Copper prices are likely to remain range bound ahead of key central bank policies and ongoing geopolitical uncertainty - ICICI Direct
Metal’s Outlook
Bullion Outlook
• Spot Gold is expected to hold the support near $3375 and move towards $3450 amid safe haven buying. US President Donald Trump called for full evacuation of Tehran amid ongoing air strikes. Meanwhile, efforts from Iran to deescalate tension with Israel and push for nuclear talks with US could ease safe haven demand. All focus will remain on Iran and US. Furthermore, investors will focus on this week’s FOMC policy and today’s US retail sales numbers.
• Spot gold is expected to remain volatile and move in the band of $3375 and $3450. Only a move below $3375 it would turn weaker. MCX Gold Aug is expected to move in the band of Rs 98,500 and Rs 101,100 level. A move below Rs 98,500 would bring further correction in price towards Rs 97,500 mark
• MCX Silver July is expected to rise towards Rs 107,400 level, as long as it holds above Rs 104,000 level. Only below Rs 104,000, it would turn bearish
Base Metal Outlook
• Copper prices are likely to remain range bound ahead of key central bank policies and ongoing geopolitical uncertainty. Meanwhile, sluggish industrial demand from China would likely to restrict its upside. Additionally, drop in Yangshan Copper premium to its lowest over a month indicates prices to remain under pressure. On the other hand softer dollar and increasing refined copper demand from US could provide support to prices.
• MCX Copper June is expected to move in the band of Rs 868 and Rs 882 level. A move above Rs 882, would open the downside towards Rs 890.
• MCX Aluminum June is expected to hold support near Rs 239 and rebound towards Rs 244 level. MCX Zinc June is likely to face resistance near Rs 253 level and move in the range of Rs 249 and Rs 253 level. A move above Rs 253, would open the doors towards Rs 256.
Energy Outlook
• Crude oil is likely to remain volatile amid ongoing geopolitical tenson in the Middle East. Prices may face hurdle near $75 mark as the recent attacks didn’t hamper the oil supplies from the region. But haziness over nuclear talk between US and Tehran would bring uncertainty and limit its downside. Meanwhile, weaker set of economic numbers from US and China could restrict any major upside in oil price.
• On the data front , strong put base at $65 strike suggest good support. On the upside key hurdle is at $75 mark. Addition of OI in ATM and OTC call strike indicates prices to face strong resistance and correct towards $68 mark. MCX Crude oil July is likely to face resistance at Rs 6350 and move lower towards Rs 5950 level.
• MCX Natural gas June is expected to move higher towards Rs 328 as long as it holds above Rs 308 mark. A move above Rs 328, would open the doors towards Rs 338. Forecast of hotter weather in US would increase cooling demand
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