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GOLD

Gold prices saw a modest 0.2% increase, closing at 61,280, driven by safe-haven demand due to the Middle East conflict. Additionally, investors were eagerly awaiting the U.S. Federal Reserve's policy meeting. Tensions in the Middle East escalated as Israeli troops and tanks attacked Gaza's main northern city from multiple directions. The focus of market participants was on the upcoming U.S. Federal Reserve policy decision, scheduled for the week. While interest rates were expected to remain unchanged, the crucial element was Chair Jerome Powell's commentary, which held the potential to influence markets. In India, physical gold purchases improved during a major festival, although the growth rate was slower than the previous year due to near-record domestic prices. In China, premiums over global spot prices decreased, with dealers offering a discount of up to $5 per ounce over official domestic prices. China's net gold imports via Hong Kong fell by nearly 11% in September, reflecting a decline from August. From a technical standpoint, the market experienced fresh buying, with open interest increasing by 1.47% to reach 14,998. Prices rose by 124 rupees. Support for gold was observed at 61,125, with potential testing at 60,975 if it falls below this level. On the upside, resistance was expected around 61,410, and surpassing this level could lead to prices testing 61,545.

Trading Ideas:

* Gold trading range for the day is 60975-61545.
* Gold prices gained supported by safe-haven demand amid the Middle East conflict.
* Israeli forces attack north Gaza's main city from both sides
* U.S. Fed is expected to keep rates on hold this week
 

SILVER

Silver prices surged by 1.45%, closing at 72,755, primarily due to increased demand for safe-haven assets. This was triggered by Israel's ground war in Gaza, leading to heightened geopolitical concerns. Furthermore, China's stimulus efforts and a weaker dollar, buoyed by positive European economic data, provided support for silver. Investor attention has now shifted to the upcoming Federal Reserve meeting, where they seek guidance for the future. While the Fed is expected to pause interest rate hikes, they are likely to keep rates relatively high, which could impact silver's attractiveness. In Europe, the European Central Bank's tightening cycle seemed to be ending. The U.S. dollar slowed down ahead of the Federal Reserve meeting, which is expected to provide insights into the future of U.S. interest rates. Despite recent interest rate hikes, the U.S. economy has remained strong and resilient. Chinese economic data indicated a recovery driven by government spending and financial support, potentially boosting actual demand. German consumer price inflation declined to 3.8% year-on-year in October, slightly below market expectations. Euro Area services confidence rose in October, surpassing consensus. From a technical perspective, the market experienced short covering, with open interest decreasing by -13.15% to 16,864. Prices rose by 1,038 rupees. Silver found support at 71,930, with a potential test of 71,110 if it drops below this level. Resistance was expected around 73,480, and breaking above it could lead to a test of 74,210.

Trading Ideas:

* Silver trading range for the day is 71110-74210.
* Silver rose lifted by increased demand for safe-haven assets, as Israel launched its anticipated ground war in Gaza
* The dollar slowdown ahead of the Fed’s policy meeting, which could provide more clues on the future path for US interest rates.
* The US economy recently proved resilient and strong despite the successive interest rate hikes in the past two years.
 

CRUDE OIL

Crude oil prices dipped by -3.48% to $68.80 a barrel as concerns in the Middle East temporarily eased. Israel's expansion of ground operations in Gaza raised concerns, but these have subsided for now. Investors are now looking to a busy week of economic data and central bank meetings. Key monetary policy decisions are expected from the Fed, BoJ, and BoE, along with crucial economic data from China and the US, which will impact demand prospects. The World Bank anticipates global oil prices to average $90 a barrel in the fourth quarter, with a decline to an average of $81 in 2023 due to slowing economic growth reducing demand. However, the World Bank warns that an escalation in the Middle East conflict could significantly spike oil prices higher. Despite the geopolitical tensions, oil prices have risen only modestly since the Israel-Hamas conflict began, in contrast to other commodities. The U.S. Energy Information Administration has lowered its 2024 world oil demand growth forecast and reduced the estimate for 2023 due to uncertainties in the market. From a technical perspective, the market indicates fresh selling as open interest surged by 49.17% to settle at 5,986 contracts. Crude oil now finds support at $67.85, and a breach of this level could test $66.90. On the upside, resistance is expected at $70.21, with potential price testing at $71.62 if this level is surpassed.

