Commodity Research Report Ways2Capital 7 May 2018

 

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BULLION
Earlier US data showed the unemployment rate fell to late 2000 lows at 3.9%, as analysts expected 4% while average hourly earnings slowed down to 0.1% from 0.2%. Bulls got interrupted while climbing the cliff and stepped back last week with negative returns. Momentum got stalled as prices broke 10 Day EMA which has been a near term support for the counter. However it seems a correction and may continue for a while but intermediate trend is positive and prices can bounce after retest of key support at Rs.30850. To resume the upside prices need to break above Rs.31430 mark that may lead them towards next supply zone at Rs.31700 level.

ENERGY
After a strong rally for two consecutive weeks counter paused for the week to take a breath. On weekly charts prices traded with marginal gains of 0.35% at Rs.4547 and formed a doji candlestick pattern. Pattern suggests that the bulls in current rally of up trend are now losing steam and fresh sellers are ready to step in. RSI on daily charts is trading close to overbought zone of 73 which indicates buying pressure in the counter which may push it to next support of Rs.4350.
Trend on daily charts natural gas remains positive as prices form higher high higher low pattern. After the recent decline prices are now trading close to daily swing support of Rs.184.

Base Metals
Along with zinc nickel also participated in the retreat after participating in the rally and lost around 5.8 per cent at MCX. Lead was away from the last week volatility created by sanctions concern on Rusal by the US For the week it gained more than 1 per cent at MCX. Copper also lost more than half of its previous week gain for the last week it lost around 2.25 per cent at MCX.

SPICES
Sideways trend was noted for Jeer last week as lack of strong trading activities prevented strong recovery despite falling arrivals. Good monsoon reports amidst pre-monsoon showers too kept upside limited. Moderate arrivals amidst lack of strong demand kept trend down for the counter.
Rates fired up for Turmeric as strong demand on export and domestic front supported prices with market sources mentioning present prices to be on the lower side. Normal Monsoon reports are likely to remain favourable for the crop sowing from June but that failed to limit the rising prices.

OILSEEDS

A moderately firm trend persisted for Mentha even as prices faced immediate Resistance near the 1380 mark. Reports of rising demand at these lower levels supported prices. However good crop sowing reports limited the up trend.
For the current session May soy bean is likely to trade with moderate upside and may find difficulty in sustaining above 3750-3775 levels. On the other hand strong support will be seen around 3590-3600.

GUAR COMPLEX
Good monsoon reports and pre monsoon showers in many parts of India kept pressure on market sentiments for Guar last week. Prices however could find immediate psychological support near the 8000 mark. Rising crude oil prices and firmness in Dollar vs Rupee are supporting factors on the export front from a long term point of view. Short term negativity is however created by the weather factor which remains more crucial in coming weeks.

Others
Trend remained sideways for cotton last week. However firmness in International markets could lend strong support to the prices at these lower levels this week. Market had been supported earlier from strength in International markets amidst lower crop reports from India.
For the current session May RM seed will trade with strong tone in case the contract fails to trade below 3770. On the other hand strong resistance will be seen between 3880 and 3870levels. From a broader perspective bullish outlook soy bean and palm oil higher import duty on mustard oil latest news of government to start procurement soon and drop in the crop acreage shall keep the downside in check.

DHANIYA
Last week Dhaniya Jun Futures started the week on negative note and made a low of 4702. However it witnessed positive movement on Wednesday but overall closed in negative at 4746 with the loss of 2.34% on weekly basis. Technically for this week, we can expect further downside movement in due to trend line resistance on higher levels & formation of bearish flag pattern. For this week, if it breaks the level of 4700, then it can test the level of 4555 during the week. One can make sell position in it by maintaining a SL 4802

GUARSEED10
Last week Guarseed10 Jun Futures started the week on negative note and made a low of 3659 and closed at 3732 with overall marginal loss of 5.76% on weekly basis. And continuously making lower highs and lower lows indicating bearish trend in upcoming session. Technically for this week, we can expect further downside movement in it due to support level breakout & formation of bearish candlestick patterns on the higher levels. For this week, if it breaks the level of 3790, then it can test the level of 3655 during the week. One can make sell position in it by maintaining a SL 3855

COPPER
From last couple of trading weeks market is trading in range. On weekly chart, a bearish candle has formed after an unsuccessful attempt at breaking upside resistance of Rs.470 mark in the June series. However, counter witnessed selling pressure after reaching 12-week peak but trading above key support at Rs.452 mark that can assist prices to recover. However, a break below the same can exert pressure on prices that can lead to next support level of Rs.440 mark. One can make position below the level of 457 for the target of 447 with SL of 463.

NICKEL
After a strong rally for two consecutive weeks, counter paused for the week to take a breath. On weekly charts, prices traded with marginal gains of 0.89% at 934.10 and formed bullis candlestick pattern. Pattern suggests that the bulls in current rally of uptrend are still strong and we can see the positive movement in coming session. RSI on daily charts is trading in positive zone which indicates buying pressure in the counter, which may support it to next level of Rs.980. As of now short term trend on four hourly and hourly charts remains bullish.

JPYINR
Last week JPYINR May Futures started the week on negative note but till the end of the week, all of its earlier losses were erased and it closed at 61.6000 with the overall gain of 0.53% on weekly basis. Technically it’s sustaining above the trend line breakout with the positive RSI and Moving Averages and for this week, we can expect good upside movement in it.
For this week, if JPYINR May Futures breaks the level of 61.8000 then it can test the level of 62.2900 during the week. One can make sell position in it by maintaining a SL of 61.4900.

GBPINR
Last week GBPINR May Futures started the week on negative note but on the last day of the week, we saw slight short covering in it from the lower levels. It closed at 91.0550 with the overall loss of 1.29% on weekly basis. Technically for this week, we can expect further short covering in it from the lower levels due to formation of bullish candlestick pattern on the lower levels on daily chart.

For this week, if GBPINR May Futures breaks the level of 91.2600 then it can test the level of 91.8650 during the week. One can make sell position in it by maintaining a SL 90.8950

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