18 June 2008 10:51:45
Oil prices closed modestly lower yesterday, as easing supply concerns and lower demand forecasts influenced the sentiments of traders.
Crude oil July in NYMEX settled at $133.55 yesterday, after trading in the range $135.23 - $132.00.
Expectations that Saudi Arabia, the world’s biggest oil exporter, is considering increasing its output next month have slightly eased the concerns regarding supply of oil.
Oil prices had touched a new all-time high near $140 a barrel on Monday, on reports that a fire forced Norwegian oil company StatoilHydro to halt oil production at a North Sea platform.
The oil cartel OPEC in its latest monthly oil market report released on Friday cut its estimate for 2008 global oil demand to an increase of 1.1 million barrels a day, from an increase of 1.17 million barrels projected earlier. The total global oil consumption was revised to 86.88 million barrels a day from the previous estimate of 86.95 million barrels a day.
Earlier, the International Energy Agency lowered its forecast for average global oil product demand in 2008 to 86.8 million barrels a day, down 80,000 barrels a day from its previous estimate.
According to the latest energy-outlook report from the US Energy Information Administration, global oil consumption was up a lower than expected 630,000 barrels per day during the first quarter of 2008 compared with year-ago levels, against the expected growth by 1 million barrels a day.
But the US Energy Department’s weekly inventory report last week had revealed that the nation's crude supplies dropped 4.6 million barrels to 302.2 million barrels for the week ended June 6, taking the total fall in crude inventories to 23.6 million in four weeks.
Potential supply threats due to geo-political tensions and the Atlantic hurricane season and OPEC’s unwillingness to increase output despite high prices continue to underpin oil prices.
The Atlantic hurricane season officially began on June 1st. Arthur, the first Atlantic storm of the season, made landfall on Sunday near Mexico forcing the closure of two export terminals, but afterwards weakened to a tropical depression creating heavy rains in the Gulf of Mexico.
Repeated attacks on Nigerian oil facilities sustain concerns on supply from the oil–rich Niger Delta.
Meanwhile, Iran has cut its crude oil exports by 200,000 barrels a day since February 20 due to a seasonal fall in demand for crude oil during the refinery maintenance period. Iran is the world's fourth biggest oil exporter, currently producing around 4 million barrels a day, of which roughly 2.5 million barrels a day is exported.
DWTI (July) traded in the range $135.97 - $132.80 and closed at $134.53 ($135.34).
Weekly Outlook (NYMEX Crude oil July)
Resistances are $137, $138.14 and $139.14; supports $134, $132.35, $131.30. Expecting more weakness below $132.35.
TECHNICAL OUTLOOK (Intra-day)
DGCXCrude (July) - Bullish above 134.75; bearish below 134.20
MCXARUN
9994500540
Wednesday, June 18, 2008
DGCX Gold : Recovers from early losses
18 June 2008 10:50:01
Gold pared early losses and closed relatively flat yesterday, while the dollar was pulled down by weak data from the US Housing sector.
International spot gold traded in the range $888.35 - $873.80 and last quoted at $881.90 ($881.30).
According to the release by US Commerce Department, Housing starts fell a more-than-expected 3.3% in May to a seasonally adjusted annual rate of 975,000, the lowest level since March 1991.
In another unsupportive data for the dollar, the Federal Reserve reported a 0.2 % decrease in US industrial production in May.
Dollar had eased on Monday due to profit booking, after a meeting of the Group of Eight finance ministers in Japan steered clear of the greenback's recent exchange-rate weakness issue and focused on the rise in commodity prices and the related economic risks.
The greenback had gained sharply last week supported by expectations of an interest rate hike amid rising inflation, and strong retail sales data from the US.
Data from the Labor Department showed a rise in US consumer prices at the fastest pace in six months, strengthening the growing expectations for a Federal Reserve interest-rate hike. As per the data, US consumer price index climbed 0.6% in May.
Last week, the US Commerce Department reported a 1 % rise in May retail sales, the biggest increase recorded since November, letting the US currency to add to this week’s sharp gains.