Trading Ideas:

* Crudeoil trading range for the day is 6690-7162.
* Crude oil dropped as Middle East worries eased, and investors looked ahead to a busy week of economic data
* World Bank said it expected global oil prices to average $90 a barrel in the fourth quarter, and to drop to an average of $81 a barrel over next year
* US EIA cuts 2024 world oil demand growth forecast
 

NATURAL GAS

Natural gas prices experienced a sharp decline of -5.31% to settle at 279.7 due to record output levels and revised weather forecasts predicting milder conditions and reduced heating demand for the upcoming week. The latest data from the EIA indicated that US utilities added 74 billion cubic feet of gas to storage, falling slightly short of market expectations but exceeding the five-year average. LSEG reported a notable increase in gas production, reaching an average of 104.1 billion cubic feet per day in October, compared to 102.6 bcfd in September and a record high of 103.1 bcfd in July. Meteorologists expect a shift from colder-than-normal weather to near-normal conditions between Nov. 3-14. This change in weather patterns prompted LSEG to forecast a decrease in US gas demand in the Lower 48 states, including exports, from 109.2 bcfd this week to 104.2 bcfd next week. Additionally, pipeline exports to Mexico decreased from the previous month, while gas flows to major US LNG export plants increased in October, although they remained below previous highs. From a technical standpoint, the natural gas market witnessed a surge in open interest by 30.36%, settling at 17,721, while prices saw a decline of -15.7 rupees. Support for natural gas is expected at 273.8, with a potential test of 267.8 if this level is breached. Resistance is anticipated at 289.4, and a breakthrough could lead to price testing 299.

Trading Ideas:

* Naturalgas trading range for the day is 267.8-299.
* Natural gas fell on record output and forecasts for milder weather and lower heating.
* The latest data from the EIA showed that US utilities added 74 billion cubic feet of gas into storage
* Average gas output in the Lower 48 U.S. states rose to an average of 104.1 billion cubic feet per day (bcfd) so far in October

 

COPPER

Copper prices edged up by 0.25% to 708.6, driven by expectations of strong demand and inventory reductions. Beijing's decision to increase its budget by CNY 1 trillion for manufacturing investments boosted industrial input buying and alleviated concerns about low demand from the residential construction sector. Notably, stock levels at the Shanghai Futures Exchange and London Metal Exchange dropped by almost 40% in the week ending October 27th, erasing earlier gains. This decline coincided with a rise in the Yangshan copper premium, indicating increased demand for physical copper deliveries in Asia. The International Copper Study Group reported a 33,000 metric ton deficit in the global refined copper market for August, up from 30,000 metric tons in July. However, the year-to-date balance shifted from a 313,000 metric ton deficit to a 99,000 metric ton surplus compared to the same period last year. World refined copper output in August was 2.25 million metric tons, while consumption reached 2.28 million metric tons. Adjusting for inventory changes in Chinese bonded warehouses, there was a 34,000 metric ton deficit in August, compared to a 39,000 metric ton deficit in July. From a technical perspective, copper experienced short covering, with a drop in open interest by -8.76% to 6604 while prices increased by 1.8 rupees. Support is expected at 706, with a potential test of 703.4 if this level is breached. Resistance is likely at 712.2, with a breakthrough possibly leading to prices testing 715.8.

Trading Ideas:

* Copper trading range for the day is 703.4-715.8.
* Copper rose amid expectations of robust demand and fresh blows to inventories.
* Data showed that stocks at the Shanghai Futures Exchange and the London Metal Exchange plummeted by nearly 40%.
* The decline aligned with a fresh jump in the Yangshan copper premium, signaling higher demand for physical deliveries in Asia.
 

