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CAPITALSTARS – MCX COMMODITY MARKET NEWS & LEVELS – 5 NOV 2018

Commodities-Market-1

Gold dips as US dollar gains on solid jobs data.

Gold slipped on Friday as the U.S. dollar regained some ground on the back of strong American jobs data, putting the metal on track for its first weekly loss in five weeks. The U.S. Federal Reserve has raised interest rates three times this year and is widely expected to raise rates again in December. Gold is sensitive to higher U.S. interest rates, which increase the opportunity cost of holding non-yielding bullion, while boosting the dollar, in which it is priced. Gold jumped about 1.5 percent in the previous session as the dollar retreated sharply from a 16-month high. Share on major world markets rallied on hopes that the United States and China were starting to repair their damaged trade relations. Attention is now turning to the U.S. congressional elections on Nov. 6, which will determine whether the Republican or Democratic party controls Congress, with some predicting increased market volatility on the outcome. Meanwhile, physical gold demand in India, the second biggest consumer, remained lackluster this week, with dealers offering discounts for the metal ahead of a traditionally busy festival week for the first time in at least three years, as high prices kept consumers away.

In the physical market, cash flow issues prompted sellers to offload cargoes while spot premiums rose from previous declines.

A weaker US dollar index bolstered the SHFE 1901 contract to a high of 49,960 yuan/mt in the afternoon, after the contract struggled around 49,135 yuan/mt in the morning. It closed at 49,830 yuan/mt, with open interests down 3,264 lots. Some 157 million yuan of capital left all SHFE copper contracts, the greatest among base metals. Currently between the Bollinger middle and lower bands, the 1901 contract may see more shorts leaving the market tonight. It will test pressure above at the 50,000 yuan/mt level tonight.

In the domestic physical market, stainless steel mills held back from purchases given the recent declines in nickel prices.

The SHFE 1901 contract ended its six consecutive trading days of decline as it grew 1,710 yuan/mt from Thursday to close at 98,680 yuan/mt, buoyed by positive macroeconomic sentiment. Open interests shrank 57,000 lots, with shorts accounting for the majority. We expect the contract to test support at the five-day moving average and try to stand above 100,000 yuan/mt tonight as its MACD green line shortened. Investors may take more cues, from the US unemployment data for October, its durable goods orders, and factory orders data for September. Oil prices fell on Friday as surging output by the world’s three largest producers outweighed supply concerns. Oil prices fell about 1 percent on Friday and notched a weekly loss of over 6 percent, as investors worried about oversupply after the United States said it will temporarily spare eight jurisdictions from Iran-related sanctions. Both contracts have fallen more than 15 percent from the near four-year highs touched in early October on worries the looming Iran sanctions could drain supply from global markets. Pompeo did not name the jurisdictions, but said the European Union as a whole, which has 28 members, would not receive one. India, Iraq and South Korea were on the list of waivers, said a source familiar with the matter who spoke on condition of anonymity. Under U.S. law, such exceptions can only be granted for up to 180 days. Turkey has been told it will receive a waiver on U.S. sanctions against Iranian oil sales, Turkish Energy Minister Fatih Donmez said on Friday that it had no concerns over the re-imposition of sanctions.

Precious Metals

CS GOLD (DEC) OVERVIEW:
TREND : SIDEWAYS
RESIST 2: 32100
RESIST 1: 32000
SUP 1: 31700
SUP 2: 31600

CS SILVER (DEC) OVERVIEW:
TREND : BEARISH
RESIST 2: 39300
RESIST 1: 39000
SUP 1: 38500
SUP 2: 38300

Base Metals

CS COPPER (NOV) OVERVIEW:
TREND : BEARISH
RESIST 2: 458.00
RESIST 1: 453.00
SUP 1: 448.00
SUP 2: 442.00

CS NICKEL (NOV) OVERVIEW:
TREND : BEARISH
RESIST 2: 878.00
RESIST 1: 873.00
SUP 1: 857.00
SUP 2: 850.00

CS ZINC (NOV) OVERVIEW:
TREND : BEARISH
RESIST 2: 192.00
RESIST 1: 190.00
SUP 1: 187.00
SUP 2: 194.00

CS LEAD (NOV) OVERVIEW:
TREND : BEARISH
RESIST 2: 148.00
RESIST 1: 146.00
SUP 1: 144.00
SUP 2: 142.00

CS ALUMINIUM (NOV) OVERVIEW:
TREND : BEARISH
RESIST 2: 148.00
RESIST 1: 146.00
SUP 1: 144.00
SUP 2: 142.00

Energies

CS CRUDE OIL (NOV) OVERVIEW:
TREND : BEARISH
RESIST 2: 4790
RESIST 1: 4740
SUP 1: 4565
SUP 2: 4520

CS NATURAL GAS (NOV) OVERVIEW:
TREND : BEARISH
RESIST 2: 248.00
RESIST 1: 244.00
SUP 1: 238.00
SUP 2: 235.00

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