MCX Crude may dip to Rs.8700 - 8500 below Rs.9500 level - ICICI Direct
Bullion Outlook
* Spot Gold is likely to rise back towards $4850 amid weak dollar and softening of US treasury yields. Further, investors will keep an eye on peace talks between US and Iran. Any positive outcome of the meeting will increase hope for long term peace agreement. Moreover, oil price rally has narrowed after Isreal sought peace talks with Lebanon, renewing hopes for the fragile truce. Countries moving towards reconciliation and notably not moving towards wrong direction is talking off worst case scenarios of the table. Additionally, if the effects of oil shock were short lived than it may still provide some room for US Fed to cut rates. Meanwhile, investors will remain cautious ahead of inflation data from US to get some clarity on interest rate trajectory.
* MCX Gold June is expected to hold the support near Rs.150,000 level and rise towards Rs.155,000- Rs.157,000 level.
* MCX Silver May is expected to rise towards Rs.247,000- Rs.250,000 level as long as it stays above Rs.235,000 level.
Base Metal Outlook
* Copper prices are expected to trade with positive bias amid weak dollar and rise in risk appetite in the global markets. Market sentiments improved on optimism that ceasefire between US and Iran may hold and oil shipping would resume. Additionally, Israel sought peace talks with Lebanon. Moreover, prospect of stronger demand in China would be supportive for the prices. Yangshan copper premium, a gauge of China's appetite for imported materials, rose to $70 a ton, signaling demand. Meanwhile, rising inventory at LME registered warehouses would weigh on prices.
* MCX Copper April is expected to rise further towards Rs.1205 level as long as it stays above Rs.1173 level. A break above Rs.1205 level prices may be pushed towards Rs.1210- Rs.1215 level
* MCX Aluminum April is expected to slip towards Rs.349 level as long as its stays below Rs.359 level. MCX Zinc April is likely to hold support near Rs.327 level and rise towards Rs.333 level.
Energy Outlook
* NYMEX Crude oil is likely to trade with negative bias on growing optimism that truce between US and Iran will hold and oil shipping will resume. Additionally, Israel sought peace talks with Lebanon, including discussion on disarming Hezbollah. Investors will keep a close eye on peace talk between US and Iran and any sign of increased activity, tanker movement through Strait of Hormuz. Any positive outcome of the meeting will increase hope for long term peace agreement. Meanwhile, concerns over supply disruption resurfaced in Saudi Arabia after media reports that attacks had reduced the kingdom’s oil production capacity by about 600,000 bpd and cut throughput on its East-West Pipeline by roughly 700,000 bpd
* MCX Crude oil April is likely to dip towards Rs.8700- Rs.8500 level as long as it stays below Rs.9500 level.
* MCX Natural gas April is expected to slip towards Rs.240- Rs.235 level as long as it stays below Rs.261 level.
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