Zinc market under fresh selling; Support seen at 174.6
MCX Copper may trade in a range between 416.8-428.4
Natural Gas market under fresh selling; Support seen at 190.5
Crude Oil market under long liquidation; Support seen at 4714
Silver market under short covering; Support seen at 39164
Technically market is getting support at 419.4 and below same could see a test of 416.8 levels and resistance is now likely to be seen at 425.2, a move above could see prices testing 428.4.
Copper on MCX settled up 0.4% at 421.85 shrugged off an early dip to trade higher on Thursday as base metals staged a fragile recovery from the recent trade war-driven sell-off. Heavy losses in the previous session had pushed LME copper to its weakest in an almost a year as trade tensions between the US and China undermined confidence in demand for metals.
LME copper touched a high of $6,235/mt after hovering at the daily moving average. It gained $80/mt from Wednesday to close at $6,215/mt, with open interests up 7,000 lots to 323,000 lots. The SHFE 1809 contract also strengthened 220 yuan/mt to close at 48,810 yuan/mt.
While copper ore supply is expected to be sufficient in the second half of the year given high output at Chile’s Escondida in May, wage negotiation at the copper mine will be the development to watch. Copper prices will see limited downward room if macroeconomic developments do not exacerbate further.
Last night the US dollar index continued to gain on steadily-rising US inflation data and trade war saga. It closed at 94.8, with a slower growth rate from Wednesday.
The US CPI in June rose 0.1% from May, lower from the expected and May’s 0.2% increase. However, the underlying trend continued to indicate a steady build-up of inflation pressures that could keep the Fed on a path of gradual interest rate increases. Now key factors to watch today include China’s trade balance as well as import and export data in June, the US import price index last month and its July consumer confidence surveyed by the University of Michigan.
Trading Ideas:
–Copper trading range for the day is 416.8-428.4.
–Copper recovered on short covering after prices dropped as trade tensions between the United States and China undermined confidence in demand for metals.
–China accused the United States of bullying and warned it would hit back after the Trump administration raised the stakes in their trade dispute.
–The domestic price spread between scrap and refined copper narrowed to 100 yuan/mt, indicating a weaker substitution of scrap for the refined metal.
Courtesy: Kedia Commodities
Source: Commodityonline.com
