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Gold

Gold prices declined by 0.26% to settle at ?79,023 as markets anticipated policy shifts under the incoming Trump administration. However, losses were capped by softer-than-expected U.S. inflation data, which renewed hopes for multiple Federal Reserve rate cuts. Core inflation data raised expectations of at least two rate cuts by year-end, with Fed Governor Christopher Waller suggesting the possibility of three to four cuts if economic data deteriorates further. The U.S. manufacturing sector showed strength, with output rising 0.6% in December, surpassing market expectations of 0.2%. Meanwhile, gold demand in India weakened as domestic prices surged, leading to discounts reaching six-month highs of $30 per ounce, compared to $17 last week. Jewellers in India are awaiting the federal budget for clarity on policy changes. In contrast, physical gold demand in China remained robust ahead of the Lunar New Year, with premiums ranging from $3 to $13 per ounce, up from last week’s discounts of $2. Singapore and Hong Kong also reported stable premiums, while Japan saw trades fluctuate between a $0.5 discount and premium. Central banks continued driving gold demand, with global purchases totaling 53 tonnes in November. The National Bank of Poland led with a 21-tonne addition, followed by the Reserve Bank of India’s 8-tonne increase. Gold saw long liquidation as open interest declined by 3.38%. Support is at ?78,785, with further testing possible at ?78,550. Resistance lies at ?79,225, with a breakout potentially reaching ?79,430. Price movement may hinge on central bank policies and macroeconomic data.
 

Trading Ideas:
* Gold trading range for the day is 78550-79430.
* Gold eases as investors anticipate a wave of policy changes under the incoming Trump administration.
* U.S. inflation data and Fed comments revived hopes the bank might cut interest rates more than once this year.
* U.S. data showed softer than expected core inflation, raising bets on a Fed rate cut.

Silver

Silver prices dropped by 1.29% to ?91,602, pressured by strong economic data from the U.S. that underscored the economy's resilience. Investor sentiment was mixed as the Federal Reserve hinted at potential rate cuts amid easing inflation. Fed Governor Christopher Waller noted inflation was nearing the Fed's 2% target, while Cleveland Fed President Beth Hammack maintained concerns about persistent inflation. These mixed signals tempered optimism for a dovish Fed stance. The IMF projected global growth at 3.3% for 2025, slightly up from 3.2%, with an upward revision for the U.S. offsetting weaker expectations for other economies. For 2026, growth is expected to remain steady at 3.3%. Despite U.S. economic strength, heightened policy uncertainty continues to pose risks for other nations. The global silver market remains in a structural deficit for the fourth consecutive year, with a projected shortfall of 182 million ounces in 2024, according to the Silver Institute. Demand is expected to reach 1.21 billion ounces, driven by record industrial use and recovering jewelry consumption, despite a 16% dip in physical investment. Supply is forecasted to rise by 2%, supported by increased mining in Mexico, Chile, and the U.S., alongside a 5% recycling uptick from western silverware scrap. Silver witnessed long liquidation, with open interest marginally down by 0.01%. Support is at ?90,970, with further downside testing possible at ?90,340. Resistance is seen at ?92,430, with a breakout potentially leading to ?93,260.
 

Trading Ideas:
* Silver trading range for the day is 90340-93260.
* Silver dropped as strong economic data highlighting the resilience of the US economy.
* The IMF projects global growth of 3.3% for 2025, a slight increase from the 3.2% forecast in October.
* Fed Governor Christopher Waller said three or four cuts could be possible if U.S. economic data weakens further.

Crude oil

Crude oil prices declined by 0.59% to settle at ?6,720 amid speculation about potential changes in U.S. sanctions on Russian energy under the Trump administration and reports of a ceasefire in the Middle East. While these developments eased geopolitical risk premiums, the market remained supported by U.S. sanctions on Russian energy flows, declining crude inventories, and seasonal heating fuel demand. U.S. crude inventories dropped for the eighth consecutive week, falling by 1.961 million barrels, exceeding the forecast of 1.6 million barrels. However, stocks at the Cushing, Oklahoma delivery hub rose by 0.765 million barrels. Gasoline and distillate inventories surged by 5.852 million and 3.077 million barrels, respectively, indicating robust refinery activity. On the global front, the EIA revised its forecast for record U.S. oil production to 13.55 million barrels per day in 2025, up from the previous estimate of 13.52 million bpd. Meanwhile, global production is expected to average 104.4 million bpd in 2025, outpacing demand projected at 104.1 million bpd. China’s December crude oil production grew 1.4% year-on-year, while annual output rose 1.8%.Crude oil experienced fresh selling, with open interest rising sharply by 79.71% to 8,824 contracts. Support is seen at ?6,670, with further downside possible to ?6,620. Resistance is now likely at ?6,793, with a break above potentially testing ?6,866.
 

