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By Tapan Patel
Commodity prices continued to trade mixed on Monday. Bullion prices extended strength at the start of the week after witnessing recovery in last trading session. Crude oil futures continued to witness downside on weak fundamentals while base metals kept in a steady trading range supported by positive Chinese data. The dollar index was trading up after Europe went for fresh lockdown.
Here is a look at how different commodities are behaving in today’s market.
Outlook: Bullion
Bullion prices were trading firm on Monday morning with COMEX spot gold prices near $1,880 per ounce while spot silver prices at COMEX traded near $23.85 extending gains despite a stronger dollar. Bullion prices were up ahead of the US Presidential election and lockdown in Europe. Bullion prices are expected to trade in current range with sideways to upmove for the day on weak global cues.
Trading Strategy: MCX Gold
- Resistance for the day lies at Rs 51,000 per 10 grams
- Support at Rs 50,500 per 10 grams
MCX Silver
- Support lies at Rs 60,500 per kg
- Resistance at Rs 62,500 per kg
Outlook: Crude Oil
Crude oil prices extended decline on Monday with benchmark WTI crude oil prices down by nearly 4% at $34.41 per barrel. The weaker demand concerns over surge in virus cases with lockdown measures in Europe and oversupply scenario has pressured crude oil prices to trade weak. The lockdowns fear in the US over record cases has also kept prices lower. We expect crude oil prices to trade down for the day on broad weak fundamentals.
- Trading Strategy: Sell on rise
- Support at Rs 2,490 per barrel
- Resistance at Rs 2,630 per barrel
Outlook: Base Metals
Base metals prices were mixed with most of the metals trading in a range on stronger dollar and demand worries after lockdown in Europe. Base metals held some ground after the China Caixin Manufacturing PMI came at 53.6 against a forecast of 52.9. Copper prices may trade under pressure following weak global equity indices and demand growth concerns.
Trading Strategy: MCX Copper
- Support lies at Rs 521
- Resistance at Rs 529
MCX Nickel
- Support lies at Rs 1,130
- Resistance at Rs 1,160
The author is Senior Analyst (Commodities), HDFC securities