MCX Gold April is expected to slip towards Rs 157,500 as long as it trades under Rs 162,000 - ICICI Direct
Metal’s Outlook
Bullion Outlook
* Spot gold is expected to trade lower amid diminishing hopes of early rate cut from US Federal Reserve. Higher energy prices and mounting inflationary pressures have lowered the probability that major central banks will cut interest rates. This week US central bank is expected to hold its rates steady, whereas focus will also remain on other central banks policy decisions. Meanwhile, downside in the precious metal may be limited due to escalating geopolitical tension in the Middle east which has entered the 3 rd week. On the data front, large speculators increased their net bullish exposure to gold.
* MCX Gold April is expected to slip towards Rs 157,500 as long as it trades under Rs 162,000.
* International Spot silver is likely to move in the band of $78 and $83. MCX Silver May is expected to move towards Rs 254,000 as long as it stays under Rs 270,000. Only a move below Rs 254,000 it would slip towards Rs 250,000.
Base Metal Outlook
* Copper prices are expected to remain under pressure amid softening Chinese demand and rising global inventory levels in major exchanges. Further, ongoing geopolitical and trade uncertainties would also hurt demand outlook. The contraction in China's new home prices accelerated to 3.2% annually in February, highlighting a persistent downward trend that has now stretched to nearly three years. Moreover, fall in the Yangshan copper premium likely to weigh on prices.
* In the near term MCX Copper March is projected to move towards Rs1,170 as long as it trades under Rs1,200
* MCX Aluminum March is expected to hold above Rs340 and rise towards Rs352 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 Rs328 level and move lower towards Rs321 level.
Energy Outlook
* NYMEX crude oil is likely to remain volatile amid ongoing conflict in the Middle east, which has entered 3 rd week. Oil supplies through the Strait of Hormuz has been paralyzed, halting 20% of global trade. Meanwhile, US President warned to target Kharg Island ( which handles roughly 90% of the country’s oil export) if Tehran interferes with transit through the Strait of Hormuz. Moreover, the IEA said that oil from last week’s record 400-million-barrel reserve release will be made available immediately in Asia which would ease supply concerns. NYMEX crude is likely to move in a broader range of $94 and $104.
* MCX Crude oil April is likely to move in a broader range of Rs8500 and Rs9100. A move above Rs9100 it would rise towards Rs9400
* MCX Natural gas March future is expected to find support near Rs280 and rebound towards Rs300
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