Most non-agro commodities traded higher on the back of a weaker dollar. Bullion prices rose on disappointing US economic data and inflation concerns. Non-ferrous trading was volatile, while crude oil prices rebounded in the evening session in hopes of a recovery in demand.
Here’s a look at how different products perform in today’s market:
Bullion prices are stable, with COMEX spot gold trading at around $ 1,789 an ounce and spot silver at around $ 26.75 an ounce. Prices bounced on Monday driven by weak US manufacturing PMI data. Precious metals also received support from concerns about inflation and falling bond yields, despite assurances from Treasury Secretary Jenneth Yellen. Bullion prices are expected to trade sideways throughout the day.
MCX Gold (June) faces resistance at Rs 47,600 per 10 grams and finds support at Rs 46,900 per 10 grams. For MCX silver (May), support is at Rs. 68,500 per kilogram and resistance at 71,500 rupees per kilogram.
Forecast: crude oil
Crude oil prices declined slightly from the benchmark NYMEX WTI, with oil prices in morning trading at around $ 64.38 a barrel. Crude oil prices rebounded in Monday evening session as demand outlooks in Europe and the US neutralized India’s pandemic fears. The European Union intends to loosen restrictions for the upcoming peak summer tourist season, while states in the New York City area of the United States are likely to lift most of the COVID-19 bandwidth restrictions for businesses. We expect crude oil prices to trade sideways during the day.
For MCX Crude Oil (May) futures, support is at Rs 4,720 per barrel and resistance is at Rs 4,850 per barrel.
Forecast: base metals
Most of the major metals, with the exception of copper and zinc, traded mixed amid a weak dollar and hopes for a recovery in demand in Europe following the easing of Covid-19 restrictions. Aluminum prices rose amid concerns over supply disruptions from China. Copper and zinc limited upside potential amid weak US industrial production data. The non-ferrous package is expected to trade sideways with an increase during the day.
For the MCX copper (May), support is at Rs 757 and resistance is at Rs 765. For the zinc MCX (May), support is at Rs 230 and resistance is at Rs. 237. For the nickel MCX (May), support is at Rs 1,290 and resistance at Rs 1,350.
(Tapan Patel, Senior Analyst (Commodities) at HDFC Securities)
MCX gold futures moved higher as the bulls managed to hold it above the immediate resistance of 47100. The Doji Star candlestick pattern at the lower end gave the bulls an edge. Immediate support is now at 47000 and strong support is around 46800. Similarly, near-term resistance is pegged at 47400 and strong resistance is at around 47800. Price is trading above the 8 and 20 DMAs, with 8 DMAs crossing the 20 DMA. This is a short-term bullish indicator. The RSI climbed above 50, supporting the bullish outlook. Based on the above evidence, we expect the price to trade with a bullish bias today. A breakout of 47400 could push it towards 47600.
Buy MCX gold in June at Rs 47,050 with a target of Rs 47,600/47,600 with stop loss at Rs 46,800.
Silver MCX went out of range ahead of gold. The bulls broke through the 69,500 rupee resistance, which was very strongly held by the bears, and pushed the price above the 71,000 rupee mark. It looks like a reverse HNS pattern is forming, which may lead prices to further rise. The crossover of the 8-day moving average above the 20-day moving average is positive for the price. The momentum RSI indicator supports a bullish case. Immediate support is fixed at Rs 70,400, followed by Rs 69,500 and resistance at Rs 71,200 followed by Rs 71,800. Silver is expected to trade in a positive trend. A breakout of Rs 71,200 could push the price up to higher levels of Rs 71,800.
Buy MCX silver July at Rs 70,400 with a target price of Rs 71,800 with stop loss at Rs 69,500.
(Ravindra Rao, CMT, EPAT, VP of Commodity Research at Kotak Securities)