MCX Gold Aug Eyes Rs 145,000 Above Rs 141,800 Support - ICICI Direct
Metal’s Outlook
Bullion Outlook
• Spot gold is likely to trade higher and move towards $4180 as long as itholds above $4050 on safe haven buying. Escalating Middle East tensions,also concerns over widening conflict in the region would be supportive forthe metal. Moreover, strong central bank buying would be supportive forgold prices. Meanwhile, higher oil prices and raising inflation concerns couldlead to tighter monetary policy and check its upside. Additionally, ongoingETF outflows are expected to pressure prices. Long holdings in gold ETF sfell to 9-month lows.
• MCX Gold Aug is expected to rise towards Rs 145,000 level as long as it holdsabove Rs 141,800 level. Only a move below Rs 141,800, it would turn weakertowards Rs 140,000.
• Spot silver is hovering near $60 per ounce mark. A move above $60 wouldbring fresh momentum and push price towards $62 mark. On the downside$57.80 would act as strong support. MCX Silver September is expected tohold its ground above Rs 218,000 and rise towards Rs 234,000.
Base Metal Outlook
• Copper prices are expected to remain elevated and potentially trendhigher, supported by tight raw material supplies and robust physicaldemand in China. A sharp spike in imported copper premiums to a 14-month high of $100 per ton will further prop up prices. Additionally,depleting inventories on the LME and SHFE, with SHFE stocks hitting 10-month lows and triggering a backwardation structure would providestrong fundamental backing. However, weaker-than-expected economicindicators from China and the prospect of a tight monetary policy fromthe U.S. Federal Reserve are likely to cap further gains.
• MCX Copper July is expected to rise towards Rs 1350 as long as it tradesabove Rs 1330 level.
• MCX Aluminum July is expected to move higher towards Rs 345 - Rs 347, aslong as it stays above Rs 340. MCX Zinc July is likely to rise towards Rs 380as long as it trades above Rs 372 -Rs 373 level.
Energy Outlook
• NYMEX crude is likely to hold its gains above $82 and move higher towards$88-$90 amid growing risk of further supply disruption. U.S. operationsagainst Iranian targets and Houthi aggression against commercial shippingare actively obstructing energy flows, causing several tankers to divert theirroutes. The Red Sea is currently a pivotal corridor for Saudi Arabian crudeexports following the de-facto closure of the Strait of Hormuz. Any furtherdisruptions in this region will have severe consequences for global oilbalances, ensuring prices remain highly elevated. Meanwhile, focus willremain on US EIA inventory data.
• The oil market structure remains in steep backwardation, with near-monthprices commanding a $2.4 per barrel premium over later-dated contracts,pointing to severely tighter prompt supplies and geopolitical supply risks.MCX Crude oil August is likely to move towards Rs 8500 - Rs 8600 as long as itholds above Rs 8000.
• MCX Natural gas July is expected to hold above Rs 270 and rise towards Rs 280.
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