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GOLD

Gold prices climbed 0.45% as the dollar weakened, driven by anticipation of Federal Reserve Chair Jerome Powell's speech. Powell's remarks are expected to shed light on interest rates. Federal Reserve Governor Michelle Bowman suggested the potential for more rate hikes due to the strong economy, while Minneapolis Fed President Neel Kashkari cautioned against premature claims of victory over inflation. In Europe, central bank officials, including Gabriel Makhlouf and Joachim Nagel, discussed the potential for further tightening and the challenges in reaching inflation targets. Meanwhile, the U.S. Labor Department reported a decrease of 3,000 in weekly jobless claims to 217,000, though they remain elevated since early September. The four-week moving average for new claims rose, suggesting underlying labor market volatility. The increase in ongoing benefits recipients reflects the ongoing difficulty for job seekers. Technically, the gold market experienced short covering, with open interest declining by 10.12% while prices surged by 273 rupees. Gold finds support at 59910, with a possible test of 59540 if breached, while resistance is at 60500. A breakthrough above this level could propel prices toward 60720.

Trading Ideas:

* Gold trading range for the day is 59540-60720.
* Gold rose as the dollar eased, with investors awaiting Federal Reserve Chair Jerome Powell's speech for clarity on interest rates.
* Federal Reserve Governor Michelle Bowman flagged the possibility of further rate hikes due to the strength of the economy
* The Federal Reserve has said that it needs to see some weakness in the U.S. labor market before it starts looking at potential rate cuts.

 

SILVER

Silver prices increased by 0.23% as the dollar faced challenges following comments from Federal Reserve officials regarding the bank's policy stance. There's a mix of views, with Vice Chair Philip Jefferson indicating potential aggressive policy responses due to high uncertainty, and Fed Chair Jerome Powell remaining silent on policy or economic outlook in his recent remarks. On the global stage, European Central Bank VP Luis de Guindos ruled out talks of reducing borrowing costs. In the Middle East, there's a cautious optimism regarding Israel-Palestine tensions. Economic indicators showed deflation in the Chinese economy due to weakened consumer spending and unexpected factory data decline. U.S. jobless claims slightly decreased by 3,000 but lingered near 7-week highs, while continuing claims rose, suggesting challenges for the unemployed in finding new jobs. From a technical perspective, the silver market experienced short covering with a drop in open interest by 8.18%, accompanied by a price increase of 163 rupees. Silver finds support at 70365, with a potential test at 69520 if breached, while resistance is at 71895. A breakthrough above this level could push prices towards 72580.

Trading Ideas:

* Silver trading range for the day is 69520-72580.
* Silver settled higher as the dollar struggled a bit after some Federal Reserve officials comments
* Fed’s Jefferson said that high uncertainty could warrant an aggressive, rather than a gradual, policy response.
* ECB’s Guindos that any talk of lowering borrowing costs in the coming months is clearly premature

 

CRUDE OIL

Crude oil prices surged by 1.56% in a modest recovery following concerns over demand and a decrease in the war-risk premium, which triggered a recent selloff. Anticipated easing of U.S. sanctions on Venezuela is expected to marginally raise oil production, with an estimated increase of less than 200,000 barrels per day to an average of 900,000 bpd by the end of 2024. The U.S. Energy Information Administration highlights the challenges, stating that significant investment is required for substantial production increases due to years of deferred maintenance and limited capital access. EIA adjusted its forecast for this year's crude output growth slightly lower than expected, forecasting a rise to 12.9 million bpd in 2023. However, the agency predicts a decrease in petroleum and liquid fuels consumption to 20.1 million bpd, contrary to the previous consumption rise projection. U.S. crude oil shipments via rail in August fell by 14,000 bpd to 244,000 bpd from the prior month. Technically, the crude oil market saw short covering, with a 20.01% drop in open interest and a price increase of 98 rupees. Support for crude oil is at 6293, with a potential test at 6214 if breached, while resistance is anticipated at 6441. A move above this level could lead prices toward 6510.

Trading Ideas:

* Crudeoil trading range for the day is 6214-6510.
* Crude oil gains on low level recovery after prices dropped on demand concerns.
* Venezuela's oil output to rise modestly after US sanctions relief – EIA
* US crude output to rise by less than previously forecast in 2023 – EIA
 

NATURAL GAS

Natural gas prices experienced a minor decrease by -0.12% due to high output levels and the persistence of mild weather forecasts through late November. Record production in October and a continued rise in November has led to about 6% more gas in storage than the typical volume for this time of year. The expectations of extended warmer weather are suppressing heating demand, impacting the necessity for natural gas. Although gas flows to U.S. LNG export facilities are rising, they remain below the peak levels seen in April. Exports to Mexico have declined after a record high in September, awaiting a potential boost when New Fortress Energy's plant initiates LNG exports. LSEG predicts a rise in daily gas output in the Lower 48 U.S. states, estimating an increase from 104.2 billion cubic feet per day (bcfd) in October to 106.6 bcfd in November. Despite the high output, the forecast suggests a drop in U.S. gas demand, including exports, from 109.9 bcfd to 101.3 bcfd due to milder weather reducing heating demand. This demand is expected to surge back to 108.9 bcfd with the arrival of colder weather. From a technical perspective, the natural gas market witnessed fresh selling with a 7.5% rise in open interest, although prices experienced a slight decrease of -0.3 rupees. Support for natural gas stands at 251.6, with a potential test at 246.4 if breached, while resistance is likely at 263.1. A breakthrough above this level could lead prices to 269.4.