Comments from Federal Reserve Chairman Ben Bernanke last week regarding growing inflation fears, which hinted at a possible rate hike later this year, also helped the dollar to strengthen against the major currencies.
The recent data from various sectors in the US have given rather mixed hints regarding the economy.
A report from the Labor Department highlighted the pressures on the US job market. According to the report, initial jobless claims in the US increased by 25,000 to 384,000 in the week ending June 7. The four-week average of initial claims rose 2,500 from the prior week to 371,500. Continuing unemployment claims also recorded a rise of 58,000, to 3.14 million for the week ending May 31, the highest level in more than four years. The four-week average of continuing claims rose by 16,500 to 3.09 million in the latest week.
Also the US trade deficit had widened 7.8% in April to a seasonally adjusted $60.9 billion from $56.5 billion in March, according to the report by US Commerce Department on Tuesday. The growing deficit was driven by a surge in crude oil imports, which eclipsed a significant gain in the nation’s exports.
The Bureau of Labor Statistics of the US Labor Department reported a more-than-expected rise in the unemployment rate in May to 5.5%, against the expected 5.1%. The total number of unemployed persons increased by 861,000 to 8.5 million in May, after seasonal adjustment, as per the government's Household Survey Data.
According to the data released by Commerce Department, real gross domestic product of the US increased at a 0.9% annual rate in the first three months of the year, slightly faster than the previous estimate of 0.6%.
Last day DGCX Gold Aug traded in the range $890.90 – $876.70 and closed at $886.70 ($885.90).
Weekly Outlook (Spot Gold)
Resistances are $874, $884, $890, $899; supports $856, $845. Some recovery is expected above $884.60. If trades below $858, spot gold may move towards $845.
DGCX Gold August
TECHNICAL OUTLOOK (Intra-day)
GOLD (Aug) - Bullish above $ 888; bearish below $ 883
MCXARUN
9994500540
Gold pared early losses and closed relatively flat yesterday, while the dollar was pulled down by weak data from the US Housing sector.
International spot gold traded in the range $888.35 - $873.80 and last quoted at $881.90 ($881.30).
According to the release by US Commerce Department, Housing starts fell a more-than-expected 3.3% in May to a seasonally adjusted annual rate of 975,000, the lowest level since March 1991.
In another unsupportive data for the dollar, the Federal Reserve reported a 0.2 % decrease in US industrial production in May.
Dollar had eased on Monday due to profit booking, after a meeting of the Group of Eight finance ministers in Japan steered clear of the greenback's recent exchange-rate weakness issue and focused on the rise in commodity prices and the related economic risks.
The greenback had gained sharply last week supported by expectations of an interest rate hike amid rising inflation, and strong retail sales data from the US.
Data from the Labor Department showed a rise in US consumer prices at the fastest pace in six months, strengthening the growing expectations for a Federal Reserve interest-rate hike. As per the data, US consumer price index climbed 0.6% in May.
Last week, the US Commerce Department reported a 1 % rise in May retail sales, the biggest increase recorded since November, letting the US currency to add to this week’s sharp gains.
Comments from Federal Reserve Chairman Ben Bernanke last week regarding growing inflation fears, which hinted at a possible rate hike later this year, also helped the dollar to strengthen against the major currencies.
The recent data from various sectors in the US have given rather mixed hints regarding the economy.
A report from the Labor Department highlighted the pressures on the US job market. According to the report, initial jobless claims in the US increased by 25,000 to 384,000 in the week ending June 7. The four-week average of initial claims rose 2,500 from the prior week to 371,500. Continuing unemployment claims also recorded a rise of 58,000, to 3.14 million for the week ending May 31, the highest level in more than four years. The four-week average of continuing claims rose by 16,500 to 3.09 million in the latest week.
Also the US trade deficit had widened 7.8% in April to a seasonally adjusted $60.9 billion from $56.5 billion in March, according to the report by US Commerce Department on Tuesday. The growing deficit was driven by a surge in crude oil imports, which eclipsed a significant gain in the nation’s exports.
