MCX Aluminum July is expected to move in the band of Rs 328 and Rs 335 - ICICI Direct
Metal’s Outlook
Bullion Outlook
• Spot gold is likely to hold its ground above $4100 and move higher towards $4,200 amid softer dollar and reduced prospects of Fed tightening monetary policy. Last month’s weaker than expected US jobs data and lower crude oil prices would ease pressure on the US Federal Reserve to hike interest rates in this year. As per the CME Fed-watch tool September rate hike bets just cooled down below 55% from 60% a week ago. Further, prices would also get support on strong central bank buying. Meanwhile, sluggish jewellery demand growth and slowdown in ETF inflows would limit its upside. In the coming session, investors will eye on key US economic numbers and FOMC meeting minutes due tomorrow.
• MCX Gold Aug is expected to find support near Rs144,000-Rs145,000 level and rebound towards Rs148,500 level
• MCX Silver September is expected to rise towards Rs 240,000-Rs 241,000 level as long as it stays above Rs230,000 level.
Base Metal Outlook
• Copper prices are expected to trade higher amid softer dollar and tightness in the physical market. The global copper concentrate market remain tight, as spot treatment and refining charges fell further into a negative territory, suggesting strong demand of the raw material from smelters. Prices would also get support on easing concerns of monetary tightening from major central banks. Moreover, depleting LME inventory levels would provide support to prices. Meanwhile, focus will remain on key US decision on import duty on refined copper imports.
• MCX Copper July is expected to move higher towards Rs1300, as long as it stays above Rs1275 level. Only a move above Rs1300 it would rise towards Rs 1310.
• MCX Aluminum July is expected to move in the band of Rs 328 and Rs 335. Only a move above Rs 335 level it would open the doors towards Rs 338. MCX Zinc July is likely to hold support at Rs 365 level and rise towards Rs 374-Rs 376 level.
Energy Outlook
• NYMEX Crude is expected to trade with negative bias amid rise in global supply, increase in OPEC+ production targets and normalization of shipping activity through the Strait of Hormuz. Further, Saudi Arabian oil giant Saudi Aramco cut the price of its Arab Light crude for Asian buyers next month by $11 a barrel to a $1.50 discount against the regional benchmark, reflecting softer market conditions. Brent crude oil futures curve is trading in contango price structure, which indicates short-term oversupply. Meanwhile, focus will shift back towards Iran-US peace talks. Any setback in negotiation could bring further volatility in price. .
• NYMEX crude oil is likely to face hurdle near $70 and move lower towards $65. MCX Crude oil July is likely to slip towards Rs 6300, as long as it trades under Rs 6800 level.
• MCX Natural gas July is expected to slid towards Rs 300-Rs 295 level as long as it stays below Rs 320 level. Higher inventory levels would likely to counter strong summer demand.
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