energy intraday

Major Headline:

· Crude oil on Nymex retreated from intraday high but has continued to trade with modest gains near USD92 per barrel in the electronic trade session Monday extending the 5.3 per cent rise noted in previous two trading sessions following which it settled on Friday at the highest price since Jan 30.

· Venezueala's President, Hugo Chavez, threatened to stop oil sales to the U.S. if ExxonMobil wins its court battle to gain back property that was lost when Chavez took over the oil industry. Recently, a British court ruled in ExxonMobil's favor to freeze $12 billion of Venezuelan assets. March crude oil is steady to lower.

· A fake bomb threat on Sunday led to a halt in production and evacuation of workers at the Safe Scandinavia accommodation rig in North Sea which is operated by Britannia Operators. However reports noted that workers are being returned to the rig.

· However weighing on prices are concerns that global economic slowdown will affect oil demand. The Group of Seven industrial powers (G7) finance officials on Saturday said that the world and G7 economies both have retained solid fundamentals however downside risk to the economies remain.

· Crude oil futures have lately taken cues from equity markets. U.S. stock indices noted mixed closing Friday. Asian stocks markets weakened today while European markets are seen opening lower.

· G7 also asked the Opec and other oil producers to raise production. Opec at its Feb 1 meet decided to keep output steady stating that stockpiles may increase and on concerns that economic slowdown will affect demand. Opec will now meet on March 5 to take stock of the market condition and some have indicated that the oil cartel may cut down production.

· According to Dow Jones newswires report, extremely cold air and gusting winds blasted the U.S.Great Lakes and Northeast early Monday while snow fell over the Midwest, OhioValley and Great Lakes. Also extremely cold air from the Upper Midwest was to keep the Northeast very chilly.

· Temperatures in the Northeast are forecasted to rise only into the 10s, 20s and 30s while the Upper Midwest should struggle to rise above 0 degrees.

· Colder weather increases demand for natural gas leading to larger draw from natural gas stocks. After the record high draw of 274 Bcf for the week ended Jan 25, U.S. working gas stocks noted a bigger than expected decline of 200 Bcf last week following which its surplus over five year average stocks for the period narrowed while deficit from stocks a year ago broadened.

MCX Crude Oil 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 Crude Oil Feb: Buy at 3610-20 for the target of 3660 and 3730 with stop loss at 3565

MCX Natural gas 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:

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Base metals intraday

Major Headline:

· Copper rose in London, extending two weeks of gains, on speculation that more snow in China will further disrupt output of industrial metals including aluminum. Lead rose to a two-month high.

· MCX Copper registered days high at Rs. 312.30 per kg, Nickel rose towards Rs. 1128 per kg , Lead Feb also followed other basemetals and registered days high near Rs. 121.30 per kg.

· Copper climbed 6.5 percent last week, the most since May, after China's worst snow storms in decades last month hampered the production and transportation of commodities. More snow and rain is expected in the next 10 days, the China Meteorological Administration said today.

· Goldman Sachs Group Inc. said it may take ``months'' for China to restart metals smelters after the severe weather. ``Such energy intensive raw material production activities are likely to be a lower priority for power restarts relative to residential or labor business activities,'' analysts including Jeffrey Currie in London, said in a report dated Feb. 8.

· Hedge-fund managers and other large speculators cut their net-short positions, or bets on price decline, in New York copper futures by 23 percent in the week ended Feb. 5, from a week ago, according to Washington-based U.S. Commodity Futures Trading Commission data.


MCX Copper 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 Copper Feb: Buy at 305-304 for the target of 309 and 313 with stop loss at 301.75

MCX Zinc 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 Zinc Feb: Buy at 95.50 for the target of 98.50 and 99.80 with stop loss at 94.60

MCX Nickel 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 Nickel Feb: Buy at 1095 for the target of 1135 and 1160 with stop loss at 1073

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 Feb:

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Bullion

Major Headline:

· MCX gold trade near all-time high Monday boosted by overseas prices, gaining for the fifth consecutive trading session, but domestic demand slackened.