Trading Ideas:

* Naturalgas trading range for the day is 246.4-269.4.
* Natural gas dropped on record output and forecasts for mild weather to continue through late November
* Natural gas production has been on the rise in November, following a record high in October.
* Additionally, there is currently about 6% more gas in storage than is typical for this time of year.

 

COPEER

Copper prices saw a marginal increase of 0.13% as China announced plans to bolster demand and increase industrial metal imports significantly. With a commitment to open its economy, China aims to elevate commodity and service imports to nearly $17 trillion in the next five months. China's copper imports surged by 23.7% in October compared to the previous year, driven by low inventories and robust demand across construction, transport, and power sectors. Amid dwindling domestic copper stocks in China, demand traditionally peaks in September and October as industrial activities revive post-summer. Additionally, heightened consumer spending during the Golden Week holiday in early October contributes to increased demand. Despite an initial decrease in copper inventories, a subsequent rise of 11.2% provided a buffer by early November. The market is keeping a close eye on China's demand outlook, especially as Beijing plans to inject CNY 1 trillion in additional debt to stimulate manufacturing and infrastructure construction. From a technical standpoint, the market observed short covering with a 1.59% drop in open interest while prices rose by 0.95 rupees. Copper finds support at 701.9, with a potential test at 698.7 if breached, while resistance is likely at 707.6. A move above this level could drive prices toward 710.1.

Trading Ideas:

* Copper trading range for the day is 698.7-710.1.
* Copper prices rose as China commits to boosting demand and industrial metal imports
* Chinese officials asserted at a commercial show in Shanghai that China will open its economy and will boost imports of commodities
* China's copper imports jumped 23.7% in October from a year earlier, customs data showed
 

ZINC

Zinc prices registered a modest increase of 0.11% due to growing concerns about supply disruptions. Reports of a fire at the Ozernoye mine project in Russia and recent mine suspensions have heightened these concerns. The Russian mine, developing a substantial zinc-lead mine in Buryatia, reportedly had a fire, further straining supply. LME zinc inventories have significantly decreased since early September, contributing to supply worries. Last week, Nyrstar announced its intention to temporarily close two U.S. zinc mines by the end of November, citing weak prices and the impact of inflation. This is the third instance of zinc operations being suspended by producers in recent months. China's economic conditions add to these concerns as the manufacturing PMI fell to 49.5 in October, highlighting a fragile recovery. The global refined zinc market is now expected to have a surplus of 248,000 metric tons this year, in contrast to the prior projection of a 45,000-ton deficit, primarily due to lower-than-anticipated demand. Technical observations reveal short covering, with a 2.48% drop in open interest and a price increase of 0.25 rupees. Support for zinc is at 227.4, with potential testing at 226.1 if breached, while resistance is anticipated at 229.8. A move above this level could lead prices to 230.9.

Trading Ideas:

* Zinc trading range for the day is 226.1-230.9.
* Zinc rose on concerns about supply after reports of a fire at a Russian mine project
* Adding to supply concerns, LME zinc inventories have more than halved since early September.
* Nyrstar said it planned to temporarily close two U.S. zinc mines at the end of November


 

ALUMINIUM

Aluminium prices experienced a decline of -0.67% due to concerns surrounding the uncertainty in China's economic recovery. A contraction in consumer prices and persistent factory-gate deflation in October raised doubts about a robust resurgence in China's economy. Mixed economic indicators showed a slowdown in manufacturing activities and exports, alongside unexpected growth in imports. Chinese authorities pledged to open up the economy and boost commodity and service imports to nearly $17 trillion in the next five months, while market sentiment remained cautious amid developments concerning Chinese property giant Country Garden. The US dollar weakened after the US monthly payrolls report, enhancing expectations of a potential interest rate hike by the Federal Reserve in December.The ongoing monitoring of industrial metals imports in China, coupled with consumer prices, will gauge the effectiveness of Chinese stimulus measures. Despite the US trade deficit widening to $61.5 billion in September, it is the third-lowest since 2021. From a technical perspective, the aluminium market observed fresh selling with a 0.62% increase in open interest, while prices dropped by -1.4 rupees. Support for aluminium stands at 205.7, with a potential test at 204.8 if breached, while resistance is likely at 207.5. A move above this level could push prices toward 208.4.

