Home Market Commodity outlook: Bullion may find it hard to bolt free

Commodity outlook: Bullion may find it hard to bolt free


Gold and silver prices strengthened on Friday, in tune with fresh demand for the precious metals from investors, industries, stockists and retailers.

MCX Gold futures ruled firm by 0.38 per cent at Rs 30,284 per 10 grams at around 10.25 am (IST). Silver futures were up 0.33 per cent at Rs 36,981 per kg at around the same time.

How do key commodities come up today? Let's take it from brokerage SMC Global Securities.

Bullion: Bullion may move sideways with a mixed bias as some lower level buying can be seen. “Gold can take support near 30,050 and can face resistance near 30,350 in MCX. Silver (December) can take support near 37,500 and has resistance near 37,850. The dollar index against a basket of six major currencies stood little changed at 94.709.

Base metals: Base metals may have a weak bias because of ongoing trade war worries. Meanwhile, growth in China's manufacturing sector unexpectedly picked up in August after sliding for two months, official data showed on Friday, a sign that economic activity is still fairly resilient despite weak investment and an escalating trade battle with the US.

Growth in China's booming steel industry slowed in August, with output leveling off despite a sharp rebound in export orders, industry data showed on Friday. Copper (November) can face resistance near 435 and take support near 425. London copper prices fell in early Asian trade on Friday, weighed down by reports that the US is ready to impose tariffs on $200 billion more of Chinese goods as soon as the end of next week, even as growth in China's manufacturing sector beat expectations.

London Metal Exchange copper has moved lower for three straight sessions and is on course for a monthly drop of 4.2 per cent in August, after a 4.9 per cent plunge in July, amid fears that the trade spat will hurt demand for industrial metals.

Zinc can face a hurdle near 179 and support near 174 while lead can take comfort near 145, with a likely barrier near 149. Nickel can find relief near 930 while its upside will be capped near 955. Aluminium can move sideways as it can get some backing near 149, but face headwinds near 153.

Energy: Crude oil may witness some profit booking after the recent rise as oil prices dipped on Friday amid concerns that the trade dispute between Washington and Beijing could intensify.

With Venezuelan supply falling sharply and concerns around US sanctions against Iran that will target its oil exports from November, crude markets in August are on track to post a more than 4 per cent rise for Brent and a 2 per cent increase for WTI.

Russia and several other non-OPEC countries have joined OPEC producers in reducing oil output since 2017 in a move that has helped raise oil prices to $80 per barrel from less than $30. Moscow and Riyadh have said they want to maintain a close level of cooperation even after the oil market stabilises and the current output reduction deal expires.

Crude oil can take support near 4,920 and may face resistance near 5,050 on MCX. Natural gas may stay on a mixed path as it can take support near 201 but face resistance near 206.

Spices: Turmeric futures (September) are expected to trade sideways to down in 6,750-6,850 levels. The price of the both varieties of turmeric cane down again. For want of proper upcountry demand and also poor quality, traders quoting decreased price have purchased for their requirement alone.

As for the price, finger turmeric fell by Rs 400 a quintal at the Regulated Marketing Committee and Rs 300 each in Erode Turmeric Merchants Association Sales yard and Erode Cooperative Marketing Society.

Jeera futures will possibly face resistance near 19,600 levels.

Coriander futures are expected to trade with a downside bias and test 4,500. On the spot markets, the buyers are silent as demand declines during monsoon season.

Cardamom futures are expected to face resistance near 1,400 levels. The insecticide ban by Saudi Arabia on Indian consignment from September 1 will give a bearish impact on cardamom prices.

Oil seeds: Soybean futures (October) will possibly see a consolidation in 3,170-3,250 levels. The enquiries for Soybean meal has not picked up even if the rupee is depreciating against the dollar.

Mustard futures (September) may witness a consolidation in 3,950-4,025 levels. Mustard seed prices slipped at the key markets of Rajasthan due to reports that Nafed may liquidate mustard seed at market rates rather than MSP due to low market participants.

Soy oil futures may witness a consolidation in 728-732 levels. Similarly, CPO futures may witness a consolidation in 592-600 levels.

Original Article


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