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Commodity methods: Gold, silver, crude, base metals

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By Tapan Patel

As bears returned to the fairness market on Wednesday, with Asian shares retreating on coronavirus resurgence and fading US stimulus hopes, commodities confirmed blended response. Crude oil costs might keep the higher buying and selling vary amid expectations of a bullish weekly stock knowledge. Here is a have a look at how totally different commodities are behaving in at present’s market.

Outlook: Bullion

Bullion costs traded greater on Wednesday as COMEX spot gold costs went above $1,900 per ounce, whereas spot silver costs at COMEX ended half a per cent up for the day. Bullion is awaiting contemporary triggers as costs are buying and selling within the vary of $1,880-$1,920 attributable to greenback fluctuations over US stimulus worries and issues over surge in virus circumstances. ETF holdings at SPDR gold shares continued to surge at 1,277.94 tonnes on Wednesday amid rising market uncertainties. COMEX gold has an vital resistance at $1,940 for resumption of a bullish development. We count on bullion costs to commerce within the present vary with a bearish bias for the day.

Trading Strategy:

Sell on the rise is advisable for the day at round Rs 50,550 with:

MCX Gold December

  • SUPPORT at Rs 50,100 per 10 gram
  • RESISTANCE at Rs 50,780 per 10 gram

MCX Silver December

  • SUPPORT at Rs 59,000 per kg
  • RESISTANCE at Rs 62,500 per kg

Outlook: Crude Oil

Crude oil costs resumed an uptrend with benchmark WTI crude oil rallying by 2 per cent to $41 on Wednesday. Crude oil costs gained attributable to a weaker greenback and a fall in weekly inventories. API report confirmed that US crude oil inventories fell by 5.42 million barrels final week. Crude oil costs might keep the higher buying and selling vary amid expectations of a bullish weekly stock knowledge within the night session. However, demand progress is a continuing concern for oil worth restoration as surge in COVID-19 infections in Europe and the US has dampened hopes of a restoration in gasoline demand.

Trading Strategy:

We advocate purchase on dips at round Rs 2,980 with:

MCX Crude Oil October

  • SUPPORT at Rs 2,940 per barrel
  • RESISTANCE at Rs 3,050 per barrel

Outlook: Base Metals

Base metals witnessed blended commerce on Wednesday with Lead and Nickel costs gaining essentially the most, whereas Zinc traded weak for the day. Copper costs saved buying and selling steadily on blended international cues as high miners have been in dialogue to keep away from strike at Chile. A strike and protests at Lundin’s Candelaria operations have severely disrupted manufacturing by round 5 per cent on the Chilean copper mine, in response to a union boss.

Trading Strategy:

We count on Copper costs to commerce sideways to down for the day with:

MCX Copper October

  • SUPPORT at Rs 521
  • RESISTANCE at Rs 528

MCX Zinc October

  • SUPPORT at Rs 190
  • RESISTANCE at Rs 195

MCX Nickel October costs might witness promoting for the day with a fall in Iron Ore costs

  • SUPPORT at Rs 1,110
  • RESISTANCE at Rs 1,140

(Tapan Patel is Senior Analyst (Commodities) at HDFC Securities. Views are his personal)

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