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Gold

Gold prices experienced a slight dip of -0.25% to settle at 60,785 due to the Federal Reserve's decision to leave interest rates unchanged, coupled with limited guidance on monetary policy. The US Automatic Data Processing (ADP) reported 113,000 job hires, falling short of the expected 159,000 but surpassing the previous 89,000. The future direction of gold hinges on the Fed's interest rate decision and the Institute of Supply Management's Manufacturing PMI data for October. A potential hawkish interest rate stance is anticipated due to strong household spending and a robust labor market, keeping inflation concerns alive. Moreover, the World Gold Council (WGC) warns that high gold prices may dampen demand in India during the festive season, possibly leading to the lowest purchase volumes in three years. This could limit the rally in global gold prices. Reduced gold imports might also help narrow India's trade deficit and support the rupee. However, the anticipation of higher prices in the December quarter, traditionally a peak sales period, might lead to decreased purchases. In the third quarter, global gold demand trading declined by 6%, driven by lower central bank purchases compared to the previous year's record levels and reduced consumption by jewelers, as reported by the WGC. From a technical perspective, the gold market is currently experiencing long liquidation, with a decrease in open interest by -3.94% to 14,086, and prices dropping by -155 rupees. Support levels are at 60,575 and 60,365, while resistance is expected around 61,080, with a potential price test at 61,375.
 

Trading Ideas:
 * Gold trading range for the day is 60365-61375.

* Gold dropped as Fed leaves interest rates unchanged and provides little forward guidance on its monetary policy.
* Middle East tensions keep the broader appeal for Gold bullish.
* Indian gold demand loses lustre in peak festive season as prices rally

Silver

Silver prices faced a decrease of -0.52% to close at 71,298, influenced by the strengthening US dollar in anticipation of the Federal Reserve's monetary policy announcement. The US 10-year Treasury note also declined below 4.8%, reflecting market reactions to the Treasury's refunding news and economic data preceding the Fed's rate decision. While rates are expected to remain unchanged, the market is keen to gauge the central bank's assessment of the US economy and potential hints about future monetary policy. On the international front, the European Central Bank's tightening measures paused due to slowing Euro Area inflation. Geopolitical concerns related to the Middle East lent some support to silver prices. US manufacturing exhibited a sharp contraction in October, largely due to issues like labor strikes by the United Auto Workers (UAW) against major car manufacturers. The Institute for Supply Management (ISM) reported a drop in the manufacturing PMI to 46.7 in October, marking the 12th consecutive month below 50, indicating contraction. Similarly, the S&P Global/CIPS UK Manufacturing PMI recorded a slight decrease to 44.8 in October, with ongoing production decline. From a technical perspective, the silver market is experiencing fresh selling, with a 5.36% increase in open interest to 19,996, while prices declined by -371 rupees. Support levels are at 70,800 and 70,300, with resistance anticipated at 71,880 and a potential price test at 72,460.
 

Trading Ideas:
* Silver trading range for the day is 70300-72460.
* Silver prices dropped as the dollar extended its uptick ahead of the Fed’s monetary policy announcement.
* The European Central Bank's tightening cycle appeared to have come to a halt in response to data revealing a significant deceleration in Euro Area inflation.
* Additionally, ongoing concerns related to the conflict in the Middle East continued to provide some support.


