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Silver prices today: Commodity strategies: gold, silver, crude, base metals

By on May 25, 2021 0
By Tapan Patel

Commodity prices traded stably on Tuesday, after mixed trading in the previous session. On Monday, bullion prices remained in a stable trading range as base metals rallied in the evening trading session. Crude oil prices have risen due to a possible hitch in Iranian nuclear negotiations. The dollar index fell below the 90 mark, losing 0.19% for the day. Here is an overview of the behavior of different commodities in the current market.

Outlook: ingots

Bullion prices traded stably on Tuesday, with COMEX spot gold prices trading near $ 1,879 per ounce while COMEX silver spot prices traded slightly at 27. $ 63 an ounce in morning trading. Precious metals held in a firm trading range as gold was near its four-month highs, supported as a hedge against inflation by investors. Comments from US Fed officials were quite a chilling factor for prices after reiterating that the rise in inflation was transient. The surge in Covid business in other parts of the world has also supported bullion prices to trade steadily with the weak dollar. We expect bullion prices to trade sideways higher for the day.

Trading strategy:

The MCX Gold resistance for June for the day stands at Rs. 48,900 for 10 grams with support at Rs. 48,200 for 10 grams.

MCX Silver July support stands at Rs. 70,200 per KG, resistance at Rs. 72,800 per KG.


Outlook: crude oil

Crude oil prices traded higher against benchmark NYMEX WTI Crude oil prices were trading 0.21 percent up nearly $ 66.19 per barrel in morning trading . Crude oil prices gained on reports of some hitch in nuclear negotiations, leading traders and investors to increase their purchases from lower levels. Indirect negotiations between the United States and Iran are expected to resume this week in Vienna. The weak dollar and widespread commodity purchases also supported oil prices with the prospect of higher demand. We expect crude oil prices to trade sideways higher for the day.


Trading strategy:


The June support for MCX crude oil stands at Rs. 4,750 per barrel with resistance at Rs. 4,890 per barrel.


Outlook: base metals


Base metal prices traded positive on Tuesday as most metals reduced some of the previous losses. Base metals have seen some corrections from recent highs amid fears of higher inflation and fear of China’s policy actions. Copper prices benefited the most from the outlook for higher demand and wage negotiations in Chile. The Chinese state planner announced that he would tighten price controls on key commodities in his 14th five-year plan from 2021 to 2025, planning to deal with abnormal price fluctuations of items such as iron ore , copper and corn. Base metals are expected to trade sideways higher for the day.


Trading strategy:


MCX Copper June support stands at Rs. 751 and resistance at Rs. 760.

MCX Zinc June support stands at Rs. 229, resistance at Rs. 234.

MCX Nickel June support stands at Rs. 1230 with resistance at Rs. 1280.


(Tapan Patel is Senior Analyst (Commodities) at HDFC Securities)

By Ravindra Rao

MCX Gold The June futures contracts continued to move in the same rupee range. 48150-48900 since the last sessions. Key support for the day is at Rs. Zone 48200-48150 (8 day EMA) followed by Rs. 47680 (midline of the Bollinger Band). The upper bound of the Bollinger Band (48900) would act as a key resistance for the price. The price must move beyond Rs. 48900-48950 (61.8% Fibonacci retracement of the previous fall), to resume its uptrend towards Rs. 49250. In contrast, failure to hold above Rs. . 48150 would bring a correction phase and push the price towards Rs. 47900, followed by Rs. 47680. The strength index hovers around 63, which suggests a firmness of the trend. For the day, the price is expected to move around Rs. 48150-48900 with sideways bias. Only a sustained move above Rs. 48,950 would bring additional buying interest and push prices further towards Rs. 49,250.

Strategies:

The trading range for MCX Gold June futures contracts is between Rs. 48150-48900.

MCX Silver May futures have remained in a sideways trend after last week’s volatile session. Meanwhile, the price is trading below the 8-day EMA (71900), but the price has been supported by the 20-day EMA at Rs. 70600. Moreover, the price is still moving within of the uptrend channel, indicating the strength of the trend. Key resistance for July futures exists around Rs. 72,900, followed by Rs. 74,450 (previous high). Hence Rs. 70,600, holds a key near term level, only failure above would change the trend to neutral. On the momentum front, RSI hovers near 56, supporting lateral bias. Therefore, we would expect Silver to trade in a range of Rs. 70600-72900 with a sideways bias.

Strategy:

The trading range for MCX Silver May futures contracts is between Rs. 70600-72900.

(Ravindra Rao, CMT, EPAT is VP-Head Commodity Research at Kotak Securities)

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