Base metals intraday

· Basemetals moved up on Multi Commodity Exchange (MCX) on fund buying and gaining strength from robust gold and oil. MCX Copper most active February is currently trading at Rs 334.40/kg, up by Rs 8.40/kg. It tossed in the range Rs 327.30-336/kg. Nickel february contract traded at Rs 1149/kg, rising by Rs 32/kg. Zinc most active February contract is currently trading at Rs 100.10/kg, up by Rs 4.10/kg.

· On Shanghai Futures Exchange (SHFE), copper most active May contract settled at CNY67,110/tonne, up CNY440/tonne, registering gains for the fourth straight day in a row.

· Zinc prices surged in Asia on speculation supply may lag behind demand after China's worst snowstorms in decades reduced output in the world's largest producer of the metal.

· Output cuts at smelters, including the country's largest producer Zhuzhou Smelter Group Co., have driven zinc prices up 11 percent in the past month. Yunnan Luoping Zinc & Electricity Co. cut output since Jan. 29 because of power shortages, the Yunnan province-based company said today. Yunnan Chihong Zinc and Germanium Co. said yesterday it has reduced output since Feb. 11.

· Western Mining Co., which mines zinc, lead and copper inChina, plans to buy 93 million yuan worth of zinc and indium ingots from a smelter inChina'sQinghai province to meet deliveries. The company will buy 3,800 tons of zinc and 5,618 kilograms of indium ingots from Qinghai Summit Zinc Co., the China Securities Journal reported Feb. 18.

· LME-monitored inventories fell 2,250 tons to 135,375 tons, the lowest since Oct. 10. They have declined 31 percent this year. Including those tracked by the Shanghai Futures Exchange and the Comex division of the New York Mercantile Exchange, they were at 179,244 tons, a level last seen October 2006. They averaged 3.5 days of global consumption, compared with last year's 4.9 days average

· Copper was in deficit by 161,000 tons in 2007, a swing from a surplus of 278,000 tons, according to data released yesterday by the World Bureau of Metal Statistics. Demand in China, the world's largest user, increased to 4.861 million tons, 35 percent more than a year ago, the Ware, England-based group said.

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 328 for the target of 336 and 339 with stop loss at 325.50

MCX Zinc Feb (Daily Chart)



Technical Outlook:

Momentum studies are still bearish but are now at oversold levels and will tend to support reversal action if it occurs. The daily stochastics have crossed over down which is a bearish indication. The stochastics indicators are decreasing from overbought level, which is bearish and should support lower prices. The market's short-term trend is negative as the close remains below the 9-day moving average. The upside closing price reversal on the daily chart is somewhat positive.

Recommendations:

MCX Zinc Feb:

MCX Nickel Feb (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 moving average. The downside closing price reversal on the daily chart is somewhat negative.

Recommendations:

MCX Nickel Feb: Buy at 1125-30 for the target of 1165 and 1175 with stop loss at 1113

MCX Lead Feb (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 moving average. The downside closing price reversal on the daily chart is somewhat negative.

Recommendations:

MCX Lead Feb: Buy at 130 for the target of 135 and 139 with stop loss at 127.05

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