Trading Ideas:

* Aluminium trading range for the day is 204.8-208.4.
* Aluminium dropped as uncertainty in the economic recovery in China, weighed.
* China’s manufacturing activities and exports slowed in October, but imports unexpectedly grew.
* Sentiment was also cautious as traders and investors eyed developments in troubled Chinese property giant Country Garden.

 

COTTON

Cotton prices declined by -0.8% due to concerns over Chinese demand during the ongoing harvest season. India anticipates a 7.5% decline in cotton production in 2023/24 due to reduced planting and El Nino weather conditions. The Cotton Association of India (CAI) expects higher imports for this year. USDA reported a decrease in U.S. cotton production to 12.8 million bales for 2023/24, attributing it to reduced yields in Texas. Brazil's cotton production is predicted to surpass the U.S., potentially leading to greater exports. India's cotton production for the 2022-23 season was estimated by CAI at 31.8 million bales, higher than initial estimates but slightly lower than government estimates. The upcoming season may witness a production range of 330-340 lakh bales. In Rajkot, a significant market, cotton prices settled at 26908 Rupees, a drop of -0.2 percent. From a technical viewpoint, the cotton market experienced fresh selling, with a 4% increase in open interest and a price decrease of -460 rupees. Support for cotton stands at 56320, with a potential test at 55790 if breached, while resistance is likely at 57300. A move above this level could push prices to 57750.

Trading Ideas:

* Cottoncandy trading range for the day is 55790-57750.
* Cotton dropped pressured by concerns about demand from China as the harvest season for the natural fiber progressed.
* Imports could rise to 2.2 million bales in the marketing year that started on Oct. 1, up from the last year's 1.25 million bales
* USDA cut U.S. production in 2023/24 to 12.8 million bales
* In Rajkot, a major spot market, the price ended at 26908 Rupees dropped by -0.2 percent.
 

TURMERIC

Turmeric prices recorded a modest increase of 0.21% due to concerns over potential yield losses caused by unfavorable weather conditions. However, the upside appears limited as crop conditions have improved with favorable weather. The crop is expected to be ready for harvest between January and March. The Indian Meteorological Department (IMD) predicts drier-than-average conditions in October, impacting crop growth. Despite this, current buying activity and decreasing supplies are likely to sustain price stability. Improved export opportunities have also provided support, with a 25% increase in turmeric exports driven by rising demand in both developed and emerging markets. Turmeric exports from April to August 2023 increased by 11.51% to 82,939.35 tonnes compared to the same period in 2022. However, August 2023 witnessed a drop of 18.20% compared to July 2023 and a 6.67% drop compared to August 2022. The IMD defines average rainfall as ranging between 96% and 104% of the 50-year average of 87 cm for the season. In Nizamabad, a major spot market, turmeric prices closed at 13445.65 Rupees, a decrease of -0.7 percent. From a technical perspective, the turmeric market saw short covering with a 1.87% drop in open interest and a price increase of 28 rupees. Support for turmeric is expected at 13310, with a potential test at 13112 if this level is breached. Resistance is likely at 13628, and a move above could push prices to 13748.

Trading Ideas:

* Turmeric trading range for the day is 13112-13748.
* Turmeric gained due to the potential for yield losses caused by the crop's unfavourable weather.
* However, upside seen limited amid improved crop condition due to favorable weather condition.
* Expectations for a 20–25 percent decline in turmeric seeding this year
* In Nizamabad, a major spot market, the price ended at 13445.65 Rupees dropped by -0.7 percent.


 

JEERA

Jeera witnessed a 1.5% increase due to short covering post a price drop. The favorable weather and sufficient soil moisture are likely to boost sowing activities, maintaining a normal sowing outlook. Short-term interest from stockists led to the recent price rebound, while global demand for Indian jeera remained low due to competitive prices in other countries like Syria and Turkey, influencing subdued overseas sales. Export activities are expected to stay suppressed as Indian jeera's price competitiveness doesn't favor exporters currently. China's potential purchase of Indian cumin in October-November might add market uncertainty. As per FISS forecasts, cumin demand might exceed supply this year, with supply likely to reach 65 lakh bags against a demand of 85 lakh bags. Jeera exports between April and August 2023 saw a significant drop by 23.76% compared to the same period in 2022. In August 2023, 8,081.60 tonnes were exported, down 66.98% from the previous year. Prices in Unjha, a major spot market, increased marginally to 45429.75 Rupees, rising by 0.04%. Technically, the market experienced short covering, with a drop in open interest by -2.53% and a price surge of 645 rupees. Jeera has support at 43060, a potential test at 42360 if this level breaks, and resistance at 44230. A move above this resistance could lead to a test of 44700.

Trading Ideas:

* Jeera trading range for the day is 42360-44700.
* Jeera gained on short covering after prices dropped as adequate soil moisture, and favorable weather condition for crop will boost sowing.
* The upcoming sowing of jeera that is expected to remain normal due to favorable weather condition.
* Stockists are showing interest in buying on recent downfall in prices triggering short covering.
* In Unjha, a major spot market, the price ended at 45429.75 Rupees gained by 0.04 percent.

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