Daily Metal and Energy Outlook 26th April
Bullions: Bullion counter may trade on positive note as gold rose on Friday, on track for its first weekly gain in five weeks as investors focused on signs of economic weakness after dismal data from Germany and Asia, although a strong dollar ahead of U.S. GDP data kept a lid on gains. The dollar was also helped by data showing new orders for U.S.-made capital goods increased by the most in eight months in March, hitting their highest level on record. Gold may test 32000 while taking support near 31750 while Silver can test 37800 while taking support near 37300. Japan’s industrial output fell 0.9 percent in March from the previous month, down for the first time in two months, government data showed on Friday. The U.S. Federal Reserve is done raising interest rates until at least the end of next year, while about a third of economists polled by Reuters who had a view that far out predicted at least one rate cut by then.
Base metals: Base metals prices may trade with sideways to positive bias. Copper may test 452 while taking support near 446 in MCX. London copper prices on Friday inched away from a one-month low touched in the previous session, buoyed as the U.S. dollar eased from a two-year high. Sentiment was also supported by news that U.S. President Donald Trump would soon host Chinese leader Xi Jinping at the White House, setting the stage for a possible agreement on trade between the world’s two largest economies. Freeport-McMoRan Inc’s copper output fell 18 percent to around 340,000 tonnes in the first quarter, while Anglo American’s production rose by 4 percent to 161,100 tonnes. Australian miner Aurelia Metals Ltd said it was in talks about a possible acquisition of Glencore’s CSA copper mine in the state of New South Wales. Zinc can test 234 while taking support near 230. Lead can move in range of 133-136. Nickel may test it can test 875 while taking support near 850. Aluminum prices may recover towards 153 while taking support near 149.
Energy: Crude oil may witness some profit booking at higher levels as oil prices dipped on Friday on expectations that producer club OPEC will soon raise output to make up for a decline in exports from Iran following a tightening of sanctions by the United States against Tehran. But prices were already gaining before the Russian disruption, driven up by supply cuts led by the Middle East dominated Organization of the Petroleum Exporting Countries (OPEC) and U.S. sanctions against Venezuela and Iran. Crude futures are up around 40 percent so far this year. Crude oil may dip towards 4500 while facing resistance near 4610 in MCX. Washington said on Monday it would end all exemptions for sanctions against Iran, demanding countries halt oil imports from Tehran from May or face punitive action from Washington. To make up for the shortfall from Iran, the United States is pressuring OPEC’s de-facto leader Saudi Arabia to end its voluntary supply restraint. Despite U.S. efforts to drive Iranian oil exports down to zero, many analysts expect some oil to still seep out of the country. Natural gas may trade in range of 177- 182 in MCX. U.S. natural gas futures rose following the release of a storage report that was mostly in line with expectations, but warmer-than-normal weather, low heating demand and near-record production kept a lid on prices.
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