Crude oil
Crude oil experienced a slight decline of -0.29% on October 31, 2023, closing at 67.62 per barrel. This drop was primarily driven by concerns regarding the potential negative impact of increased borrowing costs on economic growth and, subsequently, fuel demand. In addition to these concerns, the Energy Information Administration (EIA) reported an unexpected increase in crude oil inventories in the United States. Crude stocks rose by 0.774 million barrels in the week ending October 27, missing market expectations of a 1.261 million barrel increase. Notably, Cushing, Oklahoma, also saw an increase in inventories. Conversely, gasoline stocks experienced a smaller-than-expected rise of 0.065 million barrels, contrary to the anticipated 0.803 million barrel draw. Distillate stockpiles, which include diesel and heating oil, declined by 0.792 million barrels, though this decrease was less significant than the consensus forecast of a 1.540 million barrel drop. The U.S. also achieved a new monthly production record in August, with crude oil output reaching 13.05 million barrels per day. This was a 0.7% increase from the previous month, marking the highest level since November 2019. From a technical perspective, the market is currently experiencing a fresh wave of selling, as evidenced by a 3.07% increase in open interest, reaching 7,287 contracts. Crude oil prices have declined by -20 rupees. Key support levels for the market are at 6681, with the potential to test 6599. On the upside, resistance is expected at 6900, with the possibility of prices testing 7037.
 

Trading Ideas:
* Crudeoil trading range for the day is 6599-7037.
* Crude oil dropped weighed down by concerns that higher borrowing costs will likely hurt demand
* Crude oil inventories in the US rose by 0.774 million barrels
* Gasoline stocks increased by 0.065 million barrels, which contrasts with expectations of a 0.803 million draw.


Natural gas
Natural gas prices experienced a significant decline of -3.25% to settle at 291.4, primarily driven by record output levels and forecasts of milder weather conditions. Lower heating demand expectations over the next two weeks further weighed on prices. The EIA reported that US utilities added 74 billion cubic feet of gas into storage, falling slightly short of market expectations but surpassing the five-year average. LSEG noted an increase in gas output, averaging 104.1 billion cubic feet per day in October, signaling robust production. Additionally, meteorologists predicted a shift from colder than normal weather to near-normal conditions from November 3-14, contributing to reduced gas demand. The Lower 48 states' gas demand, including exports, is anticipated to decrease from 109.2 bcfd this week to 104.2 bcfd next week, reflecting the impact of milder weather expectations. However, pipeline exports to Mexico decreased in October, while gas flows to US LNG export facilities increased. From a technical standpoint, the market saw long liquidation, with a notable -12.97% drop in open interest to 13,445. Prices witnessed a decrease of -9.8 rupees. Support is identified at 285, with a potential test of 278.5, while resistance is expected at 299.2, with the possibility of prices testing 306.9.
 

Trading Ideas:
* Naturalgas trading range for the day is 278.5-306.9.
* Natural gas fell on record output and forecasts for milder weather
* Pressure also seen amid lower heating demand over the next two weeks than previously expected.
* Average gas output in the Lower 48 U.S. states rose to an average of 104.1 billion cubic feet per day (bcfd) so far in October


Copper

Copper prices declined by 0.09% to settle at 706.6 yesterday due to disappointing Chinese manufacturing data, which raised concerns about reduced demand. However, copper production in Chile increased by 4.1% YoY in September. The Caixin/S&P Global manufacturing PMI fell to 49.5 in October, indicating the first contraction since July and missing forecasts. Copper prices are expected to recover modestly next year, driven by growing demand for the energy transition despite global economic challenges. Copper prices have dropped approximately 15% since reaching a seven-month high in January. This decline is attributed to China's weak economic growth, global recession fears, and high interest rates. Analysts predict the cash copper contract on the London Metal Exchange will average $8,625 per metric ton in 2024. Additionally, there's a projected surplus of copper for this year, estimated at 112,000 metric tons, with an expected increase to 302,500 tons in 2024. Notably, stockpiles at the Shanghai Futures Exchange and the London Metal Exchange plummeted by nearly 40% in the week ending October 27th, erasing earlier gains. From a technical perspective, the market is currently experiencing long liquidation, with a 3.06% drop in open interest, settling at 6749. Copper's price is down by 0.65 rupees. Support for copper is at 704, with potential testing of 701.5 levels, while resistance is likely at 710.4, and a move above that level could see prices testing 714.3.
 

