MCX Crude oil May is likely to slip back towards Rs8700-Rs8500 level as long as it stays below Rs9400 level - ICICI Direct
Metal’s Outlook
• Spot Gold is likely to rise further towards $4780 level on weak dollar and softening of US treasury yields. Further, prices may slip as signs of deescalation in Middle East and hopes for US-Iran agreement pushed oil prices lower, easing inflation concerns and reducing expectations that central bank would need to hold rates at elevated level. Further, as per media reports US has sent Iran new proposal that would lead to gradual reopening of Strait of Hormuz. Meanwhile, investors will remain cautious ahead of job data from US as to see whether economy remains resilient enough for Federal Reserve to hold rates steady or whether softening of labor market condition could revive the case for monetary easing
• MCX Gold June is expected to hold the support near Rs151,000 level and rise towards Rs153,000-Rs154,000 level.
• MCX Silver July is expected to rise towards Rs 256,000-Rs258,000 level as long as it stays above Rs249,000 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 report that the US and Iran are closing in on an agreement to end their war. Additionally, prospect of stronger demand in China would be supportive for the prices. Yangshan copper premium, a gauge of China's appetite for imported materials, increased to $69 a ton, signaling demand. Meanwhile, investors will remain cautious ahead of slew of economic data from major economies to gauge economic health and demand outlook.
• MCX Copper May is expected to rise towards Rs1315 level as long as it stays above Rs1290 level. A break above Rs1315 level prices may be pushed towards Rs1320 level
• MCX Aluminum May is expected to slip towards Rs366-Rs362 level as long as its stays below Rs375 level. MCX Zinc May is likely to hold support near Rs342 level and rise towards Rs348-Rs350 level
Energy Outlook
• NYMEX Crude oil is likely to trade with negative bias on signs of deescalation in Middle East and growing optimism about possible end to war in Gulf following reports that US has sent Iran 1-page memorandum of understanding. Further, Iran said it is reviewing a new U.S. proposal. This led to the expectations that supply from Middle East producing region could resume, easing supply concerns. Meanwhile, sharp fall in the prices would be cushioned as closure of Strait of Hormuz has drawn down global inventories. As per EIA weekly report crude oil stocks fell by 2.3 million barrels to 457.2 million barrels last week. Additionally, unfavorable comments from US President Donald Trump and senior Iranian lawmaker would cushion sharp fall in prices.
• MCX Crude oil May is likely to slip back towards Rs8700-Rs8500 level as long as it stays below Rs9400 level.
• MCX Natural gas May is expected to slip towards Rs245-Rs240 level as long as it stays below Rs 268 level
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