The Bureau of Labor Statistics of the US Labor Department reported a more-than-expected rise in the unemployment rate in May to 5.5%, against the expected 5.1%. The total number of unemployed persons increased by 861,000 to 8.5 million in May, after seasonal adjustment, as per the government's Household Survey Data.
According to the data released by Commerce Department, real gross domestic product of the US increased at a 0.9% annual rate in the first three months of the year, slightly faster than the previous estimate of 0.6%.
Last day DGCX Gold Aug traded in the range $890.90 – $876.70 and closed at $886.70 ($885.90).
Weekly Outlook (Spot Gold)
Resistances are $874, $884, $890, $899; supports $856, $845. Some recovery is expected above $884.60. If trades below $858, spot gold may move towards $845.
DGCX Gold August
TECHNICAL OUTLOOK (Intra-day)
GOLD (Aug) - Bullish above $ 888; bearish below $ 883
MCXARUN
9994500540
MCX Lead June traded positive following a short-covering rally at LME.
18 June 2008 09:51:31
MCX Lead June traded positive on Tuesday following a short-covering rally at LME. Lead closed near 79.85 with gains of almost 3.38% after registering days high near 80.20.Beafore market dropped to a low of 76.50 following heavy inventory data at LME.
Another massive jump in LME lead stocks is set to weigh on prices but this might be a bear trap by a player wishing to push the market down in order to buy it, says a broker. Notes material is going into warehouses but the warrants aren't being released, meaning it is tightly held and unavailable to the market.
The speculative short in LME lead has grown to record levels and with open interest at levels not seen since 2003, being short of lead has become a very "crowded" trade. Covering may prove difficult as a result.
LME stocks are up 11,550 metric tons, mainly in Dubai and Singapore, to 94,875 tons - last seen in August 06.
MCX Lead June -Technical outlook:
The daily stochastics have crossed over up which is a bullish indication. The prices closed below short term and medium term EMA, which supports bears. MACD is heading downwards in positive region, showing decrease in bullish momentum.
Technical are neutral to bearish signalling sideways to lower prices in the near term. Initial support for the market is around 77.5 levels. If broken can see further fall to 75.2 and 73.8, If market holds above 78.9 further rally can be seen towards 81.2 and 82.6
Recommendations –MCX Lead June:
will come through sms to your mobile
MCXARUN
9994500540
MCX Lead June traded positive on Tuesday following a short-covering rally at LME. Lead closed near 79.85 with gains of almost 3.38% after registering days high near 80.20.Beafore market dropped to a low of 76.50 following heavy inventory data at LME.
Another massive jump in LME lead stocks is set to weigh on prices but this might be a bear trap by a player wishing to push the market down in order to buy it, says a broker. Notes material is going into warehouses but the warrants aren't being released, meaning it is tightly held and unavailable to the market.
The speculative short in LME lead has grown to record levels and with open interest at levels not seen since 2003, being short of lead has become a very "crowded" trade. Covering may prove difficult as a result.
LME stocks are up 11,550 metric tons, mainly in Dubai and Singapore, to 94,875 tons - last seen in August 06.
MCX Lead June -Technical outlook:
The daily stochastics have crossed over up which is a bullish indication. The prices closed below short term and medium term EMA, which supports bears. MACD is heading downwards in positive region, showing decrease in bullish momentum.
Technical are neutral to bearish signalling sideways to lower prices in the near term. Initial support for the market is around 77.5 levels. If broken can see further fall to 75.2 and 73.8, If market holds above 78.9 further rally can be seen towards 81.2 and 82.6
Recommendations –MCX Lead June:
will come through sms to your mobile
MCXARUN
9994500540
MCX Zinc June trades negative following a sell in other metals
18 June 2008 09:50:43
MCX Zinc June traded negative following a sell in other metals at LME, Zinc closed near 80.05 with minor loss after registering days low near 79.60. Intra day high registered near 81.20.
LME zinc has further to fall, with a big increase in mine output facilitating strong metal production despite a small concentrate bottleneck.
Small Chinese miners are feeling the pinch from low prices, the bank notes, and the cost support level for zinc will depend on the volume of mine supply that can be removed before it begins to constrain metal output.
