Commodity Research Report 18 December 2017 Ways2Capital

Page 1


✍ MCX DAILY LEVELS DAILY

EXPIRY DATE

R4

R3

R2

R1

PP

S1

S2

S3

S4

ALUMINIUM

29-DEC-2017

137.50

135.50

133.50

132.50

131.50

130.50

129.50

127.50

125.50

COPPER

28- FEB-2018

470

461

452

448.90

443

439

434

428

416

CRUDE OIL

19-JAN-2018

3775

3739

3703

3690

3667

3650

3631

3595

3559

GOLD

05-FEB -2018

28868

28674

28480

28367

28280

28173

28090

27900

27700

LEAD

29-DEC-2017

171.20

167.90

164.70

163.40

161.50

160.10

158.20

154.90

151.70

NATURAL GAS

26-DEC-2017

198

188

179

173

169

163

159

149

139

NICKEL

29-DEC-2017

816

788

760

749

732

721

704

676

648

SILVER

05-MAR-2018

38455

38027

37599

37402

37171

36974

36743

36315

35887

ZINC

29-DEC-2017

214.90

277.75

208.50

206.90

205.20

203.75

202.15

198.90

195.70

Monday 18 December 2017


✍ MCX WEEKLY LEVELS WEEKLY

EXPIRY DATE

R4

R3

R2

R1

PP

S1

S2

S3

S4

ALUMINIUM

29-DEC-2017

142.80

138.80

134.80

133.20

130.80

129.30

126.80

122.80

118.80

COPPER

28- FEB-2018

502.80

481.50

460.20

453.20

438.90

431.70

417.60

396.30

375

CRUDE OIL

19-JAN-2018

4213

4036

3859

3764

3684

3587

3505

3328

3151

GOLD

05-FEB -2018

29720

29240

28761

28500

28280

20827

27800

27320

26840

LEAD

29-DEC-2017

177.90

172.90

166.60

164.3

161

158.70

155.30

149.70

144

NATURAL GAS

26-DEC-2017

226

208

190

178

171

160

153

135

117

NICKEL

29-DEC-2017

862

817

772

755

727

710

682

637

592

SILVER

05-MAR-2018

39769

38892

38017

37611

37141

36735

36265

35389

34513

ZINC

29-DEC-2017

228.80

220.40

212

208.70

203.62

200.20

195.20

186.80

178.40


✍ FOREX DAILY LEVELS DAILY USDINR EURINR GBPINR JPYINR

EXPIRY DATE 27-DEC-17 27-DEC-17 27-DEC-17 27-DEC-17

R4 66.0400 78.1050 88.7150 58.7850

R3

R2

R1

PP

S1

S2

S3

65.45

64.900

64.550

64.300

00

0

0

77.35

76.650

00

S4

63.950

63.700

63.150

0

0

0

0

76.250

75.900

75.500

75.150

74.450

0

0

0

0

0

0

87.90

87.100

86.600

86.300

85.800

85.500

84.700

00

0

0

0

0

0

0

58.25

57.700

57.500

57.150

56.950

56.600

56.050

00

0

0

0

0

0

0

R3

R2

R1

PP

S1

S2

S3

S4

64.8000

64.5500

64.5500

64.30

64.300

64.050

63.800

63.55

00

0

0

0

00

75.85

75.600

75.350

74.800

74.27

00

0

0

0

50

86.20

85.950

85.800

85.400

85.01

00

0

0

0

50

57.20

57.050

56.950

56.700

56.44

00

0

0

0

25

62.5600 73.6950 83.8850 55.5150

✍ FOREX WEEKLY LEVELS WEEKLY

EXPIRY DATE

USDINR

27-DEC-17

EURINR GBPINR JPYINR

27-DEC-17 27-DEC-17 27-DEC-17

R4 65.0500 77.4250 87.3850 57.9575

76.9000 87.0000 57.7000

76.4000 86.6000 57.4500

76.1500 86.3500 57.3000


MCX - WEEKLY NEWS LETTERS � BULLION Gold prices clung to earlier gains and were poised for their first weekly gain in four weeks on Friday, withstanding pressure from strong equities markets on continued support from this week's interest rate rise by the Federal Reserve. Higher interest rates usually push gold lower because they raise bond yields, reducing the appeal of non-yielding bullion, and boost the dollar, making gold more expensive for holders of other currencies. But markets had priced in Wednesday's rise and the dollar and bond yields fell after the Fed kept its outlook for three rate rises next year unchanged and said proposed U.S. tax cuts would not significantly spur growth. U.S. inflation remained weak, which Chicago Fed President Charles Evans said on Friday undermined the case for rate rises. The dollar recouped some losses as Republican senators worked to resolve disagreements on the tax reform. Major stock indexes hit record highs.

