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Metal’s Outlook

Bullion Outlook

• Spot gold is likely to hold its gains and move towards $2600 mark amid growing prospects of outsized rate cut this week. Forecast of weaker retail sales numbers could weigh on the dollar and favor the 50 bps interest rate cut by the US Federal Reserve in this week’s meeting. Further, fund buying would push prices higher as the ETF holdings rose to a 7-month high. While, focus will remain on key economic numbers from US and the FOMC meeting on Wednesday which could bring further more clarity on price direction. Increasing OI at ATM and OTM put strikes indicates strong support for the yellow metal near $2550.

• MCX Gold Oct is expected to rise towards 74,000, as long as it holds above 73,050.

• Spot silver has to move beyond $31.20 to bring fresh buying interest in the metal. Above $31.20 it would open the doors towards $31.70. MCX Silver is expected to move higher towards 90,400, as long as it holds the key support at 87,400.

Base Metal Outlook

• Copper prices are expected to hold its earlier gains amid softness in the dollar. Further, improved risk sentiments amid growing prospects of 50 bps interest rate cut by the US Federal Reserve would also provide support to prices. Additionally, increasing hopes of fresh round of stimulus from China to achieve its growth target would push prices higher. On the other hand higher inventory levels in LME would restrict its upside. Low liquidity could be observed amid bank holiday in China.

• MCX Copper September is expected to hold the support near 802 and move towards 814. A move below 802 would weaken it towards 798.

• MCX Aluminum is expected to rise towards 235, as long as it holds above 229 mark.

Energy Outlook

• NYMEX Crude oil is expected to edge up amid supply disruption and growing expectation of a 50 bps interest rate cut by the US Fed. Supply disruption from Libya and impact of hurricane on US oil production would provide support to prices. Meanwhile, weaker economic numbers from China and drop in oil refinery output in China to its 5-month low amid weak export margins and disappointing fuel demand would restrict any major upside in prices. On the upside $72 would act as major resistance for price. Similarly $68 would act as strong support for prices. Meanwhile, addition of OI in the ATM and OTM put strike indicate strong support near $65.

• MCX Crude oil October is likely to rise towards 5900,as long as it holds above 5650. Reversal in the RSI indicates an immediate rebound in prices.

• MCX Natural gas September is likely to rise towards 206, as long as it holds above 190

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