But given the large volume of non-Chinese mine supply about to come to market, the cost support level for zinc is still a few hundred dollars away yet.
OZ Minerals Ltd., the world's second- largest zinc mining company to be formed by Oxiana Ltd.'s takeover of Zinifex Ltd., expects prices of the metal to rebound from 2010 as supplies from mines dwindle.
Zinc inventories at LME, decreased by 175 MT to 143800 MT.
MCX Zinc June - Technical Outlook:
The daily stochastics have crossed over down which is a bearish indication. The prices closed below short term and medium term EMA, which supports bears. MACD is heading downwards in positive region, showing decrease in bullish momentum.
Technical are neutral to bearish signalling sideways to lower prices in the near term. Initial support for the market is around 79.4 levels. If broken can see further fall to 78.7 and 77.8, If market holds above 80.3 further rally can be seen towards 81.0 and 81.9
Recommendations- MCX Zinc June: Sell at 81 Target 79.60 and 78 SL 81.80
MCXARUN
9994500540
MCX Zinc June traded negative following a sell in other metals at LME, Zinc closed near 80.05 with minor loss after registering days low near 79.60. Intra day high registered near 81.20.
LME zinc has further to fall, with a big increase in mine output facilitating strong metal production despite a small concentrate bottleneck.
Small Chinese miners are feeling the pinch from low prices, the bank notes, and the cost support level for zinc will depend on the volume of mine supply that can be removed before it begins to constrain metal output.
But given the large volume of non-Chinese mine supply about to come to market, the cost support level for zinc is still a few hundred dollars away yet.
OZ Minerals Ltd., the world's second- largest zinc mining company to be formed by Oxiana Ltd.'s takeover of Zinifex Ltd., expects prices of the metal to rebound from 2010 as supplies from mines dwindle.
Zinc inventories at LME, decreased by 175 MT to 143800 MT.
MCX Zinc June - Technical Outlook:
The daily stochastics have crossed over down which is a bearish indication. The prices closed below short term and medium term EMA, which supports bears. MACD is heading downwards in positive region, showing decrease in bullish momentum.
Technical are neutral to bearish signalling sideways to lower prices in the near term. Initial support for the market is around 79.4 levels. If broken can see further fall to 78.7 and 77.8, If market holds above 80.3 further rally can be seen towards 81.0 and 81.9
Recommendations- MCX Zinc June: Sell at 81 Target 79.60 and 78 SL 81.80
MCXARUN
9994500540
nickel intraday
18 June 2008 09:49:48
MCX Nickel trades volatile on Tuesday, market registered days low near 1015 and high near 1046.50, closed at 1036 with minor gains.
LME nickel is retracing its recent gains as the market soaks up the news that production disruptions may not be as serious after all.
While BHP Billiton's (BLT.LN) closure of its Kalgoorlie smelter and associated refinery in Western Australia may have succeeded in shifting nickel's trading range. The fact that the company will have concentrates for export has dulled the impact of its initial announcement.
Nickel still needs to work off its inventory build, and this can be done only by a revival in demand, Nickel inventories at LME, increased by 42 MT to 46998 MT.
MCX Nickel June - Technical Outlook:
The daily stochastics have crossed over down which is a bullish indication. The prices closed above short term and medium term EMA, which supports bears. MACD is heading upwards in positive region, showing increase in bullish momentum.
Technical are neutral to bearish signalling sideways to lower prices in the near term. Initial support for the market is around 1019 levels. If broken can see further fall to 1001 and 987, If market holds above 1033 further rally can be seen towards 1050 and 1064
Recommendations: MCX Nickel June: Sell at 1045 Target 1020 and 1005 SL 1052
MCXARUN
9994500540
MCX Nickel trades volatile on Tuesday, market registered days low near 1015 and high near 1046.50, closed at 1036 with minor gains.
LME nickel is retracing its recent gains as the market soaks up the news that production disruptions may not be as serious after all.