� BASE METAL Among base metals complex, LME Nickel prices traded higher on Monday after the Chinese government slashed the export duties over some steel products which would in return increase demand for the metal. China will cut export taxes on some steel products and fertilisers and ditch those for sales abroad of steel wire, rod and bars from Jan. 1, the Ministry of Finance said on Friday. Recently, INSG report showed the widening of deficit in global nickel market to 65,700 tonnes in the first nine months of the year, from 47,400 tonnes, in the same period of 2016. As per CFTC, Hedge funds and money managers cut their net long position in COMEX copper contracts in the week to Dec. 12. However in Zinc due to ample availability of supply spread between cash & 3 month forward contract has fallen to zero from above $90/ton in October which was the highest since Dec 2006. Aluminum was getting a second boost from separate China data showing production for November slumped to 2.35 million tonnes, which was down 7.7 percent from October and the lowest absolute level since February this year. Copper prices scaled threeweek highs on Friday after the New York open and as expectations of strong demand in top consumer China were reinforced by data showing firm industrial activity. Traders said rising stock market indices on Wall Street had boosted sentiment and sparked a wave of buying on industrial metals markets


ENERGY

Crude oil prices hovered near to Friday’s levels as lack of new price driver casts the shadow over the prices. On Friday, baker Hughes showed the decline in US active rig by 4 to 747 for the first time in six weeks. In the major development in OPEC nations, Nigeria’s PENGASSAN union has threatened to go on strike from Monday after talks aimed at resolving a dispute with domestic oil and gas companies reached a deadlock. In Nigeria, Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN), which mainly works in the upstream oil industry, is clashing with the companies over the laying off of union members. And has threatened os Saturday to go on strike from Monday. Separately, Forties pipeline pipeline, which carries about a one fourth of all North Sea crude output and about one third of Britain's offshore gas production, has been closed since last week, following the discovery of a small crack in part of the system onshore in Scotland. As per CFTC data, the speculator group cut its combined futures and options position in New York and London by 7,542 contracts to 435,200 during the period. The group cut its gross long positions to 435,764 from 439,751. The group cut its short positions to 44,890 from 47,320. NG prices remained negative on Friday as prices went lower around 2.68% in International markets and went down by 3.3% at its closing in MCX futures market.  As per CFTC, U.S. gas speculators cut their net long positions to the least since August 2016 on expectations supplies will be adequate this winter with storage near normal levels, output at record highs and warmer than seasonal winter forecasts.


MCX TECHNICAL VIEW � LEAD MCX LEAD has forming head & shoulder pattern breakout which suggests positive trend for the short term. Above the level of 163.30 Price expected to provide fuel to the rally going ahead. Daily RSI (14) has given a trendline breakout which indicates change in momentum. Daily MACD has entered in a bullish crossover. Based on the above analysis, we expect a smart rally in the MCX LEAD price over the short period of time. BUY LEAD DEC ABOVE 163.30 TGT 163.30 SL 161.5


