Commodity Morning Trading Guide | Globe Capital
17-Oct-2022
Commodity Morning Trading Guide

Bullions counter may witness some short covering at lower levels amid pause in the dollar rally, although an impending oversized rate hike by the U.S. Federal Reserve capped the upside. Gold can move in range of 50200-50600 while Silver can move in range of 55200-56000.

Report Overview

BULLIONS

Bullions counter may witness some short covering at lower levels amid pause in the dollar rally, although an impending oversized rate hike by the U.S. Federal Reserve capped the upside. Gold can move in range of 50200-50600 while Silver can move in range of 55200-56000. A “hotter-than-expected” September inflation report doesn’t necessarily mean the U.S. central bank needs to raise rates higher than officials projected at their most recent policy meeting, St. Louis Fed President James Bullard said on Friday, though it does warrant continued “frontloading” through larger hikes of three-quarters of a percentage point. Holdings of SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, fell 0.34% to 941.13 tonnes on Friday.

BASE METALS

In base metal counter, Copper can trade with positive bias as it can move in range of 648-657. MMG planned to initiate international arbitration against Gecamines, the Congolese national mining company, after its two mining areas near the Kinsevere copper mine were occupied by a Congolese army. Besides, the collapse of the construction platform of Antofagasta’s Los Pelambres desalination plant in Chile in September is expected to reduce Antofagasta’s copper output by 30,000 mt in metal content in 2023, and copper production in 2022 will also be difficult to meet the previously set production guidance. Zinc may remain sideways bias as it can move in range of 265-272. Aluminum can trade with sideways bias in range of 200-205 in MCX.

ENERGY

Crude oil may witness range bound movement on mixed fundamentals. Oil found support from a combination of factors, including Chinese President Xi Jinping’s comments at the Party Congress that reassured accommodative policies for the economy, a positive sign for demand outlook. Looking ahead, oil prices are expected to remain volatile as production cuts by OPEC+ will tighten supplies ahead of the European Union embargo on Russian oil, while a strong U.S. dollar and further interest rate increases from the U.S. Federal Reserve limit price gains. Overall it can move in range of 6950-7200. Natural gas prices may slip further lower as it can test 500 in MCX. The average amount of gas flowing to U.S. LNG export plants fell to 10.9 bcfd so far in October from 11.5 bcfd in September. That compares with a monthly record of 12.9 bcfd in March.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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