MCX Gold April is expected to face the hurdle near Rs 85,000 level and trade lower towards Rs 83,800 level - ICICI Direct
Bullion Outlook
• Gold is expected to take a pause in its rally and correct towards $2820 on expectation of an improved US Non-farm payroll numbers. A strong labor market and improved growth numbers from US would support the dollar to move higher and limit any major upside in the bullions. Further, hawkish comments for central bank member would also weigh on metal prices, as one of the Fed members indicated fewer rate cuts this year amid fiscal policy uncertainty. Meanwhile, safe haven buying due to trade war uncertainties is likely to provide support the yellow metal.
• MCX Gold April is expected to face the hurdle near Rs 85,000 level and trade lower towards Rs 83,800 level. Further, a move below Rs 83,800 level prices may slip towards Rs 83,000 level.
• MCX Silver March is expected to face the hurdle near multiple resistance zone at Rs 96,600 and move lower towards Rs 94,000. Only above Rs 96,600 level it would turn bullish and open the doors towards Rs 98,000.
Base Metal Outlook
• Copper prices are likely to take a pause after rallying to its highest level in 4-month. A stronger dollar and trade war uncertainties may limit the upside in the base metals. Meanwhile, tightness in supply from Chile would limit its downside. Furthermore, depleting inventory levels in LME and increasing prospects of fresh round of stimulus from China would help the metal to trade higher.
• MCX Copper February has been hovering near the multiple resistance zone at Rs 860, which could act as key hurdle and weaken its towards Rs 846. Only a sustained move above Rs 860 it would bring fresh buying interest in the metal and push prices towards Rs 867 level.
• MCX Aluminum Feb is expected to dip towards Rs 253 level as long as it trades under Rs 258 level. MCX Zinc Feb is likely to face the resistance of 20 day EMA Rs 272 level and move lower towards Rs 265 level. Only above, Rs 272, it would open the doors towards Rs 275.
Energy Outlook
• NYMEX Crude oil is expected to remain under pressure amid strong dollar and Trump’s pledge to boost oil output. Further, easing geopolitical risk and sluggish demand growth from China would weigh on prices. Further, concerns over new trade war between US and China would increase demand uncertainty. Meanwhile, a declining crude exports from Russia and new sanction on Iran by the Trump administration may limit downside in oil prices.
• On the data front, fresh addition of OI in ATM and OTM call strikes indicates prices to face stiff resistance. MCX Crude oil Feb is likely to face the hurdle near 20 day EMA at Rs 6350 and move lower towards Rs 6050.
• MCX Natural gas Feb is expected to hold its ground and move towards Rs 302 as long as it holds above Rs 284. Depleting gas inventory and forecast of colder weather in US would help prices to trade firm.
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