Tuesday, November 30, 2021
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Commodity strategies: Gold, silver, crude, base metals


Tapan Patel


Here is a look at how different commodities are behaving in today’s market.

Outlook: Bullion
Bullion prices traded firm on Wednesday with spot gold prices at COMEX near $1,761 per ounce while spot silver prices marginally up near $22.66 per ounce. Bullion prices held firm trading range supported by softer dollar and lower US bond yields. The dollar index was trading near 94.37, 0.16 per cent lower for the day. The precious metals traded firm ahead of US FOMC minutes and US inflation data scheduled today. Bullion prices may trade sideways to up for the day.

Trading Strategy:

Gold December resistance for the day lies at Rs 47,500 per 10 gram with support at Rs 46,900 per 10 gram. MCX Silver December support lies at Rs 60,800 per kg, resistance at Rs 62,800 per kg.

Outlook: Crude Oil
Crude oil prices traded weak on Wednesday with benchmark NYMEX WTI crude oil prices down by 0.17 per cent to $80.53 per barrel. Crude oil traded lower as inflation worries has raised demand concerns for fuel. We expect crude oil prices to trade sideways to up for the day.

Trading Strategy: MCX Crude Oil October support lies at Rs 5,980 per barrel with resistance at Rs 6,170 per barrel.

Outlook: Base Metals
Base metals prices traded higher on Wednesday. Most of the metals gained on China custom data despite weak global cues. China’s copper imports rose in September from the previous month, customs data showed on Wednesday. Exports of unwrought aluminum and products, meanwhile, were at 491,985 tonnes in September, the highest monthly level since March 2020. Aluminum prices rose to 13-year high on higher demand and rise in Chinese exports. Base metals may trade sideways to up for the day.

Trading Strategy: MCX Copper October support lies at Rs 732 and resistance at Rs 743. MCX Zinc October support lies at Rs 268, resistance at Rs 275. MCX Aluminium September support lies at Rs 240 with resistance at Rs 248.

Ravindra Rao


MCX Gold futures moved higher on Tuesday but settled below the 200-DEMA at Rs 47,380. Price is hovering above the trend line resistance and the psychological zone of Rs 47,000, which has strengthened bullish hopes in the bullion. The bullish crossover of 8- and 20-day EMA has also supported the recovery. On the lower end, immediate support exists around Rs 46,900 (8-DEMA), followed by Rs 46,720 (20-DEMA). The medium-term momentum has turned positive as the MACD index has generated a crossover buy signal. The MACD histogram is in the positive territory within an upward sloping trajectory which supports the higher price trend. To conclude, price is expected to consolidate in the wide range of Rs 46,900-47,380 with a sideways to higher bias. Only a close above Rs 47,380 would bring renewed buying interest in the yellow metal and push it higher towards Rs 47,800.

Trading Strategy: Buy MCX Gold Dec at Rs 47,000. Target: Rs 47,400. Stop loss: Rs 46,850

MCX Silver prices remained in a sideways range after breaching the short term DEMAs of 20 and 8. Although the regression channel on the daily chart suggests a weaker bias, the price is hovering in between the mid and higher band of the channel suggesting a possible phase of recovery. The formation of a bullish candlestick pattern near the support line along with positive divergence in RSI could support bulls. Immediate resistance is at Rs 63,200 (50- DEMA). A close above Rs 63,200 might resume its recovery rally towards Rs 64,200. Support is at Rs 61,200 (20- DEMA), followed by Rs 60,000 (midline of the regression channel) below which the bears may target Rs 58,200 (recent bottom). From the above analysis, we expect the price to trade in the range of Rs 60,000-63,200 with a sideways to higher bias. Closing above Rs 63,200 may intensify the bullish momentum towards Rs 64,200.

Trading Range: Rs 60,000-63,200

(Ravindra Rao is CMT, EPAT, VP-Head Commodity Research, Kotak Securities Ltd. Views are his own)



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