Trading Ideas:
* Copper trading range for the day is 701.5-714.3.
* Copper prices gains as Copper output in Chile, rose 4.1% year-on-year in September to 457,393 tons.
* The Caixin/S&P Global manufacturing PMI fell to 49.5 in October from 50.6 in September.
* Copper price seen at average $8,625/T in 2024, up 7%

Zinc

Zinc prices rose by 1.44% to settle at 222.2 due to Nyrstar's decision to temporarily close two zinc mines in Tennessee, citing weak prices and inflationary pressures. This move underscores the challenges faced by the zinc market. Additionally, China's manufacturing PMI fell to 49.5 in October, signaling a fragile economic recovery. The global refined zinc market is now expected to experience a surplus of 248,000 metric tons in 2023, a significant shift from the previously projected deficit of 45,000 tons, mainly driven by lower-than-expected demand. China's refined zinc output in September increased by 3.31% month-on-month and 7.94% year-on-year, but this growth was below expectations. Cumulatively, refined zinc production in China saw a year-on-year increase of 9.84% from January to September. Domestic zinc alloy production also saw a slight uptick in September, reaching 88,200 metric tons. From a technical standpoint, the market witnessed short covering, with a decrease in open interest by -7.09% to 3933, while prices rose by 3.15 rupees. Zinc's support level stands at 218, with a potential test of 213.7 if it falls below this level. Resistance is expected at 226.8, and a breakout above this level could lead to price testing 231.3.
 

Trading Ideas:
* Zinc trading range for the day is 213.7-231.3.
* Zinc gains as Nyrstar says to suspend operations at two U.S. zinc mines
* Global zinc market surplus widens in August – ILZSG
* The global zinc market to show a surplus of 148,000 metric tons this year and 238,000 tons in 2024.


Aluminium

Aluminium prices experienced a minor decline of -0.12% to settle at 206.25 due to a significant development in China's aluminium industry. Chinese aluminium smelters in Yunnan province initiated a capacity cut of 1.15 million metric tons, as required by a recent curb imposed by China Southern Power Grid, effective until April. This restriction, issued on October 30, mandated local producers to reduce production by 9% to 40% of their capacity. Yunnan, the fourth-largest aluminium producing region in China, holds approximately 12% of the country's total capacity, and the region had seen capacity growth driven by cheap hydropower. However, water shortages have started to impact production. In 2023, global aluminium production has been on the rise, especially in Europe as power prices stabilized, and in China's Yunnan province, following the relaxation of hydro power restrictions. Nevertheless, subdued demand resulting from weak economic conditions, notably in Europe, has led analysts to revise their outlook on the aluminium market. Instead of expecting deficits in 2023 and 2024, they now anticipate surpluses of 338,000 tons and 250,000 tons, respectively. From a technical perspective, the market has seen a decline in open interest by -1.11%, settling at 3020, alongside a price decrease of -0.25 rupees. Currently, aluminium finds support at 205.5, with the potential to test 204.8 levels, while resistance is likely at 207.3, with the possibility of prices testing 208.4.
 

Trading Ideas:
* Aluminium trading range for the day is 204.8-208.4.
* Aluminium gains as China's Yunnan begins aluminium production cuts as dry season begins
* Global aluminium production has ramped up this year as smelters come back on line in Europe
* Market surpluses of 338,000 tons this year and 250,000 tons in 2024, an about-face from deficits 191,750 tons

