and a crisis at Europe's Credit Suisse culminated in an emergency rescue over the weekend. Traders will be looking out for data from the U.S. Energy Information Administration on today to see whether it confirms signs of weaker crude demand.
* Trading Strategy: MCX Crude April future having strong resistance at 5840 until price cross this level long should avoid. If price cross this level, then rally will extend to 5980 level. Area around 5570 act as short term support. MCX Natural gas March future took support near 175level, if price break this support then it will correct further. Area around 195/205 are resistances for the day.
BASE METALS
* Base metals prices consolidated within range as traders awaited a decision on interest rates by the U.S. Federal Reserve due later in the day. The dollar index was little changed at 103.20 on Wednesday, having slid from a four-month high at 105.64 earlier this month. We expect base metals should follow the sideway trend and likely to trade with negative bias.
* Trading Strategy: MCX Copper March future has resistance at 765, if price cross this level then it will rally to 770/775 levels and having supports at 757/750. MCX Zinc March future should trade in range of 252.50 to 257 either side break out will open new range for the counters.
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