Commodity Research Report Ways2Capital 16 Oct 2018

 

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BULLION

Gold prices rose early on Monday as Asian stocks eased due to concerns about a potential decline in China economic growth amid an ongoing trade war and signs of tighter monetary policy by the U.S. Federal Reserve. Spot gold was up 0.3 percent at $1,220.66 an ounce at the time of writing. Gold rose 1.3 percent last week in its biggest weekly percentage gain in seven weeks. U.S. gold futures were up 0.2 percent at $1,224.1 an ounce. China central bank governor Yi Gang said on Sunday he still sees plenty of room for adjustment in interest rates and the reserve requirement ratio (RRR) as downside risks from trade tensions with the United States remain significant.

ENERGY

Crude markets were also supported in the wake of data that showed South Korea did not import any oil from Iran in September for the first time in six years before U.S. sanctions against the Middle East country take effect in November. Brent crude had risen 98 cents or 1.22 percent to 81.41 a barrel at the time of writing, on track for its biggest daily gain since Oct. 9. U.S.

The Energy Information Administration released its report on US natural gas inventories showing a build of 90 billion cubic feet in the week ending October 5, adding to the 98 billion in the previous reading while analysts expected 87 billion.

Base Metals

Aluminium prices traded on marginal gains after rebounding on Friday, breaking a six-session losing streak as speculators and consumers regarded the lower prices as good value against a background of recovering share markets. The metal touched a two week low on Thursday amid a broad sell off sparked by a global rout in equities. But global shares were having their best day in nearly a month on Friday as European and Asian markets recovered.

SPICES

Bullish trend persisted for Jeer as reports from Gujarat indicate a below normal rain to adversely affect the sowing starting later this month. This could have some long term support impact on the commodity prices. As sowing seasons starts in a month's time from now rains in Gujarat and Rajasthan would be critical for the moisture content in the soil for improved sowing.

Turmeric traded with slight weakness even as prices found immediate support at these levels. Falling stocks amidst rise in Festive season domestic demand and export demand are likely to support prices in coming weeks with new crop arrivals only in Dec end all these factors could provide support to the prices that have fallen a lot.


OILSEEDS

Mentha oil traded in a range even as moderate firm sentiments prevailed in mandis with profit booking limiting the upside movement. Rising export demand amidst adverse reports on the production front are likely to support prices in coming weeks. Winter season demand is expected to pick up over the next few months on the domestic as well as the export front.

Lack of fresh bullish cues from global markets kept sentiments eased. Ahead of Indian/US harvest season of the soy bean crop not much of upside is expected in edible oils especially soya oil. However there is frequent buying interest in spot market whenever moderate price decline occurs.

GUAR COMPLEX

Trend remained very volatile for Guar but some support was noted at the lower levels with expected recovery likely. Lower rains earlier this year during Monsoon had adversely affected the sowing. With stocks reportedly on the lower side and falling amidst no new arrivals for now sentiments are looking positive for the counter. As the bearish impact of rains gradually get over fall in prices may be limited from the monsoon factor.


OTHERS

RM seed futures market failed to move up yesterday tracking weakness in soy bean. Failure of palm oil to sustain above resistance levels also eased the upward trend. In coming days report of Government's announcement to hike Mustard MSP by Rs 200/qtl may provide support. But spot demand should also remain strong for the up trend to sustain during this week.

It was another bearish session for soy bean derivative market. As long as harvest pressure is not building there might be temporary pull backs but the upward momentum might ease soon as harvests activity in MP and Maharashtra improve in next few weeks.


RMSEED
Last week RMSEED started a week on negative note but found enough support near the level of 4100 and getting bounce back from lower level indicating strong support zone near the level of 4100. On its daily chart RMSEED forms spinning top bullish formation indicating positive trend in it. For this week, if it breaks the level of 4200 on the upper side then it can test the level of 4330 during the week. One can make buy position in it by maintaining a SL at 4149

CHANA
From last couple of trading weeks Chana is trading in range between the level of 4250 – 4100 and forming double top formation on its four chart indicating bearish trend in it. On its four hourly chart RSI is trading in negative territory and printing below the level of 50 indicating short term negative movement in it. Last week Chana made a low of 4141 and closed at 4172 with overall marginal gain of 0.43% on weekly basis. For this week, if it breaks the level of 4100 on the lower side then it can test the level of 3970 during the week. One can make sell position in it by maintaining a SL at 4151.

SPICES

Bullish trend persisted for Jeer as reports from Gujarat indicate a below normal rain to adversely affect the sowing starting later this month. This could have some long term support impact on the commodity prices.

Turmeric traded with slight weakness even as prices found immediate support at these levels. Falling stocks amidst rise in Festive season domestic demand and export demand are likely to support prices in coming weeks with new crop arrivals only in Decendall these factors could provide support to the prices that have fallen a lot.

Mentha oil traded in a range even as moderate firm sentiments prevailed in mandis with profit booking limiting the upside movement. Rising export demand amidst adverse reports on the production front are likely to support prices in coming weeks.

Lack of fresh bullish cues from global markets kept sentiments eased. Ahead of Indian/US harvest season of the soybean crop not much of upside is expected in edible oils especially soya oil. However there is frequent buying interest in spot market whenever moderate price decline occurs.


( ZINC )
Last week Zinc made a high of 204.15 and closed at 197.50 with overall marginal loss of 0.13% on weekly basis. And we can see from last couple trading weeks market is trading in sideways trading channel with negative RSI and on its four hourly chart Zinc is forming Head & Shoulder formation on higher level indicating negative trend in it. For this week, if it breaks the level of 198.50 on the lower side then it can test the level of 191.50 during the week. One can make sell position in it by maintaining a SL at 199.60.

ATURALGAS
Last week Natural Gas started a week on positive note but found enough resistance near the level of 250 and getting selling pressure from higher level indicating strong resistance zone near the level of 250. On its 4 hourly chart Natural Gas is forming Head & Shoulder formation indicating negative trend in it. For this week, if it breaks the level of 238 on the lower side then it can test the level of 228 during the week. One can make sell position in it by maintaining a SL at 242.50

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