Commodity prices traded higher on Monday as bullion and energy complex ended in the green zone, while base metals traded under pressure for the day. Silver prices continued to soar on Reddit buying spree, gaining nearly 11 per cent in a day’s trade. The dollar index ended higher by 0.44 per cent for the day limiting upside in the prices.
Bullion prices traded under pressure with spot gold prices at COMEX was trading at $1,855 per ounce while spot silver prices at COMEX was trading nearly 2 per cent down to $28.40 per ounce witnessing profit booking. Silver prices are trading weak after witnessing strong rally in the past few sessions while gold prices are trading in a lower range on lack of fresh triggers and delay on the front of new stimulus package in the US. We expect bullion prices to trade sideways to down for the day.
MCX Gold April resistance for the day lies at Rs. 48,700 per 10 grams with support at Rs. 47,900 per 10 grams.
MCX Silver March support lies at Rs. 69,000 per KG, resistance at Rs. 74,000 per KG.
Outlook: Crude Oil
Crude oil prices traded higher with benchmark NYMEX WTI crude oil prices was trading 1 per cent up to $54.11 per barrel. Crude oil prices have regained momentum on fuel demand recovery hopes over vaccine rollouts. The effect of output cuts from OPEC plus and Saudi Arabia has also supported oil prices to trade firm for the day. Crude oil prices are expected to trade sideways to up for the day.
MCX Crude Oil February support lies at Rs. 3,890 per barrel with resistance at Rs. 3,990 per barrel.
Outlook: Base Metals
Base metals complex traded under pressure on Monday with Copper prices declined at MCX after Government of India reduced import duty on Copper scrap to 2.5 per cent. Base metals traded weak on stronger dollar and slower economic growth despite of vaccine rollouts. Copper prices may get some support as Copper inventories at warehouses tracked by Shanghai Futures Exchange extended declines to the lowest level for this time of the year since 2009 amid better-than usual winter demand. Base metals are expected to trade sideways to down for the day.
MCX Copper February support lies at Rs. 587 and resistance at Rs. 598.
MCX Zinc February support lies at Rs. 201, resistance at Rs. 209.
MCX Nickel February support lies at Rs. 1,270 with resistance at Rs. 1,320.
(Tapan Patel is a Senior Analyst () at HDFC Securities)
MCX Gold April future witnessed sharp decline below the lower band of the range but managed to close above the key support of Rs 48,500 (200 DEMA). Meanwhile, key resistance for April future exists around Rs 49,300 (21 Day EMA), followed by Rs 49,600. On the downside, below Rs 48,500 next key supports hold around Rs 48,050. On the momentum front, RSI is trading around 40 suggesting sideways to weaker trend. For the day price is likely to continue trading in the broad range of Rs 49,300-48,100 with a sideways bias. Only a sustained move below Rs 48,100 would extend downside towards Rs 47,700.
Sell MCX Gold April at Rs 48,600 with a target of Rs 48,100 and a stop loss at Rs 48,800.
MCX Silver March futures witnessed sharp upmove and moved towards the key resistance zone of Rs 74,500. Meanwhile, key support holds around Rs 71,750 (resistance turned support), followed by Rs 69,780 (5 Day EMA) and key resistance exists around Rs 74,500, followed by Rs 76,500. On the momentum front, RSI has moved towards the overbought zone 80 (79), which could trigger some profit taking which might attract buying. For the day, price is expected to move in the range of Rs 69,780-74,500 with a sideways to positive bias. A close above Rs 74,500 would intensify the up move.
Buy MCX Silver March at Rs 70,800 with a target of Rs 74,000 and a stop loss of Rs 69,700.
(Ravindra Rao is VP-Head Commodity Research at Kotak Securities)
(Disclaimer: The opinions expressed in this column are that of the writer. The facts and opinions expressed here do not reflect the views of www.economictimes.com.)
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