While BHP Billiton's (BLT.LN) closure of its Kalgoorlie smelter and associated refinery in Western Australia may have succeeded in shifting nickel's trading range. The fact that the company will have concentrates for export has dulled the impact of its initial announcement.
Nickel still needs to work off its inventory build, and this can be done only by a revival in demand, Nickel inventories at LME, increased by 42 MT to 46998 MT.
MCX Nickel June - Technical Outlook:
The daily stochastics have crossed over down which is a bullish indication. The prices closed above short term and medium term EMA, which supports bears. MACD is heading upwards in positive region, showing increase in bullish momentum.
Technical are neutral to bearish signalling sideways to lower prices in the near term. Initial support for the market is around 1019 levels. If broken can see further fall to 1001 and 987, If market holds above 1033 further rally can be seen towards 1050 and 1064
Recommendations: MCX Nickel June: Sell at 1045 Target 1020 and 1005 SL 1052
MCXARUN
9994500540
MCX Copper fell for the first time in three sessions as sliding energy prices
18 June 2008 09:48:24
MCX Copper dropped to a low of 342.20 following heavy inventory data at LME and a fall in bullion and energy market. Copper closed at 344.45 with a loss of Rs. 1.15 per kg, registered days high near 348.25
The blockade of a highway giving access to a Southern Copper Corp. mine in Peru, a major copper producer, also pushed prices higher. But further increases in copper prices could be limited as a seasonal weakening in demand is coming.
Copper fell for the first time in three sessions as sliding energy prices curbed demand for commodities as a hedge against inflation.
Protesters in Peru battled police and blocked roads for seventh day yesterday in a bid to stop legislation that seeks to cut mining-tax income for local governments, a mining union official said. The protests have prevented workers from reaching operations owned by Southern Copper Corp.
Copper inventories at LME, increased by 1500 MT to 123550 MT.
International Analysis: A restrained demand picture is likely to hinder LME copper prices from advancing back up to $8,500 a metric ton. Expects market surpluses in '08 and '09, with next year's surplus likely to be particularly large. Traders would be very skeptical about the sustainability of the current move higher, and would not be surprised to see an eventual decline back to the mid to high $7,000/ton range.
MCX Copper June - Technical Outlook:
The daily stochastics have crossed over up which is a bullish indication. The prices closed above short term and medium term EMA, which supports bears. MACD is heading upwards in positive region, showing increase in bullish momentum.
Technical have turned neutral to bullish and market is expected to remain positive above 347.7 levels. If sustain above this level can see a rally towards 351.0 and 353.8, If market sustains below 345.0 can see a further fall towards 341.7 and 338.9
Recommendations-MCX Copper June: Buy at 344 Target 347 and 349 SL 341.50
MCXARUN
9994500540
MCX Copper dropped to a low of 342.20 following heavy inventory data at LME and a fall in bullion and energy market. Copper closed at 344.45 with a loss of Rs. 1.15 per kg, registered days high near 348.25
The blockade of a highway giving access to a Southern Copper Corp. mine in Peru, a major copper producer, also pushed prices higher. But further increases in copper prices could be limited as a seasonal weakening in demand is coming.
Copper fell for the first time in three sessions as sliding energy prices curbed demand for commodities as a hedge against inflation.
Protesters in Peru battled police and blocked roads for seventh day yesterday in a bid to stop legislation that seeks to cut mining-tax income for local governments, a mining union official said. The protests have prevented workers from reaching operations owned by Southern Copper Corp.
Copper inventories at LME, increased by 1500 MT to 123550 MT.
International Analysis: A restrained demand picture is likely to hinder LME copper prices from advancing back up to $8,500 a metric ton. Expects market surpluses in '08 and '09, with next year's surplus likely to be particularly large. Traders would be very skeptical about the sustainability of the current move higher, and would not be surprised to see an eventual decline back to the mid to high $7,000/ton range.
MCX Copper June - Technical Outlook:
The daily stochastics have crossed over up which is a bullish indication. The prices closed above short term and medium term EMA, which supports bears. MACD is heading upwards in positive region, showing increase in bullish momentum.