Trading Ideas:
* Crudeoil trading range for the day is 6620-6866.
* Crude oil dropped due to speculation that President-elect Trump might ease sanctions on Russian energy exports.
* Reports of a ceasefire in the Middle East have also reduced the geopolitical risk premium.
* EIA slightly lifted its estimate for record U.S. oil production this year, to 13.55 mbpd, from its prior estimate of 13.52 million bpd.

Natural gas

Natural gas prices fell by 3.26% to settle at ?344.7, driven by projections of milder weather across late January and early February, which is expected to reduce heating demand. U.S. utilities withdrew 258 billion cubic feet (bcf) of natural gas from storage in the week ending January 10, bringing total stockpiles to 3,115 bcf, aligning with market expectations. This marked the ninth consecutive inventory draw, narrowing the surplus over the five-year average to 2.5% and pushing stockpiles 3.4% below year-ago levels. Despite the withdrawal, U.S. storage remains about 3% above the seasonal average, though continued draws could erase this surplus by month-end. Freeze-offs in the Lower 48 states curtailed output, which dropped to 103.4 bcf per day in January from December’s record 104.5 bcf per day. Meanwhile, China's natural gas production increased 3.6% year-on-year in December, with annual output up 6.2% to 246.4 billion cubic meters. Looking ahead, the U.S. Energy Information Administration (EIA) projects record gas production and demand for 2025, with output expected to rise to 104.5 bcf per day and LNG exports reaching 14.1 bcf per day. However, demand is forecasted to decline slightly in 2026, marking the first drop since 2020. Natural gas witnessed long liquidation, with open interest dropping by 22.88% to 11,046 contracts. Support is at ?334.8, with further downside to ?325. Resistance is expected at ?361.6, with potential upside to ?378.6.
 

Trading Ideas:
* Naturalgas trading range for the day is 325-378.6.
* Natural gas dropped on forecasts for milder weather in late January and early February.
* US utilities withdrew 258 bcf of natural gas from storage, reducing total stockpiles to 3,115 bcf
* Average gas output fell from 104.2 bcfd in December to 103.4 bcfd so far in January.


Copper

Copper prices fell by 0.58%, closing at ?832.8, as inventories monitored by the Shanghai Futures Exchange rose 12.9% from last week, indicating weaker demand. Concerns over China's economic outlook added to the pressure, with muted purchasing levels by Chinese manufacturers extending into 2024. While China’s economy grew by 5% in 2023, the growth remained unbalanced, driven by industry and exports, leaving uncertainties for 2025 amid potential U.S. tariffs. On a brighter note, China’s industrial output and imports of unwrought copper rose significantly in December. Imports surged by 17.8% year-on-year to 559,000 metric tons, signaling restocking by refiners amid increased orders. Globally, the refined copper market showed a deficit of 41,000 metric tons in October, down from a 136,000 metric tons deficit in September, as per the International Copper Study Group (ICSG). However, for the first ten months of 2024, the market posted a surplus of 287,000 metric tons, reflecting a shift in supply dynamics. Chile's Antofagasta reported a modest 1% rise in 2024 copper production to 664,000 metric tons, below its guidance range, citing lower grades despite strong output at flagship projects. For 2025, the company maintained its production forecast between 660,000-700,000 tons. Copper faced long liquidation, with open interest dropping by 1.9% to 4,708 contracts. The support is at ?827.5, with further downside to ?822. Resistance is pegged at ?839.7, and a break above could lead prices to test ?846.4.
 

