MCX Silver May is expected to find support near Rs 93,200 and rebound towards Rs 96,450 level - ICICI Direct
Metal’s Outlook
Bullion Outlook
• Gold is expected to hold the support near $3060 per ounce and trade with higher bias amid safe haven buying. Further, weakness in the dollar and US treasury yields would help the metal to regain its strength. Safe haven buying would bring more inflows into the yellow metal as most investors turned cautious amid heightened trade war concerns. Moreover, investors will await any retaliatory measures from other nations which could bring more volatility in the bullion price. Meanwhile, focus will also remain on key US job numbers.
• On the data front unwinding of OI in ATM call strikes and addition of OI in ATM put strike 3100 indicates prices to hold strong support near $3100, followed by $3060. On the upside immediate resistance exists near $3150 level. MCX Gold June is expected to hold the support at Rs 89,000 and move higher towards Rs 90,700 level.
• MCX Silver May is expected to find support near Rs 93,200 and rebound towards Rs 96,450 level. Only move below Rs 93,200, it would turn weaker
Base Metal Outlook
• Copper prices are likely to remain under pressure amid risk-off sentiments. Recent reciprocal tariff measures from US would hurt global risk sentiments and hurt the demand outlook of base metals. Further, no such tariffs on copper imports would lower the risk premium, which could lead to lower prices in COMEX. Additionally, investors fear that tit for tat approach could increase the risk of broader global trade war, which may have adverse effect on economic growth denting demand for industrial metal. Meanwhile, weakness in the dollar and depleting inventory levels in LME would limit its downside.
• MCX Copper April is expected to move lower towards Rs 855 as long as it trades under Rs 875. Only break below Rs 855 level prices may dip further towards Rs 848.
• MCX Aluminum April is expected to slip further towards Rs 235 level as long as it stays below Rs 242 level. MCX Zinc April is likely to move south towards Rs 255 level as long as it stays below Rs 260 level. Below, Rs 255 it would open t the doors towards Rs 252.
Energy Outlook
• NYMEX Crude oil is expected to trade lower amid OPEC+’s supply increase and risk-off sentiments. The US tariffs and retaliation from target countries would increase the probability of trade war, which might hurt global oil demand outlook. US president Donald trump has warned that he is prepared to go higher if countries retaliate. This is likely to impact global growth and put demand under pressure.
• On the data front, addition of OI in OTM and ATM call strike indicates price face stiff resistance near $68 per barrel. Meanwhile, higher OI concentration at 65 put strike could provide support to price. MCX Crude oil April is likely to weaken towards Rs 5600 as long as it trades under Rs 5800 level.
• MCX Natural gas April is expected to trade lower towards Rs 345 level as long as it trades under Rs 362 level. Rise in inventory levels would likely to weigh on gas prices.
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