Technical have turned neutral to bullish and market is expected to remain positive above 347.7 levels. If sustain above this level can see a rally towards 351.0 and 353.8, If market sustains below 345.0 can see a further fall towards 341.7 and 338.9
Recommendations-MCX Copper June: Buy at 344 Target 347 and 349 SL 341.50
MCXARUN
9994500540
GENERAL MARKET CONDITIONS
Federal regulators said that they would place stricter limits on foreign exchanges that trade American oil as concerns continue to grow about the role of speculation in rising fuel prices. Some lawmakers said the move was long overdue. Under the new agreement, foreign officials also will share daily trading data with American authorities and report any violations. Previously they shared data on a weekly basis.
The U.S. commodity futures regulator said that ICE Futures Europe has agreed to make permanent position and accountability limits for some of its U.S.-traded crude contracts, subjecting itself to the same regulatory oversight as its New York based counterpart. Following intense scrutiny and censure by Congress over skyrocketing oil prices, the U.S. Commodity Futures Trading Commission also said it would require daily large trader reports, and similar position and accountability limits from other foreign exchanges. Specifically, the agreement will require trader reports on positions in the benchmark U.S. crude contract -- the West Texas Intermediate contract -- traded on the ICE Futures exchange. The contract is linked to the WTI contract on the regulated New York Mercantile Exchange. ICE has 120 days to implement the new reporting requirements.
This move by the CFTC will not slowdown the investment demand in crude oil. In the short term it may reduce the pace of gains in crude oil. The prime reason for the rise in crude oil prices and commodity prices is lack of alternate investment especially when global equity markets are on the grip of the bears. For the commodity prices to slowdown the pace of rise, new alternate investment avenues should be made available till then the rise will continue. The current commodity bull run is not a bubble. It is backed by solid fundamentals. The only thing which I am concerned about is the pace of rise. The global population is rising every second. Land area is the same, one can use it to build cities, sports and entertainment centres OR grow more crops and other essentials which reduce supply shortages. This is for the global leaders to decide. Till then one should continue to invest in commodities.
COPPER -- JULY FUTURE
Copper now targets $371 and $377 as long as $358 holds.
NYMEX CRUDE OIL -- FUTURE -- INTRA DAY PIVOT: $131.60
Only a fall below $130.65 will result in $127.60 and $121.60. On the higher side $138.10-$141.40 is the resistance zone.
MCXARUN
9994500540
The U.S. commodity futures regulator said that ICE Futures Europe has agreed to make permanent position and accountability limits for some of its U.S.-traded crude contracts, subjecting itself to the same regulatory oversight as its New York based counterpart. Following intense scrutiny and censure by Congress over skyrocketing oil prices, the U.S. Commodity Futures Trading Commission also said it would require daily large trader reports, and similar position and accountability limits from other foreign exchanges. Specifically, the agreement will require trader reports on positions in the benchmark U.S. crude contract -- the West Texas Intermediate contract -- traded on the ICE Futures exchange. The contract is linked to the WTI contract on the regulated New York Mercantile Exchange. ICE has 120 days to implement the new reporting requirements.
This move by the CFTC will not slowdown the investment demand in crude oil. In the short term it may reduce the pace of gains in crude oil. The prime reason for the rise in crude oil prices and commodity prices is lack of alternate investment especially when global equity markets are on the grip of the bears. For the commodity prices to slowdown the pace of rise, new alternate investment avenues should be made available till then the rise will continue. The current commodity bull run is not a bubble. It is backed by solid fundamentals. The only thing which I am concerned about is the pace of rise. The global population is rising every second. Land area is the same, one can use it to build cities, sports and entertainment centres OR grow more crops and other essentials which reduce supply shortages. This is for the global leaders to decide. Till then one should continue to invest in commodities.
COPPER -- JULY FUTURE
Copper now targets $371 and $377 as long as $358 holds.
NYMEX CRUDE OIL -- FUTURE -- INTRA DAY PIVOT: $131.60
Only a fall below $130.65 will result in $127.60 and $121.60. On the higher side $138.10-$141.40 is the resistance zone.
MCXARUN
9994500540
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