Trading Ideas:
* Copper trading range for the day is 822-846.4.
* Copper dropped as Shanghai warehouse copper stocks up 12.9%
* China's economy grew 5% last year, matching the government's target, but growth was unbalanced, led by industry and exports.
* Data showed that China’s industrial output rose much more than expected in December

Zinc

Zinc prices rose by 1.28% to close at ?277.6, supported by dwindling inventories and supply concerns. LME zinc stocks hit their lowest levels since February 2024, while Shanghai Futures Exchange zinc inventories dropped by 1.4% from last week. Production halts at two Australian zinc mines further fueled supply fears. MMG Ltd.’s Dugald River mine in Queensland temporarily suspended operations due to an approaching bushfire, although production is expected to resume within 48 hours with minimal impact on annual output. The global zinc market remains under pressure, with a deficit of 69,100 metric tons in October, up from 47,000 tons in September, according to the International Lead and Zinc Study Group (ILZSG). This reflects a tightening supply scenario driven by a 3.8% decline in global mine production during the first ten months of 2024, with output from Canada, China, South Africa, and Peru notably affected. The ILZSG has revised its 2024 zinc market outlook, predicting a 164,000-ton deficit compared to an earlier forecast of a 56,000-ton surplus. On the demand side, signs of recovery in China’s industrial output and credit aggregates point to the positive impact of monetary stimulus measures. However, refined zinc production in China grew moderately, supported by incremental increases from maintenance recovery and new production in Shanxi, with expectations for a 15,000-ton rise in January 2025. Zinc saw short covering, with open interest falling by 20.98% to 1,748 contracts. Support is seen at ?275.4, with further downside to ?273.1. Resistance is likely at ?278.9, and a break above this level could test ?280.1.
 

Trading Ideas:
* Zinc trading range for the day is 273.1-280.1.
* Zinc gains supported by continuing decline of LME inventories, lowest since February 2024
* Zinc inventories in warehouses monitored by the Shanghai Futures Exchange fell 1.4% from last Friday.
* BMI projects global refined zinc consumption grew by 2.2% year-on-year in 2024 and will grow by another 1.7% year-on-year in 2025.


Aluminium

Aluminium prices rose by 1.39% to close at ?256.05, supported by expectations of reduced supply and improving demand prospects. The European Union's plan to sanction imports of Russian primary aluminium under its 16th sanctions package has fueled concerns about tighter supply. Manufacturers had already limited purchases of Russian aluminium following the country’s invasion of Ukraine in 2022. Supply concerns were exacerbated by dwindling inventories in LME-registered warehouses, which have dropped by 45% since May 2024 to 619,375 tons. With cancelled warrants near 60%, additional outflows from warehouses are expected in the coming weeks, further tightening availability. The premium for cash aluminium over the three-month contract narrowed significantly to $13 per ton from over $40 in December, reflecting these supply constraints. On the other hand, global aluminium production remains on an upward trajectory, with December output likely surpassing 6 million tons globally for the first time. China's December aluminium production rose by 4.2% year-on-year to 3.77 million metric tons, bolstered by expanded capacity in Xinjiang. However, daily output dipped slightly by 1.7% from November. For the full year, China's production increased by 4.6% to 44.01 million tons, although profit margins turned negative, with producers facing average losses of 687 yuan per ton due to higher costs. Aluminium witnessed short covering as open interest declined by 2.87% to 2,373 contracts. Immediate support is seen at ?254, with a potential downside to ?251.9. Resistance is likely at ?257.3, and a break above this level could test ?258.5.
 

Trading Ideas:
* Aluminium trading range for the day is 251.9-258.5.
* Aluminum rose supported by expectations of lower supply from key producers and respite for demand.
* The EU was set to sanction the import of primary aluminum from Russia in its upcoming package.
* China's aluminium production rose by 4.2% to 3.77 million metric tons in December from a year earlier.

Cottoncandy

Cottoncandy prices declined by 0.15% to ?54,220, following the latest WASDE report projecting an increase in global cotton production and ending stocks for the 2024/25 crop year. Global production is estimated to rise by 1.2 million bales to 117.4 million bales, driven by higher output in India and Argentina. Despite this, India faces challenges in northern states like Punjab, Haryana, and Rajasthan, where kapas arrivals have dropped 43% year-on-year, leading to supply chain disruptions. Farmers are holding back produce for better prices, causing raw material shortages for ginners and spinners, especially in Punjab. Cotton yarn prices in South India have risen, supported by robust demand from the garment industry and strong export orders. For the 2024/25 season, the Cotton Association of India (CAI) maintains cotton consumption at 313 lakh bales and pressing estimates at 302.25 lakh bales. Imports are projected to increase significantly, reaching 25 lakh bales, up from 15.2 lakh bales last year, adding further pressure to domestic supplies. Meanwhile, U.S. cotton production has been revised upwards to 14.3 million bales, contributing to higher global stocks. Cottoncandy is undergoing long liquidation, with open interest declining by 1.25%. Immediate support is at ?54,090, and a breach below could lead to ?53,970. Resistance is seen at ?54,340, and a move above this level could test ?54,470.
 

