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Friday, March 31, 2023

MCX Copper likely to trade in a range between 411.6-426

Mentha Oil market under long liquidation; Resistance seen at 1537.5

Aluminium market under fresh buying; Support seen at 138.3

Nickel market under short covering; Support seen at 918

MCX Zinc likely to trade between 169.1-187.5 levels

Natural Gas market under fresh selling; Support seen at 186.3

Technically now Copper is getting support at 416.2 and below same could see a test of 411.6 levels and resistance is now likely to be seen at 423.4, a move above could see prices testing 426.

Copper on MCX settled up 0.67% at 420.65 gained from the day’s low as LME copper climbed to around $6,200/mt and closed at $6,180/mt with support from rebounding zinc. However, it failed to reverse its weak trend overnight. It may receive some support if spot discounts keep narrowing.

Prices last week slumped to the lowest in a year at $6,081 a tonne on concerns that an escalation in trade tariffs could dent demand. Prices have shed 14 percent this year.  China’s second-quarter growth slowed as expected, with the focus expected to shift to China’s response to the latest U.S. tariffs plan.

China’s economic growth slowed in the second quarter as the government’s efforts to tackle debt risks crimp activity and an intensifying trade war with the United States threatens to knock exports.

At 6.7 percent, growth came in line with expectations, said analyst Lachlan Shaw of UBS in Melbourne, which suggests markets will now watch China for any formal response to the U.S.’s tariff plans. Last night the US dollar index inched down from a three-week high but still stood above the 95 level and closed at 95.09. Base metals mostly consolidated at low levels.

LME copper and lead touched their one-year lows, and lead closed slightly lower. However, zinc jumped nearly 4.5%, the biggest one-day gain over a year, due to declining inventory and tight supply. Other base metals edged up. >From data point the US housing starts tumbled 12.3% to a seasonally adjusted annual rate of 1.17 million units in June, the lowest level since September 2017. 

 Trading Ideas:
–Copper trading range for the day is 411.6-426.
–Copper prices gained on short covering but concerns of slowing growth in top metals consumer China limited gains.
–China’s economy expanded at a slower pace in the second quarter as Beijing’s efforts to contain debt hurt activity, while June factory output growth weakened to a two-year low.
–The discount of cash copper to the three-month contract has also grown from around zero at the start of July to $36, signalling greater availability of metal.

Courtesy: Kedia Commodities

Source: Commodityonline.com

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