Commodity research report 03 october 2017 ways2capital

Page 1


✍ MCX DAILY LEVELS DAILY

EXPIRY DATE

R4

R3

R2

R1

PP

S1

S2

S3

S4

ALUMINIUM

31-OCT-2017

142.00

141.00

140.00

139.00

138.00

137.00

136.00

135.00

134.00

COPPER

30- NOV-2017

442.00

438.00

434.00

431.50

429.40

425.10

421.10

417.10

414.10

3476

3450

3425

3399

3376

3352

3327

3301

3277

CRUDE OIL

18-OCT-2017

GOLD

05-DEC--2017

29785

29735

29685

29635

29585

29535

29485

29434

29385

LEAD

31-OCT-2017

167.40

166.40

165.40

164.40

163.40

162.40

161.40

160.40

159.40

NATURAL GAS

26-OCT-2017

206.10

204.10

202.10

200.10

198.10

196.10

194.10

192.10

190.10

NICKEL

31-OCT-2017

708.00

701.00

693.00

686.10

680.70

673.00

665.00

659.10

653.10

SILVER

05-DEC--2017

40150

40000

39850

39700

39543

39400

39200

39000

38800

ZINC

31-OCT-2017

213.90

212.00

210.8

209.90

208.90

207.50

206.00

204.50

203.00

✍ MCX WEEKLY LEVELS WEEKLY

EXPIRY DATE

R4

R3

R2

R1

PP

S1

S2

S3

S4

ALUMINIUM

31-OCT-2017

146.00

144.00

142.00

140.00

138.00

136.00

134.00

132.00

130.00

COPPER

30- NOV-2017

456.00

450.00

442.00

434.00

429.40

421.10

414.10

408.00

400.00

3576

3525

3476

3425

3376

3327

3277

3227

3177

CRUDE OIL

18-OCT-2017

GOLD

05-DEC--2017

29985

29885

29785

29685

29585

29485

29385

29285

29185

LEAD

31-OCT-2017

171.40

169.40

167.40

165.40

163.40

161.40

159.40

157.40

155.40

NATURAL GAS

26-OCT-2017

214.1

210.10

206.10

202.10

198.10

194.10

190.10

186.10

182.10

NICKEL

31-OCT-2017

738.00

725.00

708.00

693.00

680.70

665.00

653.10

638.10

623.10

SILVER

05-DEC--2017

40750

40450

40150

39850

39543

39200

38800

38200

36800

ZINC

31-OCT-2017

220.90

216.90

213.90

210.8

208.90

206.00

203.00

200.00

197.10

Tuesday 03 October 2017


✍ FOREX DAILY LEVELS DAILY

EXPIRY DATE

R4

R3

R2

R1

PP

S1

S2

S3

S4

USDINR

27-OCT-17

67.51

67.01

66.51

66.00

65.51

65.01

64.51

64.01

63.51

EURINR

27-OCT-17

79.99

79.49

78.99

78.20

77.47

76.80

76.20

75.80

75.20

GBPINR

27-OCT-17

89.99

89.30

88.99

88.20

87.78

87.00

86.20

85.50

84.70

JPYINR

27-OCT-17

59.11

58.91

58.71

58.51

58.31

58.11

57.91

57.71

57.51

✍ FOREX WEEKLY LEVELS WEEKLY

EXPIRY DATE

R4

R3

R2

R1

PP

S1

S2

S3

S4

USDINR

27-OCT-17

66.51

66.25

66.00

65.75

65.51

65.25

65.01

64.75

64.51

EURINR

27-OCT-17

78.99

78.60

78.20

77.80

77.47

77.10

76.80

76.50

76.20

GBPINR

27-OCT-17

88.99

88.51

88.20

87.99

87.78

87.40

87.00

86.60

86.20

JPYINR

27-OCT-17

58.71

58.61

58.51

58.41

58.31

58.21

58.11

58.01

57.91


MCX - WEEKLY NEWS LETTERS � BULLION Spot gold declined by 0.66 percent on Monday to close at $1270.7 per ounce while Indian markets were closed on 2nd October on account t of Gandhi Jayanti. MCX gold prices declines by 1.2 percent last week to close at Rs.29557 per 10 gms. Stronger dollar on account of good economic data from the US coupled with expectations that the US FED will push the button for the rate hike this December led to the fall in gold prices in the recent weeks. The euro also came under pressure after Spanish police used batons and rubber bullets to thwart an independence vote in Catalonia on Sunday, leaving hundreds injured. The single currency was down 0.6 percent versus the dollar on Monday. Speculators cut their net long positions in COMEX gold and silver contracts in the week to Sept. 26, further exerting downside pressure on gold. MCX Gold and Silver may note choppy trade in line with international market but bias may be on the downside. COMEX gold trades mixed near $1285/oz after testing the lowest level since mid-Aug. Supporting gold price is continuing tensions relating to North Korea and ETF inflows which show higher investor interest. However, weighing on price is increased expectations of Fed’s interest rate hike and optimism about US economy. Gold has fallen sharply in last few days and we are now seeing some consolidation due to lack of fresh cues. Position squaring ahead of weekend, month end and quarter end could add to choppiness in price. Hence we suggest waiting for higher levels to go short in gold. COMEX Silver trades mixed near $16.9/oz amid rangebound movement in gold and mixed trade in industrial metals. Gold has turned rangebound amid lack of fresh cues. Industrial metals are mixed but remain supported by demand optimism. Silver ETF investors have moved to sidelines after brief inflows earlier this week. Risk sentiment may result in mixed trade in gold and industrial metals keeping silver price choppy but bias may be on the downside.


