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Gold

Gold prices rose by 0.5% to settle at Rs.80,026 per 10 grams, supported by heightened uncertainty around U.S. President Donald Trump's tariff policies and his calls for immediate interest rate cuts by the Federal Reserve. Concerns over Trump’s proposed tariffs and immigration policies prompted traders to move toward safe-haven assets. Additionally, market participants remain attentive to central bank actions, with the BoJ recently raising rates, while the Fed and ECB are expected to maintain and cut rates, respectively. Global demand dynamics also influenced gold prices. COMEX-approved warehouse stocks surged by a third over six weeks, reflecting traders’ hedging against potential U.S. import tariffs. Net long positions in COMEX gold increased significantly, rising by 17,994 contracts to 212,494 in the week ending January 14. However, higher gold prices suppressed physical demand in Asian markets. Indian dealers offered steep discounts of up to $38 per ounce over official domestic prices, the largest in six months, as jewellers hesitated on speculation about possible import duty changes in the upcoming budget. In contrast, premiums remained steady in China, ranging between $3 and $13 per ounce. Central banks continued driving gold demand. Poland added 21 tonnes to its reserves in November, and India added 8 tonnes, pushing its 2024 total purchases to 73 tonnes. Gold witnessed short covering as open interest dropped by 15.13% to 6,672. Support is at Rs.79,720, with further downside likely testing Rs.79,405. Resistance stands at Rs.80,330, and a move above may push prices to Rs.80,625.
 

Trading Ideas:
* Gold trading range for the day is 79405-80625.
* Gold rose after President Trump called for an immediate reduction in interest rates.
* Support also seen buoyed by uncertainty surrounding U.S. President Donald Trump's tariffs plans.
* Elevated prices dampened demand for physical gold in most Asian hubs.

 

Silver
Silver prices gained 0.49% to settle at Rs.91,599 per kg, supported by U.S. President Donald Trump's call for lower interest rates and uncertainty around his trade policies. While the Federal Reserve is expected to maintain rates during its upcoming meeting, markets are speculating on potential rate cuts later in the year, with a reduction anticipated as early as July. A weaker dollar and safe-haven demand due to global economic uncertainties further bolstered silver's appeal. Industrial demand remains a key driver for silver prices. The metal, widely used in jewelry, electronics, electric vehicles, and solar panels, continues to see strong demand, particularly amid ongoing supply concerns in London vaults. The global silver deficit is projected to narrow by 4% to 182 million ounces in 2024, with total supply growing by 2%, offsetting a 1% rise in demand, according to the Silver Institute. Industrial consumption is expected to reach a record 1.21 billion ounces, driven by higher solar panel and EV requirements, while physical investment is forecast to drop by 16%. Mine supply is set to increase by 1%, primarily from Mexico, Chile, and the U.S., while recycling may grow by 5% due to increased western silverware scrap. The silver market saw short covering, with open interest declining by 4.03% to 21,459 as prices climbed Rs.450. Support is at Rs.91,120, with further downside testing Rs.90,640. Resistance is at Rs.92,360, and a move above this level could push prices toward Rs.93,120.
 

Trading Ideas:
* Silver trading range for the day is 90640-93120.
* Silver rallied steered by U.S. President Trump's calls to lower interest rates.
* While the US central bank is widely expected to keep rates unchanged at policy meeting.
* Trump has refrained from imposing aggressive tariffs since his inauguration, which has weakened the dollar.


Crude Oil
Crude oil prices dropped by 0.88% to settle at Rs.6,427, weighed down by U.S. President Donald Trump's call for lower oil prices during the Davos forum. Trump’s plan to pressure Saudi Arabia and OPEC to reduce prices, combined with increased U.S. production, heightened bearish sentiment in the market. Meanwhile, his threats of tariffs on China, Canada, and Mexico raised fears of slowed global economic growth, which could dampen oil demand. U.S. crude oil inventories rose by 1 million barrels last week, according to the American Petroleum Institute, while gasoline and distillate stockpiles surged by 3.23 million and 1.88 million barrels, respectively. The Energy Information Administration (EIA) reported a smaller-than-expected drop in crude inventories, down 1.02 million barrels versus the anticipated 2.1 million barrels. Additionally, U.S. oil production is forecast to reach a record 13.55 million barrels per day in 2025, with the Permian Basin accounting for over half of the output. Global production is expected to average 104.4 million barrels per day in 2025, outpacing demand at 104.1 million barrels per day, further pressuring prices. The market is under long liquidation, as open interest fell by 3.3% to 8,041, with prices declining by Rs.57. Crude oil has immediate support at Rs.6,383, and a break below this could test Rs.6,339. On the upside, resistance is seen at Rs.6,485, and a move above this level could push prices toward Rs.6,543.
 

