Bullion Intraday

Gold rose in Asia on speculation a slowing U.S. economy may prompt the Federal Reserve to lower borrowing costs, boosting the appeal of the precious metal as an alternative investment to the dollar.

· MCX Gold April traded near Rs. 11559 per 10 gram and MCX Silver March traded near Rs. 21865 with positive trend. Similarly International Spot gold remain above $900 dollar mark and registered days high at $907.65, Silver rose towards high of $17.23

· The US dollar weakened against the yen and the euro in Asian afternoon trade Monday as investors bet on a deeper Federal Reserve interest rate cut next month on growing pessimism about the US economy.

· Traders increased bets the Fed will cut borrowing costs further to prevent the economy from falling into a recession. Futures contracts on the Chicago Board of Trade show traders see a 34 percent chance that the Fed will lower the target lending rate by 75 basis points at its next policy meeting on March 18, up from 30 percent a week ago. The odds of a 50-basis-point cut are 66 percent.

· Platinum rose to a record in Asia on concern that supply will be limited by electricity shortages in South Africa and damage to an Anglo Platinum Ltd. smelter. Futures in Tokyo surged the daily limit.

· Electrical equipment affected by an accident at the smelter will take four to six weeks to repair, the world's biggest producer of the metal said Feb. 15, adding to investor concerns about output reliability from South Africa, which represents about 80 percent of global supply.

Indian Bullion Spot Market

Precious metals finished down in spot markets mauled by a strong dollar. There was some upside support from an upbeat crude oil and on expectations of yet another interest rate cut by the Federal Reserve.

· In Mumbai markets, gold (995) finished at Rs 11,650 per 10 gm and gold (.999) at Rs 11,705/10gm respectively. Arrivals in gold were at 100 kilos. Silver (.999) closed at Rs 21,605/kg. Arrivals in silver were at 250 kilos.

· Chennai gold (995) and gold (.999) finished at Rs 11,750/10gm and Rs 11,800/10gm respectively whereas Silver (.999) closed at Rs 21,250/kg.

· Jaipur gold standard closed at Rs 11,750/10gm whereas Silver (.999) finished at Rs 21,600/kg.

· Ahmedabad gold (995) ends at Rs 11,590/10gm and gold (.999) ends at Rs 11,649/10gm respectively whereas Silver (.999) closed at Rs 21,600/kg.

· In Delhi bullion markets, gold (995) closed at Rs 11,640/10gm and gold (.999) at Rs 11,700/10gm whereas Silver (.999) ends at Rs 21,225/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 11510-520 for the target of 11640 and 11690 with stop loss at 11485

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 21820-800 for the target of 22100 and 22350 with stop loss at 21765

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Base Metals

· Copper rose to its highest in almost four months in London as imports of the metal into China, the world's largest user, advanced to the most since April. Aluminium and zinc also climbed. MCX Copper Feb traded above Rs. 316 per kg, Zinc Feb traded near Rs. 94 per kg, Lead Feb traded near Rs. 120 per kg and Nickel Feb traded at Rs. 1094 per kg.

· Chinese imports of copper gained to 239,500 metric tons in January, 6.6 percent more than the 224,600 tons in December, the Beijing-based customs office said today.

· Gains accelerated after the LME reported copper stockpiles declined to a four-month low. They dropped 6,275 tons, or 4.2 percent, to 144,375 tons, the biggest drop since Oct. 17.

· Inventories including those monitored by the Shanghai Futures Exchange and the Comex division of the New York Mercantile Exchange, totaled 188,244 tons, the lowest since Oct. 31, 2006. That's equal to 3.7 days of global consumption, based on estimated usage of 18.74 million tons. The average was 4.9 days last year.

· China, the world's largest producer and consumer of aluminum, said that January exports of the metal fell 6.6 percent from December. It was the first monthly drop since October, according to Bloomberg data.

· Aluminum has gained 18 percent this year after power shortages in China and South Africa. The contract for delivery in three months rose $27 to $2,847 a ton on the LME.

· Zinc had a supply shortfall of 15,000 tons last year, compared with consumption of 11.41 million tons, the Lisbon-based International Lead and Zinc Study Group said today on its Web site. Lead's shortfall was 70,000 tons, compared with demand of 8.22 million tons, the group said.

· Yunnan Chihong Zinc and Germanium Co., China's fifth-largest zinc producer by capacity, cut its capacity utilization rate because of power shortages, according to Beijing Antaike Information Development Co. Chihong can produce as much as 180,000 tons of zinc a year, according to Antaike.