� BASE METAL Base metals on LME trade choppy in early trades today after most metals ended on a higher note yesterday. LME Nickel was the best performer with 1.95% gains followed by more than 1.3% rise in Copper and Zinc prices. In other metals, Lead ended 0.3% higher while Aluminium closed almost unchanged. The metals pack trades choppy today amid mixed cues. On positive note lending support to the prices is hope of robust demand from top consumers China and US. Also supporting prices is expectation of improvement in liquidity in China as the nation plans to expand a program to ease reserve requirements for banks lending to small businesses. Meanwhile on fundamental front, falling stocks at exchange warehouses and signs of tightness in case of most metals may also lend support to the prices. Meanwhile Aluminium, Lead and Zinc prices may also seek support from worries over lower production from China due to winter related output curbs. According to a report from SMM, Zinc galvanizing plants in northern China have been cutting output this month during environmental checks. Big-size plants are running at approx. 70% of capacity, while medium-to- small plants are running at approx. 45%. However capping the upside is recent rebound in US Dollar and lingering worries over North Korea. US Dollar hit highest level in one month amid rising odds of December rate hike and proposed tax overhaul in US. In case of Copper, prices may also come under pressure amid signs of ample supplies in physical market as market participants release inventories in South Korea due to geopolitical tensions on the peninsula while Nickel prices may also come under pressure amid demand uncertainty from China along with signs of rising supply from Indonesia and high inventory overhang.On Monday, LME Copper prices rose 0.2 percent in absence of major economic data and Chinese markets on the eve of Golden week holiday. Last week, LME Copper prices surged 0.7 percent to close at $6493/t as National Bureau of Statistics said that the profits of China's industrial firms registered the fastest growth in four years in August buoyed by rising product prices and falling costs. Also, decline in LME stocks for seven consecutive sessions pushed the inventories lower by around 5 percent with most withdrawals at South Korean warehouses. Also, BHP-controlled company said Escondida mine in northern Chile, the world's largest copper operation, produced 327,863 mt of copper, in the first six months of the year, declining 39% on the year. However, limited risk appetite owing to fiery war of words between the US and North Korean President restricted sharp upisde


✍ ENERGY Crude Oil- MCX Crude may note mixed trade in line with international market but bias may be on the upside. NYMEX crude has turned choppy after testing the highest level since March. Supporting price is optimism about US economy, tensions in Iraq’s Kurdish region, recovery in US refinery demand, decline in US crude stocks and expectations that OPEC may extend production cuts. However, weighing on price is higher US crude production, recent gains in US dollar and mixed economic data from major economies. Crude has rallied sharply in anticipation of OPEC’s production cut extension but we are seeing signs of exhaustion hence we suggest waiting for lower levels to buy. Focus today will be on US economic data and US weekly crude rig count. WTI oil prices declined by more than 3 percent last week while prices declined by 2.1 percent on Monday to close at $50.6 per barrel. Indian markets were shut yesterday on 2nd October for Gandhi Jayanti, MCX oil prices declined 1 percent to close at Rs.3376 per barrel Rise in U.S. drilling and higher OPEC output put the brakes on a rally that helped prices notch their biggest third-quarter gain in 13 years. Iraq announced its exports rose slightly in September while a Reuter’s survey showed OPEC overall boosted output. U.S. drillers added six oil rigs in the week to Sept. 29, bringing the total count to 750, data from General Electric Co's Baker Hughes energy services firm showed on Friday Natural Gas- MCX Natural gas may note mixed trade in line with international market but bias may be on downside. NYMEX natural gas trades in a narrow range near $3/mmBtu after yesterday’s decline. Prices are under pressure as market players are focusing on slack weather demand during fall season. However, supporting price is smaller than average rise in gas stocks and forecast of hot weather in US over next few days.