Trading Ideas:
* Crudeoil trading range for the day is 6339-6543.
* Crude oil dropped mainly due to President Trump’s call for lower crude prices.
* Trump announced plans to urge Saudi Arabia and OPEC to reduce oil prices, and made moves to boost US production.
* Stocks of crude oil in the US fell for a fell for a ninth consecutive week.

 

Natural Gas
Natural gas prices gained 0.89% to settle at Rs.340.5, supported by forecasts of colder-than-normal weather across the U.S. and increased gas flows to liquefied natural gas (LNG) export facilities. The return to service of Freeport LNG's Texas plant after an outage further boosted sentiment. The recent plunge in temperatures to a five-year low heightened demand, driving daily gas consumption to record highs, alongside multi-year peaks in spot gas and power prices. Production in the Lower 48 U.S. states fell to an average of 102.0 billion cubic feet per day (bcfd) in January, down from a record 104.5 bcfd in December 2023, due to freeze-offs impacting wells and pipelines. Daily output, however, rebounded to 99.3 bcfd on Wednesday after falling to a one-year low of 97.5 bcfd earlier in the week. In storage data, U.S. utilities withdrew 233 billion cubic feet (bcf) of natural gas last week, slightly less than the anticipated 244 bcf, bringing inventories to 2,896 bcf. While stocks are 1.9% lower year-on-year, they remain 0.7% above the five-year average. The EIA’s Short-Term Energy Outlook (STEO) predicts record highs for natural gas output and demand by 2025, with dry gas production projected to hit 104.5 bcfd and LNG exports rising to 14.1 bcfd. The market witnessed fresh buying, with a 2.08% rise in open interest to 7,805. Natural gas has immediate support at Rs.331.2, with further downside at Rs.322. Resistance is seen at Rs.346, and a breakout above could lead to testing Rs.351.6.
 

Trading Ideas:
* Naturalgas trading range for the day is 322-351.6.
* Natural gas climbed on forecasts calling for colder weather over the next two weeks.
* US utilities withdrew 233 billion cubic feet of natural gas from storage to 2,896 bcf.
* Inventories are 1.9% below the corresponding period of the previous year, but remain 0.7% above the ongoing five-year average.



Copper
Copper prices climbed 1.02% to settle at Rs.841.25, supported by supply concerns and a favorable demand outlook. Freeport-McMoRan’s lower-than-expected Q4 production and its warning of a significant drop in Q1 output, due to maintenance and smelter damage in Indonesia, added bullish momentum. The company is also navigating ongoing negotiations with the Indonesian government to extend its export agreement. On the supply side, Chile revised its long-term copper production forecast to 5.54 million tons by 2034, down from 6.34 million tons, highlighting challenges in global output. Meanwhile, the global refined copper market reported a 131,000 metric tons deficit in November, widening from a 30,000 metric tons deficit in October, as per the International Copper Study Group (ICSG). This reflects higher consumption at 2.47 million metric tons against output of 2.34 million metric tons. Demand prospects remain strong, with China's imports of unwrought copper and copper products surging 17.8% year-on-year to 559,000 metric tons in December, the highest in 13 months. Refiners are actively restocking amid higher orders, further underpinning prices. Market sentiment also improved on expectations of stimulus from China’s central bank and easing U.S. policy concerns. Copper witnessed short covering, with open interest dropping by 25.36% to 2,408 while prices rose by Rs.8.5. Support is at Rs.834.2, with the next level at Rs.827.1. Resistance is at Rs.849.2, and a breakout could lead to testing Rs.857.1.
 

