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Metal’s Outlook

Bullion Outlook

* Spot gold is expected to hold the support of 50 day EMA at $2645 and move in a tight range ahead of the Fed meeting. Gains will be restricted on growing skepticism over Fed rate cuts in January. Further, expectation of better than expected retail sales numbers would also check any major up move in the metal. Meanwhile, all focus will remain on Fed’s monetary policy outlook which would give further clarity in price direction.

* Spot gold is likely to hold the 50 day EMA support near $2645 and move towards $2675. Only a move below $2645 it would weaken further towards $2615. Formation of a bearish engulfing pattern could limit upward move. Meanwhile, the oscillator RSI is at 50, indicating sideways movement. MCX Gold February is expected to hold the support of 76,800 and move towards 77,500. Only close below 76,800 it would turn bearish.

* MCX Silver March is expected to remain in the range of 90,400 and 92,400. Below, 90,400 it would open the doors towards 89,000.

Base Metal Outlook

* Copper prices are expected to trade lower amid weaker economic numbers from China. Weakness in the credit growth numbers and slowdown in new home prices would weigh on the metals demand. Further, slowdown in retail sales and weakness in the Yuan could depress prices and dampen demand outlook. Meanwhile, focus will remain on the Fed’s policy which will give more clarity on its policy outlook.

* MCX Copper December is expected to face the hurdle of 50 day EMA at 820 and move lower towards 808. • Aluminum is expected to consolidate in the band of 242 and 245 ahead of key event tomorrow. Only close below 242 it would weaken towards 240.

* MCX Zinc is expected to dip towards 283, as long as it trades under the 20 day EMA at 287.

Energy Outlook

* NYMEX Crude oil is likely to find the floor near $69 and move towards $71 amid growing speculation over fresh sanctions on Iranian oil. Price would also find support on growing optimism over 25 bps interest rate cut from the Fed. Lower interest rates can boost economic growth and improve demand outlook. Meanwhile, sluggish demand growth from China and rising gasoline stocks would limit its upside.

* On the data front, fresh addition of OI near ATM call strikes indicates oil prices to remain in the range of $69 to $71. MCX Crude oil December is likely to hold the support of 50 day EMA at 5900 and rise towards 6100. Only below 5900 it would turn weaker.

* MCX Natural gas December future is expected to hold the support near 20 day EMA at 266 and rebound towards 280. Only close below 266 it would open the doors towards 260. Forecast of mild weather and rising output would limit its upside.

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