MCX TECHNICAL VIEW � SILVER In the daily chart, MCX Silver price has taken a good support of daily trend and traded above. Furthermore, it has formed third point reversal pattern in daily chart, which indicate reverse move in the prices. Moreover, price has sustained above 100 EMA on the daily chart, which confirms reversal of the earlier trend. In addition, RSI has also supported the prices and traded above the line, which suggests near term bullishness. Short term trend remains bullish; on the upper end price may move towards 40500 over the short term.


� CRUDE OIL During the last week, crude oil October contract price extended its gains for the fourth successive week and surged till the high of 3472 and in the later session it corrected slightly and finally ended at 3373. On the technical front, prices have breached the triangle pattern trend line and settled above that but on the higher side, it failed to surpass the swing high resistance of 3478. Going forward, the key support is at 3300 and resistance is seen at 3478. Surpass above 3478 will provide further bullish strength and extend the prices till the previous high of 3770 levels. Momentum indicator RSI and MACD are still on positive mode indicating bullish strength. For the week, we recommend buying on dips around 3312 for the targets of 3470 and then 3550 levels.


� COPPER After taking the supports of the rising trend line around 417 levels, copper prices rebounded from the same. In the last week, it extended the upmove till the high of 433.40 and finally ended at 427.95. According to the trend line immediate support is at 417 and below that key head and Shoulder neckline support lies at 406. The overall trend is still looking firm and resistance for the week is seen at 437 then 443 levels. The momentum indicator RSI and MACD are on the positive note, while stochastic has made a negative cross over. For the weesk, we expect copper prices to remain sideways to bullish and recommend buying around 425 levels with stop loss at 416 levels.


