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    Commodity outlook: Gold, silver on course to a good day in office

    Synopsis

    The yellow metal is heading for its first weekly gain in four.

    GettyImages-825079000Getty Images
    Gold can take support near Rs 30,500 and can face resistance near Rs 30,800 on MCX. While silver can take support near Rs 36,900 and it has resistance near Rs 37,600.
    Gold prices are headed for a weekly gain as the US dollar faced some headwinds.

    MCX Gold rose 0.34 per cent to Rs 30,702.00 per 10 grams at around 12 pm while MCX Silver was up 0.79 per cent at Rs 37,553 per kg.

    Investors are tracking next week's Federal Reserve meeting with great interest, which will have a big bearing on risky assets of emerging markets, including India.

    We get you an analysis on outlook of various commodities by brokerage SMC Global Securities.

    Bullion
    The yellow metal is heading for its first weekly gain in four. Gold can take support near Rs 30,500 and can face resistance near Rs 30,800 on MCX. While silver can take support near Rs 36,900 and it has resistance near Rs 37,600.

    The US central bank is widely expected to raise benchmark interest rates and shed light on the path for future rate hikes. Higher interest rates dent demand for non-interest yielding gold and boost the dollar against which it is priced.

    Base metals
    Prices of base metals are likely to move with an upside bias, adding to their recent gains on easing of trade fears. Copper can face resistance near Rs 445 and take support near Rs 434. London copper rose on Friday and was on track to post its biggest weekly advance in four weeks as investors felt that trade tariffs would have a softer impact on global growth than earlier feared. Global miner BHP Billiton has said a fire at its Spence copper mine in Chile had forced it to partially shut down operations.

    Zinc's resistance is coming up near Rs 172 and support near Rs 168. Premiums for zinc have surged to $345 a tonne, the highest in at least six years amid a squeeze on supply in China. Lead can take support near Rs 143 and hit a hurdle near Rs 148 on MCX. Nickel can take support near Rs 895 while its upside will be capped near Rs 914.

    Oil
    Crude oil may show a sideways to weak bias as prices eased after US President Donald Trump called on OPEC to "get prices down now!". This has slowed an upward surge that had pushed the market toward four-year highs.

    The US sanctions were imposed by Trump in response to Iran's nuclear programme, which the White House says is designed to produce weapons, an allegation Tehran denies. The Organization of the Petroleum Exporting Countries and other producers, including Russia, will meet on Sunday in Algeria to discuss how to manage supply increases to offset the loss of Iranian barrels.

    Overall, oil can take support near Rs 5,000 and may face resistance near Rs 5,090 on MCX.

    Natural gas may open on higher side as it can test Rs 216 on MCX. US natural gas futures jumped to their highest in four weeks on Thursday on forecasts of unusually high demand this week because of lingering heat in parts of the country.

    Spices

    Turmeric futures (October) are expected to trade with a downside bias and test Rs 6,400 levels. Jeera futures
    (October) will possibly take support near Rs 19,375 levels. China and Bangladesh are now importing the spice in a sporadic manner.

    Cardamom futures (October) are seen to draw support from near Rs 1,400 levels and trade with an upside bias. A likely hit to the availability of this aromatic spice following the floods in the main growing areas in Kerala will keep the prices elevated.

    Soybean
    Soybean futures (October) are likely to trade with an upside bias in the range of Rs 3,325-3,315 levels on account of lower level buying. The demand for soymeal is the major concern right now and it is the deciding factor for soybean price trend as crushers get 80-82 per cent soymeal while crushing the seed.

    The upside in mustard futures (October) may face resistance near 4255 levels. dull. Soy oil futures (October) are seen to trade sideways in the range of Rs 725-732 while CPO futures (September) might witness a plunge
    towards Rs 582-580 levels.

    Other commodities
    Guar seed futures (October) are expected to take support near Rs 4,150 and trade with an upside bias. Guarseed and guargum prices firmed up sharply at the spot markets amid strong buying at lower levels amid worries about the lower crop in the wake of dry weather in key producing belts of Rajasthan.

    India's rainfall deficit in the ongoing monsoon season widened to 10 per cent, hovering on borderline drought conditions, following below-normal showers every month, a pattern of consistent shortfall not seen since 2004.

    Cotton futures (October) may trade sideways in the range of Rs 22,200-22,300 levels.



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    (What's moving Sensex and Nifty Track latest market news, stock tips and expert advice, on ETMarkets. Also, ETMarkets.com is now on Telegram. For fastest news alerts on financial markets, investment strategies and stocks alerts, subscribe to our Telegram feeds .)

    Download The Economic Times News App to get Daily Market Updates & Live Business News.

    Subscribe to The Economic Times Prime and read the Economic Times ePaper Online.and Sensex Today.

    Top Trending Stocks: SBI Share Price, Axis Bank Share Price, HDFC Bank Share Price, Infosys Share Price, Wipro Share Price, NTPC Share Price

    ...more
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