MCX Gold Apr seen holding Rs.159,500 support; may rise to Rs.163,500 - ICICI Direct
Metal’s Outlook
Bullion Outlook
• Spot gold is expected to find support near $5050 and rebound towards $5200 amid safe haven buying. Escalating geopolitical tension in the Middle east would increase risk premiums as the war entered 13th day. Geopolitical risks remain elevated as Iran’s new Supreme Leader threatens to open additional fronts in response to any potential U.S. or Israeli strikes. Meanwhile, a strong dollar and rising treasury yields would restrict upside in the precious metals. Diminishing rate cut bets ahead of the next weeks Fed meeting would keep a check on prices.
• MCX Gold April is expected to hold support near Rs.159,500 and move higher towards Rs.163,500.
• International Spot silver is likely to move in the band of $82 and $88. MCX Silver May is expected to move towards Rs.263,000 as long as it stays under Rs.274,000. Only a move below Rs.263,000, it would slip towards Rs.259,000.
Base Metal Outlook
• Copper prices are expected to remain under pressure amid strong dollar and rising inventory levels in major exchanges. Further, ongoing geopolitical uncertainties in the Middle east would also hurt demand outlook. Meanwhile, better than expected US housing data could support prices to limit its downside. Moreover, today investors will eye on weekly SHFE inventory data and other economic numbers from China to get more clues. In the near term MCX Copper March is projected to move in the broad range of Rs.1,190 and Rs.1,210 with a negative bias.
• MCX Aluminum March is expected to hold above Rs.344 and rise towards Rs.355 level. Prices are expected to remain higher due to supply disruption from the Middle east region.
• MCX Zinc March is likely to face hurdle near Rs.328 level and move lower towards Rs.321 level
Energy Outlook
• NYMEX crude oil is hovering near $95 per barrel after a sharp rally of 9% on Thursday. Oil prices are likely to remain volatile amid uncertainty over oil supplies from the Middle east as the conflict enters 13th day. The ongoing conflict has paralyzed Gulf shipping, halting 20% of global trade. Consequently, GCC members have been forced to implement a 10-million-barrel-per-day production cut as regional storage reached full capacity. Meanwhile, US has issued a 30-day license for countries to buy Russian oil and petroleum products currently stranded at sea which could ease supply concerns and limit its upside. NYMEX crude is likely to move towards $98, as long as it holds above $88.
• MCX Crude oil April is likely to move in a broader range of Rs.8300 and Rs.8900. A move above Rs.8900 it would rise towards Rs.9200
• MCX Natural gas March future is expected to rise towards Rs.310 as long as it trades above Rs.285
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