✍ NCDEX DAILY LEVELS DAILY

EXPIRY DATE

R4

R3

R2

R1

PP

S1

S2

S3

S4

SYOREFIDR

20-NOV 2017

667

666

665

664

663

662

661

660

658

SYBEANIDR

20-NOV 2017

3170

3120

3070

3020

2994

2950

2900

2850

2800

RMSEED

20-NOV 2017

3945

3895

3845

3800

3745

3700

3650

3600

3550

JEERAUNJHA

20-NOV 2017

19920

19720

19520

19320

19120

18920

18720

19520

18320

GUARSEED10

20-NOV 2017

3935

3890

3830

3780

3735

3685

3635

3585

3535

TMC

20-NOV 2017

7512

7462

7412

7362

7312

7262

7212

7162

7112

✍ NCDEX WEEKLY LEVELS WEEKLY

EXPIRY DATE

R4

R3

R2

R1

PP

S1

S2

S3

S4

SYOREFIDR

20-NOV 2017

715

704

696

688

680

672

664

650

640

SYBEANIDR

20-NOV 2017

3400

3300

3220

3177

3133

3093

3053

3000

2900

RMSEED

20-NOV 2017

4000

3900

3820

3880

3749

3700

3650

3550

3450

JEERAUNJHA

20-NOV 2017

20600

20400

20100

19810

19650

19410

19150

18900

19600

GUARSEED10

20-NOV 2017

4000

3920

3880

3810

3752

3670

3590

3500

3400

TMC

20-NOV 2017

7650

7600

7520

7450

7381

7300

7220

7150

7050


NCDEX - WEEKLY MARKET REVIEW � SPICE COMPLEX Jeera and Turmeric at NCDEX resumed its upswing tracking strong fundamentals. Dhaniya futures faced resistance at higher levels due to profit booking. Cardamom at MCX (Oct) extended losses due to profit booking. Prices of Turmeric are likely to extend its upswing and Cross Rs. 8000/qtl levels in coming sessions at NCDEX (Oct) futures on expectation of lower output due to unsupportive weather conditions in major growing areas. Prices of Jeera are likely to get support at lower levels and test resistance of Rs.20050/qtl at NCDEX (Oct) due to low availability of stock in physical market and quality concerns. Downside in Dhaniya futures is likely to remain limited on support of lower levels buying. Rs.4450/qtl is likely to act as a good support at NCDEX (Oct). India exported 3,06,990 tonnes of Spices worth Rs 4,589.14 crore during the first quarter of the 2017-18 financial year, up 35% as compared to 2,27,938 tonnes in the corresponding period last year, the Spices Board of India said. Below normal monsoon rainfall in major growing regions, lower carryover stocks and better export demand likely to support Cardamom prices in near term.NCDEX Jeera for Oct delivery closed fall for the second consecutive week on weak physical demand as exports are usually lower during the months of September, October and November. Moreover, there are assumptions that the area under jeera may increase by more than 30% in coming rabi season due to higher prices. The arrivals have been lower during the first 25 days of September at 5,713 tonnes compared to 5,851 tonnes in August for same period. India's jeera exports in Jun surged 29.6% on year to 13,503 tn. However, as per government data, Jeera exports during first quarter in FY 2017/18 (Apr-Jun) is 41,707 tonnes, down 10.8% compared to last year exports volume for the same period. Turmeric futures for October delivery closed lower for third consecutive week on anticipation of rise in supply as AP Markfed is expected to auction about 48,500 tonnes of turmeric procured under the price stabilisation scheme to support farmers in October. For 2017/18, turmeric sowing in Telangana, as on 27th Sep, down 1.5% to 44,956 hectares as compared to last year acreage of 45,633 hectares. The production estimate of turmeric for 2016/17 is pegged at 11.32 lakh tonnes by government in 3rd advance estimate higher from 9.43 lakh tonnes in 2015/16. For 2017/18, turmeric sowing in Telangana, as on 27th Sep, down 1.5% to 44,956 hectares as compared to last year acreage of 45,633 hectares.


� OILSEED COMPLEX U.S. soybean futures fell Monday on pressure from the expanding U.S. harvest and expectations of a big crop that should more than meet demand. Condition ratings for soybeans were 1 point higher. Soybean shipments during the week of 9/28 totaled 894,250 MT, 13.74% lower than last week and 19.45% behind this ti me last year. The USDA reported that 151.605 mbu of soybeans were crushed during the month of August, slightly under expectations. That lagged last year by 2.58% but was 7.82% larger than a year ago.Soybean at NCDEX (Oct) traded down tracking volatility in USD/INR. Downside in Soybean likely to remain limited on support of weaker Rupee and Festive demand. As per reports, Malaysia Sep 1-25 palm oil exports jump 16% on improved demand. Overall outlook of the Oil and Oil Seeds complex looks bullish ahead of Festive season. NCDEX (Oct) Castor witnessed some recovery on lower levels buying. Castor sowing in Gujarat grew by 3.72% to 583,700 hectare while cultivation of paddy spurted by 2.87% to 805,400 hectare till Sep 25 compared to same period a year ago, data showed. MCX (Oct) Mentha Oil traded down on profit booking; fall in prices likely to cushion by robust export demand.NCDEX Soybean Oct futures closed down lower last week on expectation of increase arrivals of new season crop and reports that government has permitted states to extend the limits on stocks of oilseeds and edible oils with traders and mills till September 30, 2018. As per prices of soybean move below the MSP in key physical markets, central government has given approval for procurement of 100,000 tn soybean from farmers in Maharashtra and 150,000 tn of the oilseed from Rajasthan at minimum support price. Mustard Oct futures closed lower last week due to higher stock levels in the country despite good physical demand from the oil mills. Moreover, country's top mustard producing state, Rajasthan, has set a target of 37.7 lakh tonnes production in 2017-18 (Jul-Jun), 4.3% lower from the output a year ago. There are improved mustard meal exports in first 5 month of FY 2017/18. Country exported 216,258 tonnes mustard meal during this period which is 122% higher on year. India's mustard meal exports for the month of July also rose 56.4% on year to 50,649 tonnes as per SEA data. As per SEA recent data, mustard oil imports for period Nov-Aug down 21% to 2.40 lt in current oil year compared to 3.00 lt in the previous year.


