MCX Silver July is expected to slip towards Rs244,000-Rs241,500 level as long as it stays below Rs255,000 level - ICICI Direct
Metal’s Outlook
Bullion Outlook
• Spot Gold is likely to face the stiff resistance near $4380 level and dip towards $4280 level on strong dollar and rise in US treasury yields. Further, prices may slip as robust economic data from US signaled resilience in economy, giving room for US Fed to hold the interest rates at higher level for longer duration. Moreover, escalating hostilities in Middle East may keep oil prices at elevated level and oil related inflationary concerns alive. As Per CME Fed Watch tool markets are currently pricing about a 72% chance of a Fed rate hike in December. Meanwhile, sharp fall in the prices may be cushioned amid strong central bank buying. China's central bank accumulated gold for 19th straight month, with its reserves totaling 74.96 million fine troy ounces by the end of May, compared with 74.64 million a month earlier. MCX Gold Aug is expected to slip towards Rs153,000-Rs152,000 level as long as it stays below Rs157,500 level
• MCX Silver July is expected to slip towards Rs244,000-Rs241,500 level as long as it stays below Rs255,000 level.
Base Metal Outlook
• Copper prices are expected to trade with negative bias on weak global market sentiments, strong dollar and on concerns that Middle East conflict would hamper demand growth. Furthermore, copper may face headwinds from inflation concerns as it may prompt tighter monetary policy in major economies, alongside growth risk that may hurt demand for industrial metal. Meanwhile, sharp fall in the prices may be cushioned on renewed concerns about US import tariffs and declining inventories at LME registered warehouses.
• MCX Copper June is expected to slip towards Rs1320 level as long as it stays below Rs1360 level. A break below Rs1320 level prices may be pushed towards Rs1315-Rs1305 level
• MCX Aluminum June is expected to slip towards Rs380-Rs377 level as long as its stays below Rs389 level. MCX Zinc June is likely to face stiff resistance near Rs370 level and slip towards Rs360-Rs358 level.
Energy Outlook
• NYMEX Crude oil is likely to trade with positive bias on fears that rising hostilities in Middle East may jeopardies the peace talks between US and Iran. Further, Israel launched renewed strikes on Lebanon despite of truce, eroding hopes for an end to wider conflict and re-opening of Strait of Hormuz. Iran retaliated for strikes on Lebanon by launching missiles at Israel. Additionally, investors fear that exports from US may decline as US driving season may lift domestic demand, tightening global supply. While, OPEC+ said they will increase oil output by 188,000 barrels per day in July, marking fourth consecutive month. However, this higher volume will remain largely on paper until war ends and oil supplies through strait of Hormuz resumes
• MCX Crude oil June is likely to hold support near Rs8700 level and rise towards Rs9100-Rs9200 level
• MCX Natural gas June is expected to slip towards Rs300-Rs295 level as long as it stays below Rs320 level.
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