Gold is expected to hold the key support near $2910 and move higher towards $2942 amid increasing safe haven demand - ICICI Direct
Metal’s Outlook
Bullion Outlook
* Gold is expected to hold the key support near $2910 and move higher towards $2942 amid increasing safe haven demand. Uncertainty over the reciprocal tariffs on trading partner countries is likely to hurt sentiments and reinforce bullion’s appeal as safe haven asset. Meanwhile, a stronger dollar and higher US treasury yields could check its upside. Further, investors will focus on the US FOMC meeting minutes outcome, which could give more clarity on Fed policy.
* Gold price is hovering near its all time high at $2942. A move above could open the doors towards $2970. Higher concentration of OI in 2950 call strike could provide some resistance, but a move above $2950 could bring short covering rally. MCX Gold April is expected to hold the support Rs.85,500 and move towards Rs.86,600 level.
* Spot silver, is expected rise towards $33.00,as long as it trades above $32. MCX Silver March is expected to rise towards Rs.98,200, as long as it holds above Rs.95,600.
Base Metal Outlook
* Copper prices are expected to hold its ground and move higher on the prospects of demand improvement in China. Additionally, strong imports from China and pick up in industrial activity would also support prices. Meanwhile, widening of contango in between LME cash and 3M forwards indicated easing supply issues. Meanwhile, focus will remain on house price data from China and housing starts numbers from US. Further, investors will also eye on the progress of peace talk.
* MCX Copper February is expected to hold the support at Rs. 860 and rebound towards Rs.872.
* MCX Aluminum Feb is expected to find support near Rs.259 level and move higher towards Rs.264 level. Tightness in the physical market and depleting inventories would support the metal to stay higher. MCX Zinc Feb is hovering near key resistance at Rs.271, a move above would open the doors towards Rs.274 level. On the downside Rs.267 would act as key support.
Energy Outlook
* NYMEX Crude oil is expected to hold the key support near $70 and move higher towards $73 amid signs that OPEC could delay further production hikes. Further, supply concerns would support prices in the short term. Meanwhile, focus will remain on the peace negotiation between Russia and US. Moreover, investors will also monitor the FOMC meeting minutes and Fed’s stance on timing of interest rate cut.
* On the data front, addition of OI has been observed in OTM Calls. On upside $73 would act as key hurdle. Similarly, higher OI concentration at 70 put strike would act as major support. MCX Crude oil March is likely to consolidate in the band of Rs.6150 and Rs.6300 in the near term, Only close above Rs.6300 it would rise towards Rs.6360.
* MCX Natural gas Feb is expected to hold the support at Rs.328 and move higher towards Rs.350. Forecast of colder weather in US and rising export demand would help prices to trade firm.
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