Base Metals

Copper turned down after trading at the highest level of Rs. 292.65 per kg on MCX Feb Contract. Copper trades upbeat on Multi Commodity Exchange lifted by the positive sentiments in gold. Also the complex was bolstered by the index re-balancing in international markets. Zinc Jan registered at high of Rs. 102.60 per kg and closed with loss similarly Nickel Jan closed with loss after registering a weekly high of Rs. 1203 per kg.

· A stellar debut for gold futures traded on the Shanghai Futures Exchange Wednesday marked pent-up investment interest by China - the world's third largest gold consumer - and analysts said the expectation of a sustained bull run might encourage more follow-through buying.

· Although the premium in China can be a positive cue to drive prices up in other bourses, observers said enthusiasm alone won't guarantee any shortcut for the market to "have a say" on global prices, as some domestic players hope.

· BHP Billiton Ltd., the world's biggest mining company, may win a reduction in copper processing fees from Japanese smelters next week after cutting the amount paid toChina, analysts including Atsushi Yamaguchi at UBS AG said.

· Japan bought 4.6 million tons of copper concentrate for the first 11 months to November, according to the finance ministry's trade data. Japan's purchases compared with China's total imports of 4.1 million tons in the same period last year.

· Pan Pacific imports 1.8 million tons to produce 600,000 tons of refined copper a year. Sumitomo Metal Mining imported 1.35 million tons of copper concentrate last year.

· Energy, industrial metals and agricultural commodities rallied yesterday as the dollar fell, increasing the demand for alternative assets. The dollar fell on concern a housing slump and turmoil in U.S. credit markets may force the Federal Reserve to cut interest rates.


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 283-284 for the target of 290 and 294 with stop loss at 276.50



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: Sell at 99.50-99 for the target of 96 and 94 with stop loss at 101.50



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: Sell at 1160-70 for the target of 1130 and 1105 with stop loss at 1190

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 106.15 and 108.50 with stop loss at 101.80

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