CPI and WPI Numbers and Commodity Tips

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CPI and WPI Numbers and Commodity Tips
Gold commodity has been rising continuously since
beginning of the year 2014 from 1200 to 1355 so
at any point in time prices may take a smart
downward correction. Nonetheless, we need to be
very cautious is developing a view for the
next week. Looking at the economic data,
we have very conventional releases from the US
and euro-zone and expecting them to be remain
mostly in line with the expectation. In this
regard price action could be lower. Coming to
trade front, at the COMEX front though prices are
trading in a confined range but the volumes have
been much higher in last three week in
comparisons to previous period. This indicates
that there could be a huge price movement in the
next week. As stated above we are little
cynical about t he views so adding a
little technical study to our views we
believe if gold fails to above 1360 then
prices may drift down to 1320 and then
1300. Likewise, at the MCX platform prices have
fallen a tad but the both volumes and open
interests have increased substantially indicating
that the commodity may decline a tad in the early
part of next week. Therefore, we suggest a sell
view on gold commodity while preferring to be
cautious on the trade. Gold April MCX futures
prices initially made a weekly high of 30660 and
later started declining. In the weekly chart
prices are hovering in the trend channel and
expected to continue the same trend. Strong
resistance is seen at 30520 levels (trend
channel), which is expected to limit the
upside move. Immediate support is seen at
29881(previous week low). Break below 29881
could lead the drop towards 29580 levels. For
short term traders we suggest selling. Gold
Weekly Support on Downside at 29800-29300 Gold
Weekly Resistance on Upside at 30500-31000 Trend
Sideways Silver overall we feel, broader part of
the view for the commodity continues to be on the
weaker side of the trade. While other cues with
regards to the institutional investment side have
been pretty stable, we feel the commodity would
continue to take negative cues with regards
movement in base metals. We have seen a huge drop
into the commodity mainly on Friday evening (IST)
after the US non-farm payrolls data which
showed a better than expected increase in
monthly payrolls. This pressed both gold
and silver lower, though silver owing to its
higher beta recorded a very high fall and the
ratio also inched higher to 64 marks. We feel
next week there is further chance for this ratio
to inch higher though post the sudden rise
this week, traders are advised to initiate
the spread on small declines Onto the
commodity also, we have a selling view and would
recommend traders to look for short positions in
the next week. Locally, we feel there are decent
set of cues particularly the CPI and WPI number
which are expected to continue show
improvement and could lead to some
appreciation extending into the Rupee, which
is another factor which is likely to add to the
weight into the commodity in Indian MCX
markets Silver May MCX futures prices continued
its downside journey in the last week. As Prices
are hovering below the weekly exponential
moving averages (8, 13 21), which is
signaling downside pressure to
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remain intact. We might see a higher correction
before resuming its downtrend. Key resistance
level to watch is at 46900 levels, which is
expected to hold the downside view. Downside
potential is seen until 45300 levels. Break below
45300 will confirm short term downtrend. Silver
Weekly Support on Downside at 45500-44500 Silver
Weekly Resistance on Upside at 47100-48000 Trend
Down Commodity Tips SILVER MCX MAY NEAR
46800-46900 SL 48000 TGT 45800-45200 COPPER MCX
APR SELL NEAR 430-432 SL 441 TGT 415-410 CRUDE
OIL MCX MAR NEAR 6400-6450 SL 6550 TGT 6100-6050