� OTHER COMPLEX NCDEX (Dec) Cocudakl witnessed recovery from lower levels due to short covering. Kapas and Cotton prices at futures traded volatile due to short covering. Downside in Kapas likely to remain limited from current levels on support of lower levels buying. Chana futures witnessed recovery from lower levels due to short covering. Downside likely to remain limited on support of festive demand. Guar futures traded down tracking downside in USD/INR. Strong support for Guar NCDEX (Oct) is seen at Rs.3580/qtl levels. Overall sentiments likely to remain firm on improved export demand and Weak Rupee against US Dollar. Buy on dips is advised to the traders. Gujarat's groundnut sowing dropped to 1.6 million hectare till Sep 25 during current crop year compared to 1.64 million hectare in the same period a year ago, data released by Directorate of Agriculture, government of Gujarat showed. Buying momentum likely to accelerate above Rs.1450/qtl levels at NCDEX Barley (Oct) futures.Sugar Futures closed unchanged last week that the production in the country will jump 24% in 2017/18 to to around 25 mt. The country's sugar output in the ongoing 2016-17 marketing year (October-September) is estimated to be lower at 20.2 mt because of poor rains. India is the world's second biggest sugar producer. March raw sugar settled up 0.21 cent, or 1.5 percent, at 14.31 cents per lb, slightly paring gains after failing to breach the 40-day moving average at 14.46 cents. Prices rose on short-covering despite a larger-than-expected delivery against October futures on Friday that was viewed by many as bearish.MCX Cotton futures closed higher last week on reports of lower than expected domestic production forecasted by the government. However, arrival of new season cotton is keeping the prices in a narrow range. As per latest data from Agricultural Ministry, the area under cotton across the country was at 122 lakh ha as on last week, up nearly 18.7% on year. Acreage was higher than the normal of 11.49 mln ha for the period, based on the average of last five years. According to the first advance estimates for 2017-18 released by the government, India's 2017-18 (Jul-Jun) cotton output is pegged at 322.7 lakh bales (1 bale = 170 kg), down 2.5% from 330.9 lakh bales in 2016-17. ICE cotton futures fell nearly 1.3 percent on Monday to mark its lowest level since Aug. 25, hurt by selling by funds and suitable weather conditions for harvesting of the natural fiber crop. The US cotton harvest was reported at 17% complete as of Sunday, compared to the average of 13%. Speculators cut their net long position in cotton contracts for the second straight week. Dealers cut their net long position by 5,007 contracts to 57,779 contracts in the week to Sept. 26.


NCDEX TECHNICAL VIEW � SOYABEAN After a long consolidation soybean prices finally breached the supports of 3100 and tumble till the low of 3027 and settled at 3033 losing 4.80%. On the daily chart prices have penetrated the bearish Head and shoulder chart pattern. Hence going forward the trend is likely to remain bearish and the targets according to pattern are projected till 2845 levels. Whereas, for the week immediate support is seen at 2980. Momentum indicator RSI and Stochastic have turned negative while the MACD is still on the positive note on a weekly basis. For the week, we expect soy bean prices to remain under pressure and traders can initiate short positions on minor pull back around 3075 levels for the targets of 2980 then 2930 levels.


� RM SEED NCDEX RMSeed (Oct) continues to form higher highs and higher lows on the daily time frame. Strong supports are now placed at Rs.3680 / 3630 whereas Rs.3800 / 3875 are expected to act as stiff resistances. Trend remains sideways to bullish as long as price stays above Rs.3630 mark


� SOYA OIL NCDEX RSO (Oct) continues to rise within an upward sloping trend channel C - C1. Recently, price could not sustain above key resistance near Rs.674 and has reversed sharply. The short-term correction could continue targeting key support near Rs.657 /650 level. Dip buying near mentioned support is advised for the week


� JEERA NCDEX Jeera (Oct) continues to trade in a broad range of Rs.18750 - 20300 and there is no clear direction yet. Strong supports are placed at Rs.18750 / 18100 whereas Rs.19500 / 20000 are expected to act as resistances. Either side sustained Either side sustained breach of the mentioned levels could be decisive.


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