BASEMETALS INTRADAY

Base Metals Mar 07, 2008

Important US Data Released:

· The National Association of Realtors said that its index of pending home sales was unchanged in January and down 19.6% from a year ago. The December eurodollars are steady to higher.

Major Headline

Copper was little changed after topping more than $4 a pound, the highest since its record in May 2006, on concern demand will outstrip production of the metal used in pipes and wires.

Copper has surged 31 percent this year as China increased purchases and investors snapped up commodities as a hedge against accelerating inflation. Inventories monitored by the London Metal Exchange have tumbled more than 30 percent in 2008, dropping 1.7 percent today to 135,800 metric tons.

The UBS Bloomberg Constant Maturity Commodity Index of 26 futures contracts jumped as much as 44.6975, or 3 percent, to 1,552.328 yesterday, as oil, gold and corn rose to their highest ever on expectations the U.S. Federal Reserve will further cut borrowing costs and drive the dollar lower.

Nickel added as much as 5.2 percent to $35,150 a ton, the highest since September, and traded at $34,875 a ton at the same time, as BHP Billiton Ltd's nickel mine workers in Columbia remain on strike.

Aluminum Corp. of China Ltd., the nation's biggest producer of the metal, said its smelters in the southern province of Guizhou have resumed operation at 10 percent of production capacity. The company's smelting operations were halted on Jan. 23, and restarted on Feb. 13.

Chambishi Copper Smelter Plc, a unit of China Nonferrous Mining Development Group Co., dismissed more than 400 striking workers for ``riotous behavior'' following a two-day protest over pay and working conditions.

The workers have been given three days to show why they shouldn't be dismissed, Albert Mando, secretary-general of the National Union of Miners and Allied Workers, said in an interview yesterday from Chambishi, 420 kilometers (261 miles) north of the capital, Lusaka. The action was taken while the union is still negotiating with management, he said.

LME Inventory update (6 March, 2008)


COPPER -2350

ALUM. -1900

ZINC -175

NICKEL -36

LEAD -275

TIN +15

MCX Copper April

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 moving average. The downside closing price reversal on the daily chart is somewhat negative.

Recommendations:

MCX Copper April: Buy at 341 Target 347 and 352 Stop loss at 338.50

MCX Zinc March

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 moving average. The downside closing price reversal on the daily chart is somewhat negative.

Recommendations:

MCX Zinc March:

MCX Nickel March

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 moving average. The downside closing price reversal on the daily chart is somewhat negative.

Recommendations:

MCX Nickel March:

Buy at 1300 Target 1330 and 1355 Stop loss 1275

MCX Lead Feb

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 moving average. The downside closing price reversal on the daily chart is somewhat negative.

Recommendations:

MCX Lead March:

Buy at 129.80 Target 133 and 135 Stop loss 126.80

MCXARUN
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