Last week MCX Gold prices closed on a positive note up by 0.40% and closed at 56780 levels. In international it closed on a flat to positive note up by 0.02% and closed at $1865.35 per ounce.
But on the other side MCX silver price corrected by 1.32% and closed at 66735 levels. In the international market it was corrected by 1.52% and closed at $21.99 levels.
Last week we noticed the sharp recovery in US bond yield and US dollar index from the oversold zone. Bullion prices are not able to sustain on higher levels as rising short term bond yield and expectation of more interest rate hikes from the federal reserve work as a barrier for the yellow metals. But Fear of uncertainty and higher crude oil prices may curb the sharp correction in bullions and may provide support further.
Technically the trend of yellow metals are still positive and we are recommending a buy on dips strategy for the next week. Gold may find support at 56350 levels ($1835) and then 55900 ($1820) levels while resistance at 57100 levels ($1890) and then 57500 ($1920) levels.
Silver may find support at 65500 levels ($21.50) and then 64000 ($20.80) while resistance at 68000 levels ($22.50) and then 69500 levels ($23.20).
Oil prices rose more than 2% on the last trading day of the week and also posted 8% gains in the last week as Russia announced plans to reduce oil production by 5,00,000 barrel per day from the next month after the west imposed price caps on the country’s crude and fuel.
On MCX Crude oil prices increased by 7.38% and closed at 6563 levels while Brent crude oil prices increased by 8.10% and closed at $86.44 levels last week.
Technically the trend of crude oil is looking positive, and we are recommending to buy in crude oil prices. It has a strong support at 6350 levels ($84) and then 6100 levels ($81) while resistance at 6700 levels ($88) and then 7000 levels ($70).
Last week all major base metals were corrected sharply. Copper corrected by 0.76% and closed at 765.70 levels, Zinc prices corrected by 4.92% and closed at 270.60 levels, Aluminium prices corrected by 3.60% and closed at 215.30 levels, while lead was closed 0.33% higher at 184.40 levels.
The fear of global recession was the major reason for the correction in base metals prices. However the china demand may curb the sharp correction in the base metals.
For the next week copper has a strong support at 755 levels and then 745 levels while resistance at 775 levels and then 785 levels. For the next week we are expecting a sideways trend in the base metals so traders can trade between support and resistance levels, while strength in crude oil prices may support the metal prices.
Rupee depreciated by 0.84% and closed at 82.54 levels due to strength in the dollar.
The Reserve Bank of India (RBI) data released on Friday showed that India’s foreign exchange reserves declined by USD 1.494 billion, reaching a total of USD 575.267 billion as of 3 February. This marks an end to the three-week upward trend, as the reserves had increased by USD 3.03 billion in the previous reporting period, totalling USD 576.76 billion.
The trend of the dollar is expected to trade higher due to short covering as it is in recovery mode from the oversold zone. Rupee has a strong support at 82.20 levels and then 81.80 levels while resistance at 83.00 and then 83.40 levels. We are recommending buy in usdinr on the support levels.
NCDEX Cocudakl March
NCDEX Cocudakl March contract corrected by 0.44% and closed at 2709 levels due to the lower demand. We have also seen that stockists are also selling their old cocudakl. The arrival of a new crop of RMSeed may also put pressure on cocudakl.
For the next week we are recommending that traders can go for sell in cocudkal. It has a strong support at 2550 levels and then 2300 levels while resistance at 2800 levels and then 2950 levels.