ZINC

Zinc prices saw a slight decline of -0.11% to settle at 221.4, despite China's efforts to stimulate its economy with increased budget deficit ratios and sovereign debt injection. Reduced production in Europe and Australia due to high energy costs provided some support, but zinc has remained down by 20% since the year's beginning, primarily due to supply surpassing demand. The International Lead and Zinc Study Group reported a shift from an expected zinc deficit to a surplus of 248,000 metric tons this year, driven by lower-than-anticipated demand. Global refined zinc demand for 2023 is now predicted to increase by 1.1% to 13.59 million tons, slightly lower than the April estimate due to tighter monetary conditions. In September 2023, China's refined zinc output increased by 3.31% month-on-month and 7.94% year-on-year, totaling 544,000 metric tons. However, this growth fell slightly below expectations. Cumulative refined zinc output from January to September reached 4.85 million metric tons, marking a 9.84% year-on-year increase. Domestic zinc alloy production in September rose to 88,200 metric tons, up by 2,000 metric tons compared to the previous month. From a technical standpoint, the zinc market experienced fresh selling, with a 2.64% increase in open interest to settle at 3699, while prices declined by -0.25 rupees. Support is expected at 220.7, with a potential test of 220 if this level is breached. Resistance is likely at 222.2, with a breakthrough possibly leading to prices testing 223.

Trading Ideas:

* Zinc trading range for the day is 220-223.
* Zinc settled down despite renewed stimulus measures for China
* Reduced production from Europe and Australia due to high energy costs supported the positive momentum.
* The global refined zinc market was headed for a surplus of 248,000 metric tons this year

 

ALUMINIUM

Aluminium prices gained 0.75% to settle at 207, benefiting from China's economic support measures and robust demand. China's industrial profits saw a second consecutive monthly increase in September, signaling a stabilizing economy. Chinese lawmakers approved 1 trillion yuan in bonds for disaster-affected regions, boosting the need for metals in construction. China's domestic aluminium production for September 2023 reached 3.523 million metric tons, up 5.5% year-on-year, with daily production averaging around 117,400 metric tons. Cumulative production from January to September 2023 stood at 30.822 million metric tons, a 3.13% year-on-year increase. Aluminium billet plants and downstream enterprises reported stable operations, and some plants adjusted alloying ratios upward. Additionally, China expanded its aluminium operating capacity, mainly due to capacity transfer projects in regions like Yunnan and Guizhou. Minor maintenance and capacity changes occurred in other areas, resulting in a total installed capacity of approximately 45.19 million metric tons by the end of September. From a technical standpoint, short covering took place in the aluminium market, with open interest declining by -1.67% to settle at 3174, while prices increased by 1.55 rupees. Support is anticipated at 205.8, with a potential test of 204.7 if this level is breached. Resistance is likely at 207.6, with a breakthrough possibly leading to prices testing 208.3.

Trading Ideas:

* Aluminium trading range for the day is 204.7-208.3.
* Aluminium gains as supportive economic measures from China boosted sentiment
* Profits at China's industrial firms extended gains for a second month in September
* Chinese lawmakers last week approved 1 trillion yuan worth of bonds to reform disaster-hit areas
 

COTTONCANDY

Cottoncandy experienced a decline of -0.54% to settle at 58,700 due to profit booking, following a rise triggered by the USDA's October WASDE report. The report cut U.S. cotton production for 2023/24 to 12.8 million bales, citing lower yields in Texas. Interestingly, Brazil's cotton production is expected to surpass that of the United States for the first time, and Brazil is close to outdoing U.S. cotton exports for the first time since the 19th century. Australia saw a surge in cotton exports to China in August, reaching 61,319 metric tons worth $130 million, taking advantage of improved trade relations. In India, the Cotton Association increased its estimate for the 2022-23 season to 31.8 million bales, up from its earlier estimate of 31.1 million bales but lower than government estimates. The 2023-24 cotton season in India is anticipated to yield between 33 to 34 million bales. Cotton area in Telangana decreased due to unfavorable seasonal conditions. Cotton picking is set to gain momentum in the state around the second or third week of November, with expectations of normal rainfall. In Rajkot, a significant spot market, cotton prices ended at 27,685.8 Rupees, down by -0.23%. From a technical standpoint, the market experienced long liquidation, with open interest remaining unchanged at 108 and prices dropping by -320 rupees. Support for Cottoncandy is at 58,600, with the possibility of testing 58,490, while resistance is likely at 58,820, with potential testing at 58,930.