Cottoncandy

Cottoncandy, the cotton market, experienced a slight uptick of 0.03%, closing at 58,340 due to concerning factors in the cotton industry. India is anticipating a 7.5% drop in cotton production for the 2023/24 season, attributed to decreased planting and El Nino's adverse impact on productivity. This has led to predictions of increased cotton imports in India, reaching 2.2 million bales. The USDA's October WASDE report also painted a gloomy picture, reducing the U.S. cotton production estimate for 2023/24 to 12.8 million bales, citing lower yields in Texas. In a significant development, Brazil is poised to outproduce the United States for the first time in cotton production, and it's on the brink of surpassing U.S. cotton exports, a historic shift. Australia capitalized on improved trade relations with China, with cotton exports surging to 61,319 metric tons worth $130 million in August, the highest since 2014. The Cotton Association of India (CAI) released its final estimate for the 2022-23 season, slightly higher at 31.8 million bales, contrasting the government's estimate of 34.3 million bales. Looking ahead, India is gearing up for the 2023-2024 cotton season with an expected production of 33-34 million bales. In Rajkot, a major cotton spot market, prices dipped by -0.56% to close at 27,357 Rupees. From a technical perspective, the market saw short-covering, with open interest remaining unchanged at 107, while prices increased by 20 rupees. Cottoncandy is currently finding support at 58,060, with potential testing of 57,790. On the upside, resistance may emerge at 58,600, and if breached, prices could test 58,870.
 

Trading Ideas:
* Cottoncandy trading range for the day is 57790-58870.
* Cotton gains as India's cotton production in 2023/24 is likely to fall 7.5%.
* 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 27357 Rupees dropped by -0.56 percent.

Turmeric

Turmeric prices surged by 4.54% to settle at 14,034 due to concerns over potential yield losses caused by unfavorable October weather. The anticipation of drier-than-average conditions in October, according to IMD, is expected to impact crop growth. However, this price rally is somewhat limited as current crop conditions remain favorable, with harvest readiness expected from January to March. Despite the recent price increase, the market appears to be supported by a combination of factors. Buying activity remains robust, and supplies are decreasing, contributing to price stability. Export opportunities for turmeric have improved significantly, with a 25% increase in exports to both developed and emerging nations. One notable factor affecting this year's turmeric production is the expected decline of 20-25% in seeding, especially in regions like Maharashtra, Tamil Nadu, Andhra Pradesh, and Telangana. Farmers have shifted their priorities, leading to reduced planting. Looking at recent export data, turmeric exports from April to August 2023 rose by 11.51% compared to the same period in 2022. However, there was a drop in August 2023, with 11,322.58 tonnes exported, an 18.20% decrease from July 2023 and a 6.67% decrease from August 2022. In terms of technical analysis, the market has witnessed short covering, with open interest declining by -1.49% to settle at 13,255. Turmeric is currently finding support at 13,624, and a breach of this level could lead to a test of 13,216. On the upside, resistance is expected at 14,286, and a move above this level could push prices towards 14,540.
 

Trading Ideas:
* Turmeric trading range for the day is 13216-14540.
* Turmeric gains due to the potential for yield losses caused by the crop's anticipated unfavourable October 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 13597.95 Rupees gained by 1.01 percent.

Jeera

The recent decline in jeera prices by -1.4% to 43,100 Rupees is linked to promising weather conditions supporting healthy crop sowing, triggering stockists to buy due to a recent price drop. However, the consistent availability of quality produce is limited, offering support amidst the downward trend. Global demand for Indian jeera has declined as buyers opt for other sources due to comparatively higher Indian prices. This decrease in demand reflects in the dropping export volumes, exhibiting a 23.76% decrease from Apr-Aug 2023 compared to the same period in 2022. The subdued global demand stems from India's price competitiveness but doesn't favor exporters. Additionally, the possibility of Chinese purchase of Indian cumin ahead of new arrivals adds further uncertainty. The market dynamics, as predicted by FISS, show a potential imbalance in demand and supply this year, with demand likely exceeding the supply. In the technical landscape, the market is witnessing long liquidation with a decrease in open interest by -6.19% while prices dropped by -610 rupees. Support for jeera stands at 41,900 Rupees, with a potential test of 40,700 levels. Resistance is anticipated at 44,600 Rupees, and a move beyond this could push prices to test 46,100 Rupees.
 

Trading Ideas:
* Jeera trading range for the day is 40700-46100.
* Jeera dropped as adequate soil moisture, and favorable weather condition for crop will boost the overall sowing activities.
*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 44750.7 Rupees gained by 1 percent.

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