Trading Ideas:
* Copper trading range for the day is 827.1-857.1.
* Copper surged after major copper producer Freeport-McMoRan missed its fourth-quarter production targets.
* Prices were supported by US President Trump’s decision to refrain from imposing new tariffs..
* Copper inventories in warehouses monitored by the Shanghai Futures Exchange rose 10.4% from last Friday.


Zinc
Zinc prices fell by 0.65% to settle at Rs.269 as investors awaited clarity on U.S. President Donald Trump's tariff and policy plans. However, the downside was limited by declining inventories in LME-registered warehouses, with total stocks hitting their lowest levels since February 2024. On the demand side, China's industrial output saw a sharp acceleration in December, supported by the People’s Bank of China’s monetary stimulus. Data from the International Lead and Zinc Study Group (ILZSG) indicated a narrowing global zinc market deficit, which fell to 52,900 metric tons in November from 65,400 tons in October. For the first 11 months of 2024, the market recorded a 33,000-ton deficit, a stark contrast to the 312,000-ton surplus during the same period in 2023. China's refined zinc production increased by over 10,000 metric tons in December, with additional production from smelters in regions such as Qinghai, Shaanxi, and Inner Mongolia. January 2025 is expected to see a further increase of over 15,000 metric tons, or nearly 3% month-on-month, despite temporary production cuts in Hunan, Guangxi, and Sichuan for maintenance and Chinese New Year breaks. Zinc witnessed long liquidation, with open interest dropping by 26.18% to settle at 1,049 as prices fell Rs.1.75. Support is at Rs.266.9, with further support at Rs.264.7. Resistance is likely at Rs.272.6, and a breakout above this level could push prices toward Rs.276.1.
 

Trading Ideas:
* Zinc trading range for the day is 264.7-276.1.
* Zinc dropped as investors looked for clarity on U.S. President Donald Trump's tariff and policy plans.
* The global zinc market deficit in November fell to 52,900 metric tons from 65,400 tons in October.
* Industrial output in China accelerated sharply in December and credit aggregates gained traction


Aluminium
Aluminium prices saw a marginal increase of 0.08%, closing at Rs.252.75, as investors showed optimism regarding China after U.S. President Donald Trump's remarks about a potential trade deal with the world’s largest metals consumer. This sentiment was also supported by developments in the EU, which is preparing to sanction imports of primary aluminium from Russia in its upcoming sanctions package. This move is set to reinforce the ongoing phase-out of Russian aluminium imports, as European manufacturers have largely distanced themselves from buying Russian goods since the invasion of Ukraine in 2022.In terms of production, global primary aluminium output in December rose by 3% year-on-year to 6.236 million metric tons, according to data from the International Aluminium Institute (IAI). China’s aluminium production increased by 4.2% year-on-year to 3.77 million metric tons in December. However, aluminium producers in China faced challenges with rising costs, turning the industry’s average profit into a loss for the first time in three years. For 2024, China’s total production amounted to 44.01 million metric tons, a 4.6% increase compared to the previous year. Aluminium witnessed short covering, with open interest decreasing by 9.05% to settle at 1,226 as prices gained Rs.0.2. Support is at Rs.251.8, with potential for a test of Rs.250.8. Resistance is seen at Rs.254.4, and a break above this level could see prices moving toward Rs.256.
 

Trading Ideas:
* Aluminium trading range for the day is 250.8-256.
* Aluminium settled firm amid U.S -China optimism and Russian sanction moves
* Global primary aluminium output in December rose 3% year on year to 6.236 million tonnes
* Aluminium stocks at three major Japanese ports rose to 323,600 metric tons by the end of December.

