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Metal’s Outlook

Bullion Outlook

* Spot Gold is likely to face stiff resistance near $3450 and move back towards $3375 on easing safe haven demand. Growing optimism over US and EU trade deal after deal with Japan would likely to weigh on the yellow metal prices. Further higher global bond yields would likely to undercut the prices of precious metals. Meanwhile, weakness in the dollar and increasing ETF buying would provide some support to the precious metals. Gold ETF holding rose to a two year high, whereas silver ETF holding hit three-year highs. Meanwhile, investors will eye on ECB interest rate decision and other key economic numbers for more clarity.

* On the data front, a strong call base at 3450 would act as key hurdle for prices. MCX Gold Aug is expected to face strong resistance near Rs.100,500 level and move back towards Rs.98,500 level.

*  MCX Silver Sep is expected to correct towards Rs.114,000 level as long as it trades under Rs.116,65 level.

Base Metal Outlook

* Copper prices are expected to trade with a positive bias on optimistic global market sentiments. Further, hopes of stimulus from China to stabilize growth in key sectors such as machinery, autos, and electrical equipment could boost demand for industrial metals. Meanwhile, the US specified that refined copper would also be taxed after tariffs. This would increase US demand for the metal in the near term. Additionally, investors will eye on today’s manufacturing data to get clarity on any improvement in US manufacturing activity.

* MCX Copper July is expected to rise towards Rs.905 level as long as it stays above Rs.891 level. A break above Rs.905 level prices may rally further towards Rs.910 level

* MCX Aluminum July is expected to face resistance near Rs.256 level and correct towards Rs.251 level. MCX Zinc July is likely to move north towards Rs.272 level as long as it stays above Rs.266 level.

Energy Outlook

*  Crude oil is likely to trade with positive bias on growing prospects of trade deal optimism with EU. The US and EU are working on a trade deal similar to the deal with Japan. The prospects of trade deal would increase risk-on sentiments and support oil prices. Additionally, fall in US crude oil inventories last week and concerns over low supplies would support prices to hold its ground above $64 mark. Meanwhile, investors will eye on nuclear talks in between Iran and EU nations on Friday, any positive outcome will restrict upside in prices.

*  On the data front, 65 put strike has highest OI concentration which would act as key support. On the upside $68 and $70 would likely to act as immediate hurdle. MCX Crude oil Aug is likely to hold the key support at Rs.5550 level and rebound towards Rs.5800 level.

*  Natural gas is likely to find the floor near Rs.260 and rebound towards Rs.275 ahead of futures contract expiry. Only a move below Rs.260 it would slide towards Rs.254 mark.

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