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: Sell at 316-317 for the target of 310 and 305 with stop loss at 319.90

MCX Zinc Feb

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: Sell at 94 for the target of 90.50 and 89 with stop loss at 94.80

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: Sell at 1110 for the target of 1080 and 1060 with stop loss at 1135

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: Buy at 117.50 for the target of 121 and 123 with stop loss at 116.20

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Technicals – MCX (Intra day calls)

CRUDE OIL (March) BULLISH ABOVE 3793 BEARISH BELOW 3775

GOLD (April) BULLISH ABOVE 11546 BEARISH BELOW 11510

SILVER (March) BULLISH ABOVE 21955 BEARISH BELOW 21876

COPPER (February) BULLISH ABOVE 314.6 BEARISH BELOW 313.6

LEAD (February) BULLISH ABOVE 120.20 BEARISH BELOW 119.70

NICKEL (February) BULLISH ABOVE 1087 BEARISH BELOW 1082

ZINC (February) BULLISH ABOVE 92.50 BEARISH BELOW 92.10

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long view (லாங் வீயு)

GOLD
LIKELY TO TEST 12000-12100 WITH ANY BREAK & CLOSE ABOVE 11810-875(APRIL)

SILVER
LIKELY TO TEST 22700-750 Max UPTO 23000 WITH ANY BREAK & CLOSE ABOVE 22425, ONLY CLOSE BELOW 21700 TEST 21400-21250 AGAIN(MAR)

CRUDE OIL
LIKELY TO TEST 3850-70-3900 WITH ANY BREAK & CLOSE ABOVE 3810, AND CLOSE ABOVE 3900-3935 RALLY TEST 4050-4100 ATLEAST(MAR)

COPPER
LIKELY TO TEST 317 UPTO 320 WITH ANY BREAK & CLOSE
ABOVE 312.5, WHILE CLOSE BELOW 302.5 TEST 297-293 ATLEAST(FEB)

LEAD
LIKELY TO TEST 130 UPTO 133 Max TO 140 WITH ANY BREAK & CLOSE ABOVE 123-125, WHILE CLOSE BELOW 116.5 TEST 113-111 ATLEAST
(FEB)

ZINC
LIKELY TO TEST 89-87 WITH ANY BREAK & CLOSE BELOW 91.5, AND CLOSE BELOW 86.5 TEST 82/78 UPTO 75, ONLY CLOSE ABOVE 99-101/104 & 106 UPRALLY AGAIN TO TEST 111-115 ATLEAST(FEB)

NICKEL
LIKELY TO TEST 1000-995 WITH ANY BREAK & CLOSE BELOW 1035-40 & CLOSE BELOW 995 TEST 950 ATLEAST, ONLY CLOSE ABOVE 1130 & 1220 UPRALLY AGAIN(FEB)

ALUMINUM
LIKELY TO TEST 117-20 UPTO 124 WITH ANY BREAK & CLOSE ABOVE 113.5, ONLY CLOSE BELOW 102 SOME DOWN SIDE AGAIN(FEB)

SPOT GOLD INTERNATIONAL LIKELY TO TEST $ 950-960 WITH ANY CLOSE ABOVE $937, AND CLOSE BELOW $ 884 SOME DOWN SIDE LIKELY

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GENERAL MARKET CONDITIONS

Copper continues to shine bright. LME inventories have been continuously falling. Expectations that China will need more copper and aluminum to repair the damaged infrastructure (ahead of the Olympics games) has resulted in greater investment interest. Copper will remain firm and could reach record highs if global inventories continue to fall and the Chinese buy at higher levels. The only negative factor for copper is reduced demand and Chinese copper supplies resuming normal operations. Higher copper prices will prevent silver and other base metals from a fall.

Gold and silver are in a consolidation phase and should break out from the current wider trading range soon. The technical picture is still bullish; however failure to break recent highs in the near term will result in a correction. A continuous rise in platinum prices and South African power woes will prevent gold from a collapse in the short term. At higher levels physical demand is virtually non existent.

SILVER -- MARCH FUTURE -- INTRA DAY PIVOT $1752.0

Silver has to break $1752 and $1770 else it will trade in $1692-$1760 wider range. Consolidated fall below $1692 will result in $1652.

COPPER -- MARCH FUTURE -- INTRA DAY PIVOT: $357.0

$368-$382 is the technical congestion zone. Failure to break $382 this month will result in fall to $336 and below.

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