Commodity weekly technical report by trifid research
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Transcript of Commodity weekly technical report by trifid research
28 OCT – 01 NOV 2013
W E E K L Y
R
E
P
O
R
T
Blow by Blow
On
Bullions,
Base metals,
Energy…
WWW.TRIFIDRESEARCH.COM
MAJOR EVENTS
Silver continues to be a worst performer among precious metals in 2013 after having
fallen sharply by 31% in Q2 but partly offset by 11% gains in Q3, 2013. Silver has
benefitted from the rise in gold prices and mixed trend in industrial.
Silver prices which fell 29% till Q3 will continue to face challenges but will be
increasingly determined by movement of gold prices. Restrictions on gold imports will
continue to positively impact gold. Silver has a correlation of 0.98 with gold and 0.94
with base metals. The major challenges for silver comes from increased production in
recent years and rising scrap supply which will keep the overall market oversupplied.
Some suggest that if silver prices remain below $20, it is highly likely that more
primary silver miners will be forced to put their high cost mines on care and
maintenance until prices recover. Bearishness in gold prices could also hurt silver
although sharp correction in silver prices could boost its demand. As per early market
estimates, global fabrication demand for silver will remain stable as global economy
improves slowly. Mine production is likely to grow further as price remains well above
historical levels and as higher production of base metals may increase by-product
output.
It's bear party in Oil complex but doubtful analysts are quite neutral on this volatile
and complex commodity that is much in demand worldwide.
One major reason for the bearish trend that pushed WTI crude Oil futures December
contract to $96.16 low was the surge in oil inventories in USA. The Energy
Information Administration (EIA) had reported crude stock piles rose 5.2 mnb barrels
for the week ended October 18. MCX crude oil futures for November delivery was
seen trading down by 0.10% at Rs. 6020 per barrel as of 11:20 PM IST on Thursday.
INR also appreciated by 0.35% against USD this morning which also affect crude
prices in negative way.
Meanwhile WTI Crude Oil has advanced to 97.47 after hitting a low of $96.16 as the
latest HSBC China PMI data showed manufacturing index rose to 50.9 in October.
China is the second biggest oil consumer. China will account for about 11 percent of
global oil demand this year, compared with 21 percent for the U.S., according to
forecasts from the International Energy Agency.
Bear dance on
plentiful Crude Oil
stocks, China
growth spoils the
play.
World refined
Copper
production to
rise 3.9% in 2013.
World refined copper production in 2013 is expected to increase by 3.9% compared to
2012 as constrained production from maintenance and temporary operational
shutdowns in some regions is overshadowed by expanded output in other regions,
according to International Copper Study Group (ICSG).
In 2014, refined copper production is expected to grow by around 5.5% to 22.1 Mt
with the restoration of production at existing plants and new and expanded capacity
at electrolytic plants in China, and to a lesser extent SX-EW plants in Africa. Primary
refined copper production is expected to grow by about 7% and secondary production
by 2%.
ICSG expects world apparent refined demand in 2013 to remain unchanged from that
in 2012 (20.5 Mt). Although real demand for copper in China is expected to increase by
about 6% in 2013, apparent demand in China (that is uncorrected for unreported stock
changes) is expected to decrease in 2013 as a result of much lower refined imports.
Usage in the rest of the world is expected to increase by around 1%. With better
prospects for the world economy in 2014, world usage is expected to grow by around
4.5% in 2014 with world-ex-China expected to grow by 2.5%.
Gold to be a key
influence on
Silver market
ahead.
E C O N O M I C C A L E N D E R
DATE & TIME DESCRIPTION FORECAST PREVIOUS
Oct 28, 6:45pm Capacity Utilization Rate 78.1% 77.8%
6:45pm Industrial Production m/m 0.5% 0.4%
7:30pm Pending Home Sales m/m 0.5% -1.6%
Oct 29, 6:00pm Core Retail Sales m/m 0.4% 0.1%
6:00pm PPI m/m 0.2% 0.3%
6:00pm Retail Sales m/m 0.3% 0.2%
6:00pm Core PPI m/m 0.1% 0.0%
6:30pm S&P/CS Composite-20 HPI y/y 12.4% 12.4%
7:30pm CB Consumer Confidence 76.0 79.7
7:30pm Business Inventories m/m 0.3% 0.4%
Oct 30, 5:45pm ADP Non-Farm Employment Change 151K 166K
6:00pm Core CPI m/m 0.2% 0.1%
6:00pm CPI m/m 0.2% 0.1%
8:00pm Crude Oil Inventories 5.2M
11:30pm FOMC Statement
11:30pm Federal Funds Rate <0.25% <0.25%
Oct 31, 5:00pm Challenger Job Cuts y/y 19.1%
6:00pm Unemployment Claims 344K 350K
6:30pm Treasury Sec Lew Speaks
7:15pm Chicago PMI 55.1 55.7
8:00pm Natural Gas Storage 87B
Nov 01, 6:30pm Final Manufacturing PMI 51.1 51.1
6:40pm FOMC Member Bullard Speaks
7:30pm ISM Manufacturing PMI 55.3 56.2
7:30pm ISM Manufacturing Prices 55.1 56.5
All Day Total Vehicle Sales 15.5M 15.3M
S1 S2 S3 R1 R2 R3
29950 29080 28025 31160 31967 32840
S1 S2 S3 R1 R2 R3
48250 46700 44925 50350 52350 54700
T E C H N I C A L V I E W
MCX GOLD on its daily charts showed
bullish movement and also gave
breakout of channel pattern and able
to hold above 50% retracement and
found strong resistance of 30850. Now,
if this bull trend continues then 30850-
31160 will act as immediate resistance
above which 32000 act as strong
resistance. If some correction occurs
then 29950 will act as major support
level.
S T R A T E G Y Better strategy in MCX GOLD is to buy
above 30850 for the target of 31950
with stop loss of 29890.
PIVOT TABLE
G O L D
PIVOT TABLE
S I L V E R
T E C H N I C A L V I E W
MCX SILVER last week showed bullish
movement and able to maintain above
50% retracement and also gave
breakout of downward channel pattern.
Now, if it sustains above 50350 then
next resistance will seen around 38.2%
retracement i.e. 51800.If it breaches the
level of 49150 then upper band of
channel pattern may act as support for
it i.e. around the level of 47500.
S T R A T E G Y Better strategy in MCX SILVER at this
point of time is to buy above 50500 for
target of 52300, with stop loss of 48200.
C R U D E O I L
C O P P E R
S1 S2 S3 R1 R2 R3
5935 5750 5570 6090 6235 6370
S1 S2 S3 R1 R2 R3
440 432 420 453 460 471
T E C H N I C A L V I E W
MCX Copper on daily charts has been
moving in downward channel pattern
and reversed from the upper band last
week. In support of COMEX Copper
weakness, it breached the 61.8%
retracement level of 447 and closed
around it. Strong support is seen near
trend line i.e. around 440 below which
bear trend will continue. Closing
above 460 and holding above it will
indicate breakout of downward
channel pattern.
S T R A T E G Y Better strategy in MCX CRUDEOIL is to buy
above 6120 for the target of 6300 with stop
loss of 5935.
PIVOT TABLE
T E C H N I C A L V I E W
Crude oil had been running through
bloodbath since last consecutive eight
weeks surpassing all its deeper support
level. It has been hovering around
upper band of channel pattern, now if
it holds above 6100 then break out of
channel pattern will be expected. On
other hand if this bearishness
continues then 5935 will act as major
support for it.
S T R A T E G Y Better strategy in MCX COPPER is to sell
below 440, with stop loss of 455 for the
target of 430.
PIVOT TABLE