MCX Gold October is expected to rise towards Rs158,000 as long as it holds above Rs153,000 level - ICICI Direct
Metal’s Outlook
Bullion Outlook
• Spot Gold is expected to hold above $4,400 and extend its rebound toward $4,680 level, driven by a pullback in U.S. dollar and global treasury yields. Furthermore, easing concerns of monetary tightening after dovish comments from Fed members and a pause in crude oil price rally should ease rate hike bets and support bullion prices. As per the CME Fedwatch toll, the probability of a September rate hike dropped to 50% from 63%, further supporting gold. Meanwhile, focus shifts to today’s U.S. Non-Farm Payroll data; any sign of moderation in the labor market could spark a further recovery rally in gold prices.
• MCX Gold October is expected to rise towards Rs158,000 as long as it holds above Rs153,000 level.
• MCX Silver December is expected to move higher towards Rs246,000 as long as it trades above Rs240,000. Only a move above Rs246,000, it would rise towards Rs248,000 level.
Base Metal Outlook
• Copper prices are expected to hold their ground and trade higher, driven by a softer dollar and easing rate hike bets. Additionally, persistent supply concerns and depleting inventory levels in the LME should provide support to the metal. Short-term availability of copper in the LME remains tight, with the spot price trading at a premium of $100 per ton above three-month futures. Meanwhile, geopolitical risks and escalating tensions between the US and Iran could hurt global demand prospects and limit the upside.
• MCX Copper September is expected to hold above Rs1370 and rise towards Rs1395 level. Only a move above Rs1395 level, it will turn bullish towards Rs1405.
• MCX Aluminum September is expected to hold support near Rs345 level and rise towards Rs352-?355. Middle East tensions would hurt supplies and provide support to prices. MCX Zinc September is likely to hold support near Rs410 level and move higher towards Rs420 level.
Energy Outlook
• NYMEX crude futures are expected to remain volatile amid growing uncertainty surrounding shipping through the Strait of Hormuz. Any sign of further escalation would hurt global oil supplies and support prices. Meanwhile, latest data indicates only 5 to 6 vessels transited the strait on Wednesday down from 10-day average of nearly 13. Further, damage to oil refineries in the Gulf region as well as in Russia and depleting inventory levels would keep prices elevated. The prospects of an extended conflict in the region will keep the oil flows constrained and force the suppliers to seek alternate routes to supply.
• NYMEX crude oil is expected to rise towards $93 per barrel as long as it holds above $88 mark. MCX Crude oil September is expected to rise towards Rs9000 as long as it holds above Rs
8400 level.
• MCX Natural gas September is expected to hold support near Rs272 level and rise towards Rs285 level.
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