Trading Ideas:
* Cottoncandy trading range for the day is 53650-54410.
* Cotton dropped as WASDE report projected higher production and ending stocks for the 2024/25 crop year.
* India's cotton production in 2024/25 is likely to fall by 7.4% from a year ago
* Cotton production is projected to increase in China, Brazil, and Argentina, more than offsetting reductions in the US and Spain – USDA
* In Rajkot, a major spot market, the price ended at 25734.35 Rupees dropped by -0.36 percent.

Turmeric

Turmeric prices dropped by 1.35%, settling at ?14,024 as harvesting began in Karnataka and Andhra Pradesh, with Telangana expected to follow post-Makar Sankranti. However, downside pressure remains limited due to concerns over slow rhizome growth and low yield estimates. Farmers have indicated potential lower yields, which require close monitoring as the harvesting season progresses. With the arrival of the new crop expected to increase after Makar Sankranti, market supply is anticipated to rise, influencing future price trends. Supply has significantly decreased in the Erode-Warangal line, while pending deliveries in the futures market and unavailability of corresponding stock in physical markets further support price firmness. The new crop is not expected before April, and adverse weather conditions, including the effects of El Niño, could limit production. On the demand side, international prices remain high, and domestic consumption is expected to rise. In the previous year, production stood at 68–70 lakh bags, while consumption reached 128 lakh bags, leaving old stock nearly depleted by the time the new crop arrives. Export data remains robust, with shipments during April–October 2024 increasing by 6.57% to 108,879.96 tonnes compared to the same period in 2023. Exports in October 2024 rose by 57.22% year-on-year, highlighting strong international demand. The market is under long liquidation, with open interest dropping by 1.78%. Turmeric prices are finding support at ?13,872, and a break below this could test ?13,718. Resistance is seen at ?14,310, with potential for prices to reach ?14,594 if breached.
 

Trading Ideas:
* Turmeric trading range for the day is 13718-14594.
* Turmeric dropped as harvesting has commenced in Karnataka and Andhra Pradesh and is expected to commence in Telangana.
* However downside seen limited amid concerns over slow growth of rhizomes and low yield estimates persist.
* With the arrival of new crop likely to increase after Makar Sankranti, supply is expected to increase.
* In Nizamabad, a major spot market, the price ended at 13825.25 Rupees dropped by -1.2 percent.

Jeera

Jeera prices declined by 0.58%, settling at ?22,225, as subdued demand continues to weigh on the market. The export demand is being met from existing stock, and farmers still hold around 20 lakh bags of cumin. With only 3-4 lakh bags likely to be traded by the season’s end, a carry-forward stock of approximately 16 lakh bags is expected. Production for the current season is estimated to remain steady at 8.6 lakh tonnes, as favorable crop conditions and good sowing have supported yields. Despite the price decline, the downside remains limited due to overall stock shortages. Indian cumin remains the cheapest globally, priced at $3,050 per tonne, significantly lower than Chinese cumin by $200–250. This price competitiveness is expected to attract global buyers, particularly from China, supporting the market. Tensions in the Middle East have boosted demand for Indian cumin, with strong interest from Europe and other regions due to the festive season. Exports for April–October 2024 rose sharply by 77.37% to 135,450.64 tonnes compared to the same period in 2023. October 2024 exports surged 161.04% year-on-year to 16,257.44 tonnes, reflecting robust international demand. The market witnessed fresh selling, with open interest increasing by 4.37%. Prices are finding support at ?22,030, with a break below this level potentially testing ?21,820. On the upside, resistance is seen at ?22,550, and a move above this could lead to testing ?22,860.
 

Trading Ideas:
* Jeera trading range for the day is 21820-22860.
* Jeera dropped as demand is low and the current export business is being met from the available stock.
* However downside seen limited amid shortage of stocks is contributing.
* The current season is expected to have similar production levels as last year due to better crop conditions and good sowing.
* In Unjha, a major spot market, the price ended at 23282.85 Rupees gained by 0.07 percent.

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