 

Cotton Candy
Cotton candy prices settled lower by 0.08% at Rs.53,290, as the Cotton Association of India (CAI) revised its crop projections upwards for the 2024-25 season. The updated estimate now stands at 304.25 lakh bales, 2 lakh bales higher than earlier forecasts, largely driven by better-than-expected yields in Telangana, which saw an increase of 6 lakh bales. However, despite the upward revision in production, cotton prices remain under pressure, as the United States Department of Agriculture (USDA) raised global production and ending stocks projections for the 2024/25 crop year, adding downward pressure. A concerning trend has been observed in North India, with kapas arrivals down by 43% until November 30, compared to the same period last year. This has sparked supply chain concerns, with farmers holding onto their produce in anticipation of higher prices. Ginners and spinners in Punjab are also facing shortages of raw materials, further disrupting the supply chain. However, the downside to prices appears limited, with increased cotton yarn prices in South India due to rising demand from the garment sector and strong export orders. In terms of supply, total cotton supplies until December end were pegged at 176.04 lakh bales, and consumption estimates have been increased by 2 lakh bales to 315 lakh bales for the 2024-25 season. Cotton candy prices are witnessing long liquidation, with a significant drop in open interest by 14.85%, settling at 172. Support is at Rs.52,920, with potential to test Rs.52,540 if the trend continues. Resistance is observed at Rs.54,040, and a breakout above this level could lead to a test of Rs.54,780.
 

Trading Ideas:
* Cottoncandy trading range for the day is 52540-54780.
* Cotton dropped as CAI has revised upwards its crop projections by 2 lakh bales
* WASDE report projected higher production and ending stocks for the 2024/25 crop year, adding to the downward momentum.
* Global cotton production is projected to rise by more than 1.2 million bales to 117.4 million bales.
* In Rajkot, a major spot market, the price ended at 25662.15 Rupees dropped by -0.13 percent.

 

Turmeric
Turmeric prices settled down by 1.06% at Rs.13,790, as harvesting has started in key producing states like Karnataka and Andhra Pradesh, with Telangana expected to follow soon. However, the downside remains limited due to ongoing concerns over the slow growth of rhizomes and lower yield estimates. Farmers have reported that yields may be lower than expected, which could impact the market once the new crop arrives post-Makar Sankranti. While the supply of turmeric in the Erode-Warangal line has reduced significantly, the progress of harvesting and the weather conditions - particularly the influence of El-Nino—remain key factors to monitor. Despite these harvest challenges, domestic consumption is expected to be high, and the international market prices of turmeric remain elevated. Turmeric exports from April to November 2024 increased by 9.8%, reaching 121,601.21 tonnes, compared to 110,745.34 tonnes during the same period in 2023. However, exports in November 2024 showed a decline of 20.18% compared to October, although it was still a significant 48.22% increase from November 2023. Turmeric prices are undergoing long liquidation, with a slight reduction in open interest by 0.99% to 11,460 contracts. Support is seen at Rs.13,674, and if prices dip below this level, they could test Rs.13,556. Resistance is likely at Rs.13,936, with a break above this level pushing prices towards Rs.14,080.
 

Trading Ideas:
* Turmeric trading range for the day is 13556-14080.
* 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 13756.2 Rupees dropped by -1.53 percent.


Jeera
Jeera prices settled down by 0.98% at Rs.22,225 due to low demand, with the current export business being met from available stock. Despite the downturn, the downside remains limited due to the shortage of stocks, as farmers are holding onto approximately 20 lakh bags of cumin, with only 3-4 lakh bags expected to be traded by the end of the season. This suggests a carry-forward stock of around 16 lakh bags. The current season is expected to see similar production levels to last year, supported by favorable crop conditions and good sowing. India’s cumin seed production rose to 8.6 lakh tonnes in 2023-24, an increase from the previous year’s 5.77 lakh tonnes, as per Spices Board data. This increase in production, coupled with India’s status as the world’s cheapest supplier of cumin, is expected to attract demand from global markets, particularly China, where cumin prices are significantly higher. The price of Indian cumin stands at $3,050 per tonne, which is $200 to $250 lower than the price of Chinese cumin. Tensions in the Middle East have also boosted exports from Gujarat, with strong domestic and international demand, especially from Europe and other regions, ahead of the festive season. The market is under fresh selling pressure, as open interest has increased by 2.2% to settle at 2,364 contracts while prices dropped by Rs.220. Support is seen at Rs.22,120, and a break below this level could see prices testing Rs.22,020. Resistance is likely at Rs.22,360, and a move above this level may push prices towards Rs.22,500.
 

Trading Ideas:
* Jeera trading range for the day is 22020-22500.
* 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 23127.05 Rupees dropped by -0.32 percent.

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