Bullions counter can trade with upside bias as gold prices edged higher on Wednesday, supported by a pullback in the dollar, although caution prevailed as investors awaited minutes from the Federal Reserve’s December policy meeting that could offer hints on the U.S. central bank’s tightening path. Gold can move in range of 55500-55900 while Silver also can move in range of 69500-70500.
Bullions counter can trade with upside bias as gold prices edged higher on Wednesday, supported by a pullback in the dollar, although caution prevailed as investors awaited minutes from the Federal Reserve’s December policy meeting that could offer hints on the U.S. central bank’s tightening path. Gold can move in range of 55500-55900 while Silver also can move in range of 69500-70500. Traders also kept a tab on rising coronavirus infections in top gold consumer China after the country’s abrupt COVID policy U-turn in early December. Spot gold prices in the domestic market have been trading at a steep discount to the metal’s bank rate for an extended period, a departure from the typical premium it trades at, especially during the wedding season.
In base metal counter, Copper can trade on weak bias as it can move in range of 705-725. On the macro front, the dollar jumped on Tuesday, the euro fell on moderating inflation and the Federal Reserve will release minutes from its December meeting on Thursday. The pandemic situation in China is still affecting the processing industry, as most fabricators reported low operating rates with its employees still infected with covid. In addition, more and more terminal players will be closed for Chinese New Year holiday in January, another important cause for accumulating social inventory. Zinc may move on mixed path as it can move in range of 262-273. Aluminum can in narrow range of 202-207.
ENERGY: Crude oil may trade on weaker path as it can test 6300 while taking resistance near 6600 in MCX. Oil prices held their ground on Wednesday after tumbling in the previous session as markets braced for minutes from the U.S. Federal Reserve’s December policy meeting. The Fed raised interest rates by 50 basis points (bps) in December after four consecutive increases of 75 bps each. If the Fed intensifies its rate hikes, that could slow the economy and hamper fuel consumption. The dollar weakened after posting big gains in the previous session. Natural gas prices can tad further lower on forecasts for warmer weather as it can test 330 while taking resistance near 360. Europe’s wholesale natural gas prices also fell Monday to their lowest level since their record highs after Russia invaded Ukraine in late February 2022. A mild winter has enabled European Union countries to tap less gas from stocks that were built up in anticipation of cuts in supplies from Russia, which was the E.U.’s main supplier before the war.
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