MCX Copper February is expected to hold the support near Rs 850 and rebound towards Rs 872 - ICICI Direct
Metal’s Outlook
Bullion Outlook
• Gold is expected to move in a tight range of $2870 and $2910 in today’s session amid bank holiday in US. In a broader picture, gains in the yellow metal could be capped amidst easing tariff concerns. It is alsoy expected that the Trump administration is widely using tariffs as a negating tool. Further, the reciprocal tariffs could take weeks or even months to complete. Meanwhile, a drop of OI in the CFTC report also indicates long liquidation.
• On the daily charts, spot gold has formed a bearish engulfing pattern, which could restrict its upside. Further, addition of OI in OTM call strikes near 2925 suggest prices to face resistance near $2925. MCX Gold April is expected to face the hurdle near Rs 85,400 and move lower towards Rs 84,000 level.
• Sop silver, is expected consolidate in the band of $31.90 and $32.40. A move below $31.90 it would turn weaker. MCX Silver March is expected trade in the band of Rs 94,500 and Rs 96,600. Below Rs 94,500, it would turn weaker
Base Metal Outlook
• Copper prices are expected to remain volatile amid tariff concerns. A tight physical market and weakness in the dollar would support the red metal, where as no sign of tariffs on Copper imports could limit its upside. Meanwhile, depleting inventory levels in LME and a sharp jump in CFTC net longs indicates prices to stay higher. Additionally, strong imports from China and pick up in industrial activity would also strengthen bullish bets.
• MCX Copper February is expected to hold the support near Rs 850 and rebound towards Rs 872. A move below Rs 850, it would turn weaker.
• MCX Aluminum Feb is expected to find support near 10 day EMA Rs 256 level and move higher towards Rs 260 level. MCX Zinc Feb is hovering near key support at Rs 265, a move below would weaken it towards Rs 262 level. On the upside Rs 270 would remain as strong resistance.
Energy Outlook
• NYMEX Crude oil is expected to trade lower amid easing supply concerns. Subdued physical demand and improved supply scenarios would weigh on prices. The spread between near and far month has almost reduced to zero from $1.5 per barrel a month ago. This shift from backwardation to contango reflected less demand. Meanwhile, focus will remain on talks been Russia and Ukraine this week in Saudi Arabia, which could bring further clarity in price trend.
• On the data front, continuous drop in OI since last 5 weeks indicates liquidation in oil futures. More over, unwinding of OI in ATM and OTM put strike indicates weakness in price. On upside $73 would act as key hurdle. MCX Crude oil March is likely to remain under pressure and move lower towards Rs 6000 as long as it trades under ?6300.
• MCX Natural gas Feb is expected to hold the 10 day EMA support at Rs 306, if held then it would rebound towards Rs 330. Forecast of colder weather in US and rising export demand would help prices to trade firm
https://secure.icicidirect.com/Content/StaticData/Disclaimer.html
SEBI Registration number INZ000183631
