MCX Natural gas Feb is expected to rise back towards Rs.315-Rs.325 level as long as it stays above Rs.275 level - ICICI Direct
Metal’s Outlook
Bullion Outlook
* Spot Gold is likely to trade with negative bias amid recovery in dollar and rise in US treasury yields. Recent batch of economic data from US showed resilience in labor market giving space for US Federal Reserve to keep rates steady in near term. As per CME FedWatch tool market are pricing in 94% chance that Fed will leave rates unchanged at its next meeting. Meanwhile, sharp fall in prices would be cushioned amid rise in safe haven demand following escalating geopolitical tension in Middle East. Moreover, market anticipates that foreign investors will reroute their dollar assets into precious metal after Bloomberg reported that Chinese regulators have advised financial institutions to curb holdings of U.S. Treasuries because of concerns over concentration risks
* MCX Gold April is expected to slip back towards Rs.156,000-Rs.154,000 level as long as it stays below Rs.161,000 level.
* MCX Silver March is expected to slip towards Rs.250,000-Rs.240,000 level as long as it stays below Rs.271,000 level.
Base Metal Outlook
* Copper prices are expected to trade with negative bias amid recovery in dollar and weak global market sentiments. Further, prices may slip on signs of weak demand in China ahead of Lunar New Year holidays. Additionally, persistent rise in inventories at LME registered warehouses would hurt prices. Furthermore, Yangshan copper premium, which reflects Chinese appetite for imported copper, was at $34 a ton, still too low to indicate strong demand. Additionally, investors will remain cautious ahead of housing and jobless claims data from US to gauge economic health of the country and demand outlook
* MCX Copper Feb is expected to slip towards Rs.1230 level as long as it stays below Rs.1270 level. A break below Rs.1230 level prices may be pushed towards Rs.1210-Rs.1200 level
* MCX Aluminum Feb is expected to slip towards Rs.308 level as long as its stays below Rs.317 level. MCX Zinc Feb is likely to face stiff resistance near Rs.332 level and slip further towards Rs.325 level
Energy Outlook
* NYMEX Crude oil is likely to trade with positive bias amid lingering geopolitical tension in Middle East and Eastern Europe. Further, prices may rally on fears over supply disruption as tension between US and Iran escalates. Moreover, prices may move higher on reports that US may consider intercepting tankers carrying Iranian crude and may deploy additional carrier to the Middle East if the negotiation fails. Additionally, better than expected economic data from US signals resilience in economy supporting oil demand expectations. Meanwhile, sharp upside may be capped as API and EIA figures showed rise in crude oil stockpiles
* NYMEX Crude oil is likely to hold the support near $63.70 and rise further towards $66 level. MCX Crude oil Feb is likely to rise towards Rs.6000-Rs.6070 level as long as it stays above Rs.5800 level.
* MCX Natural gas Feb is expected to rise back towards Rs.315-Rs.325 level as long as it stays above Rs.275 level.
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