� SILVER MCX Silver price has closed in the green at the end of last trading session. Comex Silver has closed in the green for the third consecutive sessions. In addition, Comex Silver price has moved back above $16 mark. On the daily chart of Comex Silver, momentum indicator RSI (14) is seen to have reversed from the oversold zone and currently in a bullish crossover. MACD is in bullish crossover. Based on the above technical set up and indicators, we expect a pullback in MCX Silver price. BUY SILVER MAR ABOVE 37500 TGT 38000 SL 37200


✍ NCDEX DAILY LEVELS DAILY

EXPIRY DATE

R4

R3

R2

R1

SYOREFIDR

19-JAN-2018

745.70

739.70

733.80

731.50

SYBEANIDR

19-JAN-2018

3170

3126

3082

RMSEED

19-JAN-2018

4107

4058

JEERAUNJHA

19-JAN-2018

22670

GUARSEED10

19-JAN-2018

TMC

20-APR-2018

PP

S1

S2

S3

S4

727.80

725.60

721.80

715.80

709.80

3065

3038

3021

2994

2950

2906

4009

3991

3960

3940

3911

3862

3813

22260

21850

21650

21440

21240

21030

20620

20210

4013

3961

3909

3888

3857

3837

3805

3753

3701

8021

7841

7661

7562

7480

7382

7301

7121

6941

✍ NCDEX WEEKLY LEVELS WEEKLY

EXPIRY DATE

R4

R3

R2

SYOREFIDR

19-JAN-2018

754.60

745.70

736.70

SYBEANIDR

19-JAN-2018

3440

3314

RMSEED

19-JAN-2018

4304

JEERAUNJH

19-JAN-2018

GUARSEED10 TMC

R1

PP

S1

S2

S3

S4

733

727.50

724.20

718.80

709.90

700.90

3188

3118

3059

2992

2936

2810

2684

4196

4088

4030

3980

3922

3872

3764

3656

24300

23380

22460

21950

21540

21035

20620

19700

18780

19-JAN-2018

4275

4134

3992

3931

3850

3789

3709

3568

3426

20-APR-2018

8328

8034

7740

7602

7440

7308

7152

6858

6564

A


NCDEX - WEEKLY MARKET REVIEW ✍ SPICE COMPLEX NCDEX Jan Jeera falls for the second consecutive day on Friday as market participants initiated fresh selling. For the December contract NCDEX reported record deliveries allocations of 3,633 tonnes on exchange platform in first three days of staggered delivery period. The market is also cautious after it touched all time higher this month. Moreover, good progress of jeera sowing in Gujarat also pressurizes prices. In Gujarat, jeera acreage up by 37.4% to 3.1 lakh ha this year compared to 2.3 lakh ha last year as on 11th Dec. As per government data, Jeera exports during first six month of FY 2017/18 (Apr-Sep) is 77,827 tonnes, up 8.4% compared to last year exports volume for the same period. India's jeera exports in Sep increase 110% on year to 14,742 tn. Jeera arrivals for the first 15 days of Dec down by 50% to 1,985 tonnes on year due to tight supplies and lower stocks.Turmeric Apr contract closed lower on Friday due to fresh selling but prices improved on week due to firm physical demand and expectation of improved up-country demand from the new season. The supplies have improved during last one month due to government auctions and lower exports data. The export of turmeric is down by 15.2% to 56,900 tonnes for the first 6 month of FY 2017/18 compared to last years’ exports. The arrivals have been higher during first 15 days in December this year to 13,033 tonnes compared to 5,820 tonnes last year same month according to Agmarknet data.