Trading Ideas:

* Cottoncandy trading range for the day is 58490-58930.
* Cotton dropped on profit booking after prices rose as USDA cut U.S. production in 2023/24 to 12.8 million bales
* The USDA also said Brazil's cotton production in 2023/24 will exceed that of the United States for the first time
* Australia's exports of cotton to China ballooned to 61,319 metric tons worth $130 million in August
* In Rajkot, a major spot market, the price ended at 27685.8 Rupees dropped by -0.23 percent.
 

TURMERIC

Turmeric prices saw a rise of 1.33% to settle at 13,708 due to concerns about potential yield losses caused by unfavorable October weather conditions. However, this upward movement is limited by improved crop conditions resulting from favorable weather, with harvest expected between January and March. The IMD forecasts drier-than-average conditions for October, impacting crop growth. Despite these challenges, current buying activity and decreasing supplies are stabilizing prices. Additionally, export opportunities have improved, with a 25% increase in turmeric exports, driven by growing demand in both developed and emerging markets. Expectations of a 20-25% decline in turmeric seeding this year, particularly in regions like Maharashtra, Tamil Nadu, Andhra Pradesh, and Telangana, reflect shifting priorities among farmers. Turmeric exports from April to August 2023 rose by 11.51% compared to the same period in 2022, while August 2023 saw a drop of 18.20% compared to July 2023, and a 6.67% decrease compared to August 2022. In the Nizamabad spot market, turmeric prices ended at 13,502.25 Rupees, gaining 0.56%. From a technical perspective, the market witnessed short covering, with a drop in open interest by -1.53% and a price increase of 180 rupees. Turmeric has support at 13,416, with potential testing of 13,124, and resistance is likely at 13,954, with the possibility of testing 14,200.

Trading Ideas:

* Turmeric trading range for the day is 13124-14200.
* Turmeric gained due to the potential for yield losses caused by the crop's anticipated unfavourable October weather.
* However, upside seen limited amid improved crop condition due to favorable weather condition.
* Expectations for a 20–25 percent decline in turmeric seeding this year
* In Nizamabad, a major spot market, the price ended at 13502.25 Rupees gained by 0.56 percent.
 

JEERA

Yesterday, jeera prices experienced a decline of -1.88% to settle at 46,490 Rupees per quintal. This drop can be attributed to favorable weather conditions for crop sowing, leading to increased sowing activities. Stockists are showing interest in purchasing due to the recent price decrease, which is triggering short covering. Additionally, the limited availability of quality crops is providing support to prices. Global demand for Indian jeera has declined as buyers are opting for alternatives like Syria and Turkey due to the higher prices in India. This is expected to impact Indian jeera exports in the coming months, as the competitiveness of Indian jeera in the global market is not in favor of exporters at the moment. Furthermore, the possibility of China purchasing Indian cumin in October-November adds uncertainty to market dynamics. According to FISS forecasts, cumin demand is projected to exceed supply this year, with a likely supply of 65 lakh bags against a demand of over 85 lakh bags. In terms of exports, jeera exports for Apr-Aug 2023 have dropped by 23.76% compared to the same period in 2022. In August 2023, 8,081.60 tonnes of jeera were exported, showing a 2.61% drop compared to July 2023 and a significant 66.98% drop compared to August 2022. On the technical front, the market is undergoing long liquidation, with a decrease in open interest by -0.88% to settle at 4,071. Jeera is finding support at 45,670 and may test 44,840 levels if it falls below this. Resistance is likely to be encountered at 47,610, with the possibility of prices testing 48,720 if they move above this level.

Trading Ideas:

* Jeera trading range for the day is 44840-48720.
* Jeera dropped as adequate soil moisture, and favorable weather condition for crop will boost the overall sowing activities.
* The upcoming sowing of jeera that is expected to remain normal due to favorable weather condition.
* Stockists are showing interest in buying on recent downfall in prices triggering short covering.
* In Unjha, a major spot market, the price ended at 47963.35 Rupees dropped by -0.54 percent.

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