MCX Silver September is expected to hold the support near 20 day EMA 89,000 and rise towards 90,500 - ICICI Direct
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Bullion Outlook
Metal’s Outlook
* Spot gold is expected to hold its ground near $2300 and rise towards $2345 on increasing bets that the Federal reserve will start reducing interest rates this year. Moderation in US consumer spending along with rising continuous claims would push the Fed to lower its rates. Further, expectation of weaker JOLTs job opening reports would also support the bullions to trade higher. Meanwhile, focus will remain on Fed chair’s speech which could bring more clarity in its direction.
* MCX Gold Aug is expected to hold the key support near 71,200 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 support near 20 day EMA 89,000 and rise towards 90,500. Only move below, 89,000 it will slide towards 88,200.
Base Metal Outlook
* Copper prices are expected to trade lower amid demand concerns from the top metal consumer China. Weaker than expected manufacturing activity in major economies would hurt the demand outlook of the metal. Further, surge in inventory levels and low local premiums in China contradicts the copper market tightness. Meanwhile, focus will remain on key economic numbers from US and comments from Federal Reserve officials.
* MCX Copper July is expected to face the hurdle near 10 day EMA at 850 and move lower towards 834. Bearish crossover of 10 and 20 day EMA along with weakness in the RSI would weigh on the metal.
* Aluminum is expected to trade weak and move towards 228, as long as it remains under 233 mark. Increasing production from China and higher LME inventory would check its upside.
Energy Outlook
* NYMEX Crude oil is expected to rise further towards $85 mark amid rise in demand over the summer driving season in US. Further, increasing geopolitical tension in the Middle east would hurt global supplies. A decrease in crude oil production in June by OPEC would support the prices. Further, expectation of lower production from US ahead of the hurricane season would support its gains. Meanwhile, focus will remain on US Jolts job opening numbers and speech from the Fed chair Powell which could give further clarity on timing of rate cut.
* MCX Crude oil July is likely to rise towards 7080, as long as it holds above the 10 day EMA at 6800. Strength in the oscillator (RSI) and bullish cross over of 5 and 10 day EMA would support it to trade higher.
* MCX Natural gas July is likely to dip towards 204, as long as it trades under the 5 day EMA at 220
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