✍ OILSEED COMPLEX Mustard Jan futures closed higher on Friday but 1% down on week. Currently the prices looking move according to the winter demand but reports of higher inventories with the traders and farmers keep pressure on prices. According to MOPA, mustard stock with Farmers & Processors as on 30th Nov’17 was at 13 lakh tonnes. Mills across the country crushed 475,000 tn of the oilseed in November, up nearly 6% on month. The acreage of mustard was down 7% till last week at 61 lakh ha, as per latest rabi sowing report by the government. Rajasthan is the largest mustard growing state but the sowing pace is slower than last year at 20.6 lakh ha Vs 27.7 lakh ha.NCDEX Soybean futures closed higher on Friday on fresh buying by the market participants on lower level buying and anticipation of improved demand but down for the week on higher stocks with the mills. The arrivals have been lower in first half of December compared to previous 15 days. As per, Agmarknet, 3.72 lakh tonnes of soybean arrived in physical market in December against close to 5 last year for the same time period. Moreover, in the second half of October about 7.41 lakh tonnes arrived in the market. SOPA increased its meal exports estimates for 2017/18 as government has increased export incentives by 2% to for all meals. According to SOPA,


Soymeal exports from the country in 2017-18 (Oct-Sep) are seen rising to around 20 lakh tn from previous estimate of 15 lakh tn due to a recent rise in export incentives. US Soybean futures closed lower on Friday supported by forecasts of rain in Argentina and higher production forecast in 2018. There is expectation for rain this weekend in dry areas of Argentina, the world's top soymeal exporter. The 2017/18 Brazilian soybean crop is now estimated at 109.1 mt, which is up from the 107.5 mt estimated in November. US soybean planted acreage for 2018 is expected to hit 91.4 million acres, according to Informa analysts.

� OTHER COMPLEX Chana Jan futures jumped higher on Friday on short covering on reports of higher stocks and improved sowing progress. As per government data, India imported about 4.78 lakh tonnes of chana during April-Sep, up by 430% compared the last year imports. As per government sowing data, area under the chana crop across the country was up 13.7% on year at 96.23 lakh ha as on last week. Area under Chana exceeds 90 lakh ha for the second consecutive year. Last year area was close to 99 lakh ha. MP, Maharashtra, Rajasthan and Karnataka exceed normal sowing area this season. The NCDEX have imposed a special margin of 5% on the sell side to support falling prices. MCX Dec Cotton rises 2.76% on week tracking lower arrivals and expectation of fall in domestic output due to pink bollworm attacks in some states. Moreover, higher bonus in Gujarat and increase in consumption by the mills is also supporting prices. As per Cotton Advisory Board, demand from textile mills is likely to be 315 lakh bales this season as against 288.86 lakh bales last season, while exports might go up to 67 lakh bales as against 58.21 lakh bales last season. According to industry sources, cotton exports to Pakistan might be higher this year. ICE cotton rose on Friday boosted by technical buying, as the March contract touched an all-time high and notched an eighth consecutive weekly gain. USDA monthly crop supply and demand report was bullish it raised its U.S. cotton production forecast for 2017-18 by 63,000 bales and exports estimates by 300,000 bales compared with its outlook last month, and projecting ending stocks at 5.8 million bales as against 6.1 million bales seen in November.


NCDEX TECHNICAL VIEW � GUARSEED10 Market is continuously making higher lows forming ascending

triangle formation indicating positive

movement in upcoming session. It is facing important resistance level at Rs.3913 above the level we believe that market can touch the level of Rs.3980 & Rs.4000. Traders can follow the buy on dips strategy. Momentum still positive as the MACD (moving average convergence divergence) index generated a crossover buy signal. The MACD histogram is printing in the black with an upward sloping trajectory which points to higher prices for the GUARSEED. BUY GUARSEED10 JAN ABOVE 3913 TGT 4000 SL 3860


� SYOREF Refined Soy Oil Jan contract jumped higher tracking higher spot prices. However, the prices have been traded sideways during last week due to higher stocks due to improved domestic crushing and higher imports in November. For the second half of December, government further cut the base import price of soy oil, by $20 per tonnes. According to data released by the Solvent Extractors' Association, India vegetable oil imports rose around 6% on year to 12.5 lakh tonnes in November. Soyoil imports surged by 66.7% in November to 2.74 lt compared to 1.64 lt last year. BUY SYOREF JAN ABOVE 730 TGT 740 SL 725


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