Commodity Research Report Ways2Capital 12 Feb 2018
Added: (Mon Feb 12 2018)
Pressbox (Press Release) -
Gold prices plunged on Friday as the dollar strengthened after the latest U.S. jobs
report showed that the economy added more jobs than forecast in January and wage
growth accelerated. Gold futures for April delivery settled down 0.91% at $1,335.70
on the Comex division of the New York Mercantile Exchange. For the week, prices
were down 1.47%. The U.S. economy created 200,000 new jobs last month, the Labor
Department reported Friday and average hourly earnings rose 2.9% from a year
earlier, the most since 2009.
Zinc prices surged to the highest since 2007 on January 29th 2018 as falling stockpiles
suggested tight supplies, drives zinc prices to new highs. Shortages of refined metal
have seen stocks in LME approved warehouses fall to their lowest since 2008 at
176,275 tonnes. Aluminium ended up 0.3 percent at $2,225, having earlier hit a two-
week low as rising stockpiles in top producer China reinforce worries that the Chinese
market remains in surplus despite capacity cuts.
Oil prices finished lower on Friday to tally a loss for the week, as traders weighed a
steady increase in U.S. output against OPEC's ongoing efforts to drain the market of
excess supplies. For the week, WTI crude lost roughly 1%, while Brent declined about
2.8%. However at MCX due to weak rupee against US dollar it dropped only 0.1 per
Natural gas futures plunged more than 8 per cent for the last week at NYMEX
and around 7.5 per cent at MCX, after weather forecasts showed that
temperatures will not be as cold as previously expected.
Slight weak trend prevailed for Jeer last week as lack of strong demand amidst
expected rising arrivals of the new crop kept pressure on prices. Shifting from
Dhaniya to Jeer due to the latter high prices last year ensured 35% rise in
acreage for Jeer in Gujaratas per traders. Production in Gujarat estimated at
around 2.75 lakh tonnes (approximately 50 lakh bags weighing 55 kg each) last
year is likely to touch 4.12 lakh tonnes this year as per traders.
Turmeric found strong psychological support at 7000 as markets recovered after
the recent fall. Sentiments still have not turned positive as new crop arrivals pick
up with limited demand as of now, even as short term recovery gets noted.
OIL & OILSEEDS
Improving spot demand for soy meal and frequent reports of lower crop size
of India and further drop in Argentine crop production outlook helped soy
bean to recover early week losses and finish on a strong note. We expect
same fundamentals to continue influencing soy bean prices and In case
soy meal demand remains firm then expect the new highs in coming
Soya oil is currently trading in a moderate range and it seems that due to rising
prices of soy bean and soy meal, the physical market participants are forced to
price the commodity lower, just to maintain the crushing activity economically
Profit booking at the higher levels brought some dips to the rising rates for Guar
even as overall fundamentals looked strong from a medium to long term point
of view. Guarseed is facing strong resistance at 5000 as Gum trades near the
10000 mark. Medium term trend remains up due to rising concerns on
production front from recent crop losses due to excess rains in Rajasthan just
few months back.
As per the latest sowing data the sowing area covered is roughly 51.4 lakh ha so
far versus 57.8 lakh ha last year. Going by trade sources roughly 7-8 Lakh bags
are available in the domestic market in the form of stocked inventory and which
will be easily offsetting the requirements till February March i.e. arrival of the
new season crop.
Market are however likely to recover this week. Falling production prospects
from reports of crop damage in India had supported prices earlier. The
Agriculture Ministry estimated acreage during 2017-18 season (Oct-Sep) will
rise 12% last year. Yield is also likely to go up in view of good monsoon
Silver prices reacted towards south with negative returns of 2.88 percent last week. However it is a choppy range where
prices are struggling for last one month. As the counter has got support near Rs.37500 level or $16.20/oz mark which
has been a strong ground area below the level we can see further selling pressure. Daily stochastic oscillator has come
in to selling territory. On the higher side prices may retest upside resistance zone of Rs.37800-38000 zone.
Last week, Nickel prices opened lower and prices corrected sharply for most of the week till low of 216.60. Previously
prices have rallied strongly in the last month after taking strong support at its short term rising trend line. Daily RSI (14)
has given a positive signal. Prices are expected to go higher from these levels towards next strong resistance zone
placed around 830.
The Dhaniya is long to medium term inbearish phase .Currently Dhaniya is showing some corrective move with less
volume indicating negative pressure in it. Caution note selling at lower levels seems risky we advise to sell Dhaniya at
higher level. The oscillator is on SELL signal and Dhaniya is coming down from overbought level For short term Dhaniya
is in sell position. Support for the Dhaniya is 5572. Resistance for the Dhaniya is 5860.
Overall trend of the Castor seed new is bearish for medium long term .Currently Castor seed new is in strong down
trend with good momentum and the trend is supported with good volume. The Castor seed new is now trading in
oversold level. The oscillator is showing SELL signal For short term Castor seed new is in hold short position. Immediate
support for Castor seed new is 4050 .Resistance for the Castor seed new is 4270.
Last week we good saw profit booking in GBPINR Feb Futures from the higher levels and it made a low of 89.2400 during
the week. It closed at 89.6750 with the overall loss of 1.92% on weekly basis. Technically for this week, we can further
expect downside movement in and below the level of 89.1400, it can test the level of 88.5525 during the week. One can
make sell position in it by maintaining a SL of 89.5525.
Last week JPYINR Feb futures started the week on flat note and after that traded positive for the most part of the week.
It made a high of 59.5425 during the week and closed at 56.1650 with the overall gain of 1.12% on weekly basis.
Technically for this week, we can expect further upside movement in it as it sustaining near to major resistance level and
above the level of 59.30000, it can test the level of 59.8250. One can make buy position in it by maintaining a SL of
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