Base Metals

Base metals finished up on MCX on short covering ahead of the long weekend holiday on the benchmark LME.Copper most active February finished at Rs.272.30/kg, rising by Rs.1/kg. It tossed in the range Rs.271.75-273/kg.

Meanwhile both copper and zinc futures on SHFE hit their daily limit up for the second consecutive time on Friday despite the sixth interest rate hike of 7.47% by China.

LME will be closed on 24th, 25th and 26th December for Christmas.

Global copper use rose 7.1 percent in the nine months ended Sept. 30, boosted by Chinese demand, the International Copper Study Group said.



MCX Copper Feb (Daily Chart)

Technical Outlook:

Momentum studies have turned bullish; will tend to support reversal action if it occurs. The daily stochastics have crossed over up which is a bullish indication. The stochastics indicators are increasing from over sold level, which is bullish and should support higher prices. The market's short-term trend is positive as the close remains above the 18-day EMA. The downside closing price reversal on the daily chart is somewhat positive.

Recommendations:

MCX Copper Feb: Buy at 268-270 for the target of 276 and 280 with stop loss at 265.50

MCX Zinc Dec (Daily Chart)

Technical Outlook:

Momentum studies have turned bullish; will tend to support reversal action if it occurs. The daily stochastics have crossed over up which is a bullish indication. The stochastics indicators are increasing from over sold level, which is bullish and should support higher prices. The market's short-term trend is positive as the close remains above the 18-day EMA. The downside closing price reversal on the daily chart is somewhat positive.

Recommendations:

MCX Zinc Dec: Buy at 94.50-94.00 for the target of 97.00 and 98.80 with stop loss at 93.20

MCX Nickel Dec (Daily Chart)

Technical Outlook:

Momentum studies have turned bullish; will tend to support reversal action if it occurs. The daily stochastics have crossed over up which is a bullish indication. The stochastics indicators are increasing from over sold level, which is bullish and should support higher prices. The market's short-term trend is positive as the close remains above the 18-day EMA. The downside closing price reversal on the daily chart is somewhat positive.

Recommendations:

MCX Nickel Dec: Buy at 1060-1055 for the target of 1075 and 1090 with stop loss 1045

MCX Lead Dec (Daily Chart)

Technical Outlook:

Momentum studies have turned bullish; will tend to support reversal action if it occurs. The daily stochastics have crossed over up which is a bullish indication. The stochastics indicators are increasing from over sold level, which is bullish and should support higher prices. The market's short-term trend is positive as the close remains above the 18-day EMA. The downside closing price reversal on the daily chart is somewhat positive.

Recommendations:

MCX Lead Dec: Buy at 106 –105.50 for the target of 108 and 109.80 with stop loss at 104.40

Energy

Nymex crude bounced back as US crude oil stocks fell for the fifth time last week and were noted at the lowest level since Feb.2005 and as reports noted that OPEC shipments may decline. However weighing on prices were forecasts of milder weather which will keep demand in a check.

Nymex crude jumped by 2.5% on Friday to settle at the highest price since Dec.12. Nymex crude bounced back as positive US consumer spending report released bolstered confidence in the economy easing concerns about oil demand. Also supporting prices was weaker dollar against the Euro, rally in gasoline futures, and a rise in US equity markets and reports that Opec shipments may fall.

MCX crude may witness thin volumes in coming week due to Christmas holiday in Global market. Thin volumes exacerbate price movements. Also traders will now square positions ahead of the year-end.

MCX Crude Oil Jan (Daily Chart)

Technical Outlook:

Momentum studies are bullish but are now at overbought levels and will tend to support reversal action if it occurs. The daily stochastics have crossed over up which is a bullish indication. The stochastics indicators are rising from oversold level, which is bullish and should support higher prices. The market's short-term trend is positive as the close remains above the 9-day and 18 days moving average. The downside closing price reversal on the daily chart is somewhat negative. Over all technical suggest a bullish market and prices are expected to go further up.

Recommendations:

MCX Crude Oil Jan: Buy at 3655-3660 for target of 3730 and 3765 with stop loss below 3620


Technical Outlook:

Momentum studies are bullish but are now at overbought levels and will tend to support reversal action if it occurs. The daily stochastics have crossed over up which is a bullish indication. The stochastics indicators are rising from oversold level, which is bullish and should support higher prices. The market's short-term trend is positive as the close remains above the 9-day and 18 days moving average. The downside closing price reversal on the daily chart is somewhat negative. Over all technical suggest a bullish market and prices are expected to go further up.

Recommendations:

MCX Natural Gas Jan: Buy at 290-285 for the target of 315 and 325 with stop loss at 270

Bullion

Gold rose after the dollar fell against the euro, boosting the appeal of the precious metal as an alternative investment. Silver also gained. Trading in gold is likely to remain sideways on thin trading towards the closure of the year and volatile action in currency and energy markets.



The dollar fell on Friday against 15 of the 16 most-active currencies. Investment in the StreetTracks Gold Trust, an exchange-traded fund backed by bullion, has climbed to a record 617 metric tons.



Gold also climbed on Friday on demand for a hedge against inflation, the U.S. Federal Reserve's preferred measure of inflation accelerated, a report by the Commerce Department showed.



The Fed, the European Central Bank along with central banks in Canada, Switzerland and the U.K., announced plans on Dec. 12 to coordinate efforts to add funds to the banking system to alleviate the credit squeeze stemming from sub prime mortgages.

MCX Gold Feb (Daily Chart)

Technical Outlook:

Momentum studies have turned bullish; will tend to support reversal action if it occurs. The daily stochastics have crossed over up which is a bullish indication. The stochastics indicators are increasing from over sold level, which is bullish and should support higher prices. The market's short-term trend is positive as the close remains above the 18-day EMA. The downside closing price reversal on the daily chart is somewhat positive.

Recommendations:

MCX Gold Feb: Buy at 10340-330 for the target f 10380 and 10435 with stop loss at 10280

MCX Silver Mar (Daily Chart)

Technical Outlook:

Momentum studies have turned bullish; will tend to support reversal action if it occurs. The daily stochastics have crossed over up which is a bullish indication. The stochastics indicators are increasing from over sold level, which is bullish and should support higher prices. The market's short-term trend is positive as the close remains above the 18-day EMA. The downside closing price reversal on the daily chart is somewhat positive.

Recommendations:

MCX Silver March: Buy at 19050-19000 for the target o 19180 and 19360 with stop loss at 18910