· MCX Gold April registered days high near Rs. 11809, silver followed yellow metals and traded near Rs. 22174 per kg. Markets remain positive following international trend.

· Gold rose also as interest-rate cuts feed through to higher commodity prices, increasing demand for precious metals as a hedge against inflation. Platinum advanced to a record, silver climbed to a 27-year high and palladium reached the highest since September 2001.

· Group of Seven officials at a meeting in Tokyo at the weekend indicated they would lower rates further to spur economic growth. Gold has climbed 11 percent this year as the Federal Reserve reduced benchmark borrowing costs 1.25 percentage points, saying ``risks to growth remain.'' The UBS Bloomberg Constant Maturity Commodity Index has gained 8.6 percent.

· The US dollar was weaker against the yen in afternoon trade in Asia on Monday on speculation Federal Reserve Chairman Ben Bernanke will later this week reiterate that interest rates will fall further amid slowing economic growth.

· World oil prices continued higher in Asian trade on Monday while supply worries outweighed concerns about the health of the United States economy.

Indian Bullion Spot Market

Precious metals maintained its upbeat tone in spot markets on a weak dollar and supply problems. Saturday's approval by the Group of Seven rich nations for sale of gold by the International Monetary Fund (IMF) from April also failed to impact the upside.

· In Mumbai markets, gold (995) finished at Rs 11,895/10gm and gold (.999) finished at Rs 11,950/10g. Arrivals in gold were at 150 kilos and traded volumes at 100 kilos. Silver (.999) closed at Rs 21,675/kg. Arrivals in silver were at 200 kilos and traded volumes at 200 kilos.

· Chennai gold (995) and gold (.999) finished at Rs 11,870/10gm and Rs 11,920/10gm respectively whereas Silver (.999) closed at Rs 21,100/kg.

· Jaipur gold standard closed at Rs.11,950/10gm whereas Silver (.999) ends at Rs 21,500/kg.

· Ahmedabad gold (995) closed at Rs 11,890/10gm and gold (.999) at 11,950/10gm respectively whereas Silver (.999) closed at Rs 22,000/kg.

· In Delhi bullion markets, gold (995) closed at Rs.11,890/10gm and gold (.999) at Rs 11,950/10gm respectively whereas Silver (.999) ends Rs.21,400/kg.

MCX Gold (Apr)

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 Gold April: Buy at 11700-680 for the target of 11760 and 11800 with stop loss at 11650

Sell at 11810/30 for the target of 11740 and 11700 with stoploss at 11855

MCX Silver (Mar)

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 Silver March: Buy at 21960-940 for the target of 22150 and 22350/450 with stop loss at 21845

Sell at 22450/22500 for the target of 22350 and 22150 with stoploss at 22600

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Technicals – MCX (Intra day calls)

CRUDE OIL (February) BULLISH ABOVE 3746 BEARISH BELOW 3732

GOLD (April) BULLISH ABOVE 11792 BEARISH BELOW 11754

SILVER (March) BULLISH ABOVE 22341 BEARISH BELOW 22257

COPPER (February) BULLISH ABOVE 310.65 BEARISH BELOW 309.85

LEAD (February) BULLISH ABOVE 120.95 BEARISH BELOW 120.55

NICKEL (February) BULLISH ABOVE 1114.5 BEARISH BELOW 1109.5

ZINC (February) BULLISH ABOVE 98.10 BEARISH BELOW 97.70

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bullion chart

this is MCX gold intraday chart
click to view full size



this is MCX silver intraday chart
click to view full size




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outlook

April gold closed higher on Monday as it extended last Friday's rally above the 10-day moving average crossing at 916.20. The
high-range close sets the stage for a steady to higher opening on Tuesday. Stochastics and the RSI have turned bullish signaling
that sideways to higher prices are possible near-term. If March extends this week's rally, January's high crossing at 942.20 is
the next upside target. Closes below last Tuesday's low crossing at 888.40 would confirm that a short-term top has been posted.
First resistance is today's high crossing at 931.00 then January's high crossing at 942.20. First support is the 10-day moving
average crossing at 916.20. Second support is the 10-day moving average crossing at 909.40.

