MCX Silver September is expected to hold the 50 day EMA support near 88,500 and rise towards 90,500 - ICICI Direct
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Bullion Outlook
Metal’s Outlook
* Spot gold is expected to find the floor near $2290 and rise towards $2345 amid softness in the dollar. Moderation in US core PCE numbers would increase the probability of early rate cut by the Fed. The US core PCE is expected to drop to 2.6% from 2.8% a month earlier. Further, rising jobless claims number and sluggish growth in the 1 st quarter would increase the chance of two rate cuts in this year. Additionally, higher put base near the 2300 strike would act as strong support .
* MCX Gold Aug is expected to hold the key support near 70,800 and move back towards 72,000. Formation of bullish engulfing pattern on the daily charts would help the metal to regain its strength. Only close below 70,800, it would weaken towards 70,200.
* MCX Silver September is expected to hold the 50 day EMA support near 88,500 and rise towards 90,500. Only close below the recent bottom of 88,200 it would turn weaker.
Base Metal Outlook
* Copper prices are expected to remain under pressure amid demand concerns and surge in inventory levels in major exchanges. Sluggish growth in the housing sector despite recent measures from the Chinese official would weigh on the metals. Low local premiums in China contradicts the copper market tightness. However, any sign of stimulus from China would limit the downside in the metal. Meanwhile, focus will remain on US core PCE data, which could give further clarity on interest rate path from Fed.
* MCX Copper July is expected to dip towards the 100 day EMA support at 828, as long as it trades under 845. Only close below 828 it would open the doors towards 820 mark.
* Aluminum is expected to trade weak and move towards 226, as long as it remains under 231 mark.
Energy Outlook
* NYMEX Crude oil is expected to hold the support near the $80.50 mark and move towards the $83.50 mark amid supply concerns. Escalating Mideast tension and decline in oil exports from Russian due to recent attacks on the oil refinery would support the oil to hold firms. On the other hand, growing probability of two rate cuts in this year would also support the oil prices to trade above the key support at $80.50. Moreover, fresh addition of OI at OTM and ATM put strikes indicates price to hold strong support and rise towards $83.
* MCX Crude oil July is likely to hold the 10 day EMA support near 6720, and move higher towards 6900. Above 6900. it would rise towards 7000. Bullish cross over of 10 and 20 day EMA along with strength in the oscillator (RSI at 61) would support the oil prices to extend its rally.
* MCX Natural gas July is likely to dip towards the immediate support near 220, as long as it trades under the 10 day EMA at 232. Only close below 220, it would weaken further towards 214.
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