Base Metals

Copper prices though washed entire day’s gains as profit taking crept in and the US economic concerns rose once again from weaker than expected jobs data and rise in unemployment rate.



· The metal complex finished the Friday session with losses on poor US employment data. Meanwhile Dow Jones finished down by 256.54 points and FTSE by 130.9 points. Gold and oil also slipped.



· As per government reports, US unemployment rate stood at 5%, the highest in two years. In December the number of jobs added were a meager 18,000 as against a forecast of 70,000.



· Copper continued to trade better during the early trading hours following repots of a strike in Chambishi Copper smelter in Zambia. The smelter workers, around 500 in number, went on a strike for better pay and work conditions.



· The prices also obtained support from declines in SHFE weekly copper inventories and dollars weakness.


MCX Copper Feb (Daily Chart)



Technical Outlook:

Momentum studies are still 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 moving average. The downside closing price reversal on the daily chart is somewhat negative.

Recommendations:

MCX Copper Feb: Buy at 274-75 for the target of 279 and 282 with stop loss at 270.50



MCX Zinc Jan (Daily Chart)



Technical Outlook:

Momentum studies are still 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 moving average. The downside closing price reversal on the daily chart is somewhat negative.

Recommendations:

MCX Zinc Jan: Buy at 99.00-98.50 for the target of 103.20 and 105 with stop loss at 97.60



MCX Nickel Jan (Daily Chart)



Technical Outlook:

Momentum studies are still 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 moving average. The downside closing price reversal on the daily chart is somewhat negative.

Recommendations:

MCX Nickel Jan: Buy at 1105-1100 for the target of 1135 and 1160 with stop loss at 1080

MCX Lead Dec (Daily Chart)



Technical Outlook:

Momentum studies are still 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 moving average. The downside closing price reversal on the daily chart is somewhat negative.

Recommendations:

MCX Lead Jan: Buy at 103-102.50 for the target of 104.80 and 106.50 with stop loss at 100.80

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