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Commodity outlook: Energy, metal counters trade with gains; expect choppy movement

Gold can test Rs 38,050 while facing resistance near Rs 38,300

ETMarkets.com|
Oct 18, 2019, 01.30 PM IST
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cotton
Cotton futures (Oct) are expected to trade with a negative bias and may even break the near support of Rs 19,420.
Barring bullion counters, all near term metal and energy commodity futures were trading with gains on Friday as the UK clinched a Brexit deal from European Union which could ensure its smooth exit from the trading block. However, the overhang of slowing Chinese economy capped gains. China reported a lower-than-expected 6 per cent GDP growth for the third quarter.

Kotak Securities expects the metal pack to trade mixed. However, bias may remain negative amid fragile sentiments and demand worries.

“Crude may continue to witness choppy trade unless there is more clarity on US-China trade deal, Brexit and middle-east issues however the general bias remains weak owing to demand concerns and rising US supply,” Kotak added.

Here are detailed expectations from SMC Global for the day:

Bullion: Bullion counter may trade sideways. Gold can test Rs 38,050 while facing resistance near Rs 38,300 and silver can test Rs 45,200 while facing resistance near Rs 45,600.

Base metals
: Base metals may trade with a positive bias. Copper may test Rs 440 while taking support near Rs 435. Zinc can trade in range as it can face resistance near Rs 188 while taking support near Rs 182. Lead may trade sideways to up as it can test Rs 157 while taking support near Rs 154. Nickel may also trade with a negative bias as it can test Rs 1,160 while taking resistance near Rs 1,200. Aluminum may test Rs 135 while taking support near Rs 132.

Energy: Crude oil may witness a bounce back at lower levels as crude oil may test Rs 3,870 while taking support near Rs 3,780. Natural gas, on the other hand, can witness lower level buying as it can move towards Rs 167 while taking support near Rs 162.

Spices:
Turmeric futures (Nov) are likely to plunge further to test Rs 5,700, if it breaks Rs 5,760. Jeera futures (Nov) are expected to face resistance near Rs 16,435 levels and trade with a negative bias. Dhaniya futures (Nov) are expected to face resistance near Rs 6,180 and the upside may remain capped.

Oilseeds:
Soybean futures (Nov) are likely to hold on to the support near Rs 3,730, while the upside may get extended till Rs 3,785. Mustard futures (Nov) are expected to trade sideways in the range of Rs 4,115-4,160, while CPO futures (Nov) are likely to trade higher towards Rs 562-565, if surpasses the resistance near Rs 560.

Other commodities:
Cotton futures (Oct) are expected to trade with a negative bias and may even break the near support of Rs 19,420. Chana futures (Nov) may face resistance near Rs 4,515 and witness profit booking from higher levels. Mentha oil futures (Oct) may take support near Rs 1,195 and trade with an upside bias towards Rs 1,215-1,222 due a fall in warehouse stocks.
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