March silver closed higher on Monday and above the previous reaction high crossing at 17.345 thereby renewing this winter's
rally. The high-range close sets the stage for a steady to higher opening on Tuesday. Stochastics and the RSI have turned bullish
signaling that sideways to higher prices are possible near-term. If March extends this week's rally, monthly resistance crossing
at 17.870 is the next upside target. First resistance is today's high crossing at 17.595 then monthly resistance crossing at
17.870. First support is the 10-day moving average crossing at 16.851 then the 20-day moving average crossing at 16.550.

March copper closed higher for the fourth day in a row on Monday as it extended last Friday's rally above the 75% retracement
level of the October-December decline crossing at 352.60. The mid-range close sets the stage for a steady opening on Tuesday.
Stochastics and the RSI are overbought but remain bullish signaling that sideways to higher prices are possible near-term. If
March extends today's rally, the 87% retracement level crossing at 363.80 is the next upside target. Closes below the 10-day
moving average crossing at 334.63 would confirm that a short-term top has been posted. First resistance is today's high
crossing at 359.90. Second resistance is the 87% retracement level crossing at 363.80. First support is today's low crossing at
351.95. Second support is the 62% retracement level crossing at 340.77.

March crude oil closed sharply higher on Monday and closed above the previous reaction high crossing at 92.71. Today's high-
range close sets the stage for a steady to higher opening on Tuesday. Stochastics and the RSI have turned bullish signaling that
sideways to higher prices are possible near-term. If March extends today's rally, the reaction high crossing at 96.92 is the next
upside target. Closes below the 20-day moving average crossing at 90.33 would temper the near-term friendly outlook in the
market. First resistance is today's high crossing at 94.92. Second resistance is the reaction high crossing at 96.92. First support
is the 20-day moving average crossing at 90.33. Second support is last week's low crossing at 86.24.

March Henry natural gas gapped up and closed sharply higher on Monday as cold weather continues to descend across large
portions of the U.S. triggering increased heating demand. The high-range close sets the stage for a steady to higher opening on
Tuesday. Stochastics and the RSI remain bullish signaling that sideways to higher prices are possible near-term. If March
extends this week's rally, November's high crossing at 8.830 is the next upside target. Closes below today's gap crossing at
8.330 would temper the near-term friendly outlook in the market. First resistance is today's high crossing at 8.627 then
November's high crossing at 8.830. First support is today's gap crossing at 8.330. Second support is the 10-day moving
average crossing at 8.057.

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GENERAL MARKET CONDITIONS

There are a very few days when silver outperforms gold, yesterday was one of them. Silver, if it is able to hold on to current prices, should rise even faster than gold. We all know that silver rises as well as falls faster than gold. There are short positions at lower levels which are yet to be squared off. Some of the short traders have yet to square off in anticipation that comex march futures will close lower this month. However in the intermediate time if silver continues to rise, margin pressures will create short covering.

Gold and other precious metals will remain firm on lack of new sources of alternate investments (other than equities) and continued power woes in South Africa. Investment demand in precious metals will rise unless there is a stabilization factor in equities. Precious metals will remain delinked from the US dollar. However volatility will be high in precious metals as traders book profit at higher levels and new investors invest at lower levels.

SILVER -- MARCH FUTURE -- INTRA DAY PIVOT $1710.0

$1752 price target achieved. For the day if silver holds $1714 it will target $1790 and $1812. Silver has to fall below $1714 for $1688 and below.

COPPER -- MARCH FUTURE -- INTRA DAY PIVOT: $345.0

Copper has to hold $345.50 to target $364.80 and $381.50. For the week as long as copper holds $336 downside will be limited.

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