Monday, December 17, 2007

Technicals – MCX (Intra day calls)

CRUDE OIL (January) BULLISH ABOVE 3604 BEARISH BELOW 3590

GOLD (February) BULLISH ABOVE 10185 BEARISH BELOW 10150

SILVER (March) BULLISH ABOVE 18555 BEARISH BELOW 18470

COPPER (February) BULLISH ABOVE 260.10 BEARISH BELOW 258.90

LEAD (December) BULLISH ABOVE 98 BEARISH BELOW 97.60

NICKEL (December) BULLISH ABOVE 1038 BEARISH BELOW 1034

ZINC (December) BULLISH ABOVE 92.40 BEARISH BELOW 92.00

Energy


Energy


Major Headline:

Crude oil fell for a second day on concern demand will stagnate, as strengthening inflation in the U.S. may curb any further interest rate cuts.

Oil has dropped 8 percent from a record in November on signs of weakening demand. U.S. Consumer prices rose more than forecast last month, driven by higher energy costs, a government report today showed. The Federal Reserve voiced concern that inflation may gain when it cut interest rates earlier this week.

The International Energy Agency increased its estimate of 2008 world oil demand to 87.8 million barrels per day (mbd), higher than the U.S. Department of Energy's estimate of 87.2 mbd. Either way, it is going to be interesting to see how (or if?) producers keep up. February crude oil closed down .91 at $91.55 with serious concerns about a slowing U.S. economy.

While the northeastern U.S. digs out from yesterday's heavy snow, a mix of rain and snow will fall on winter wheat country in the south central plains today and eventually bring more snow to the Northeast by Sunday. February heating oil closed down 1.03 cents at $2.6009.


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 and 18 days moving average. The downside closing price reversal on the daily chart is somewhat negative. Over all technical suggest a bullish market and prices are expected to go further up.

Recommendations:

MCX Crude Oil Jan: Buy at 3560-70 for target of 3655 and 3680 with stop loss below 3535

natural gas
Technical Outlook:

Momentum studies are bearish but are now at oversold 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 and 18 days moving average. The downside closing price reversal on the daily chart is somewhat negative. Over all technical suggest a bullish market and prices are expected to go further up.

Recommendations:

MCX Natural Gas Jan: Sell at 285-290 for the target of 275 and 265 with stop loss at 310

copper,zinc,nickel,lead

Technical Outlook:

Momentum studies are 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 over bought level, which is bearish and should support lower prices. The market's short-term trend is negative as the close remains below the 18-day moving average. The upside closing price reversal on the daily chart is somewhat positive.

Recommendations:

MCX Copper Feb: Sell at 261-262 for the target of 257, 255 and 252 with stop loss at 265.50

Technical Outlook:

Momentum studies are bearish but are now at oversold 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 increasing from over sold level, which is bullish and should support higher prices. The market's short-term trend is negative as the close remains below the 18-day moving average. The upside closing price reversal on the daily chart is somewhat positive.

Recommendations:

MCX Zinc Dec : Sell at 92.60-93.00 for the target of 91 and 90.10 with stop loss at 93.80



METALS & ENERGY

December 17, 2007



Bullion

Major Headline:

Gold fell to a one-week low as a rally in the dollar eroded the appeal of the precious metal as an alternative investment. Silver also declined.

The dollar rose the most against the euro since May 2005 after reports showing higher consumer prices fueled speculation the Federal Reserve will keep interest rates steady. Gold generally moves in the opposite direction of the U.S. currency. The metal has gained 25 percent this year as the dollar dropped 8.5 percent against the euro.

The dollar has climbed against 13 of the 16 most-actively traded currencies today as speculation grew that the Fed would be less likely to cut interest rates in the face of accelerating inflation.

The consumer price index rose 0.8 percent in November, the most in more than two years, the Labor Department said today. Wholesale prices rose 3.2 percent last month, the biggest jump in 34 years, the agency said yesterday.

The Fed has lowered the overnight lending rate 1 percentage point to 4.25 percent this year. Lower rates have bolstered gold and hurt the dollar, sending the U.S. currency to $1.4967 against the euro on Nov. 23, the lowest ever. The dollar traded as high as $1.4412 today. Gold reached $848 on Nov. 7, the highest since January 1980.

MCX Gold Feb (Daily Chart)



Technical Outlook:

Momentum studies are 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 over bought level, which is bearish and should support lower prices. The market's short-term trend is negative as the close remains below the 18-day moving average. The upside closing price reversal on the daily chart is somewhat positive.

Recommendations:

MCX Gold Feb: Sell blow 10180 for the target of 10140 and 10120 with stop loss at 10222

MCX Silver Mar (Daily Chart)

Technical Outlook:

Momentum studies are 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 over bought level, which is bearish and should support lower prices. The market's short-term trend is negative as the close remains below the 18-day moving average. The upside closing price reversal on the daily chart is somewhat positive.

Recommendations:

MCX Silver March: Sell at 18550-560 for the target of 18415 and 18355 with stop loss at 18652

Base metals

Major Headline:

Copper dropped, capping a second straight weekly decline, on concern a weakening economy will shrink U.S. demand.

The Federal Reserve's moves this week to lower borrowing costs and increase liquidity in the banking system may not be enough to alleviate the credit squeeze and stimulate growth, traders said. Copper dropped 5.4 percent this week on speculation U.S. consumption will decline.

Industrial production in the U.S. rose 0.3 percent in November as factories made more cars and consumer electronics, the Fed said today. Economists expected a gain of 0.2 percent, according to the median of 78 forecasts in a Bloomberg News survey. Copper has dropped 20 percent since Oct. 1 on speculation slowing growth will shrink U.S. demand.

Hindustan Zinc Ltd., India's largest producer of the metal, cut zinc prices by 1.3 percent, to match the fall in global rates. Zinc prices were cut to 108,200 rupees ($2,747) a ton from 109,600 rupees a ton effective today. 1.7 percent, or 2,000 rupees a ton to 113,900 rupees reduced lead prices, the company said in the statement.


MCX Copper Feb (Daily Chart)



Technical Outlook:

Momentum studies are 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 over bought level, which is bearish and should support lower prices. The market's short-term trend is negative as the close remains below the 18-day moving average. The upside closing price reversal on the daily chart is somewhat positive.

Recommendations:

MCX Copper Feb: Sell at 261-262 for the target of 257, 255 and 252 with stop loss at 265.50

MCX Zinc Dec (Daily Chart)



Technical Outlook:

Momentum studies are bearish but are now at oversold 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 increasing from over sold level, which is bullish and should support higher prices. The market's short-term trend is negative as the close remains below the 18-day moving average. The upside closing price reversal on the daily chart is somewhat positive.

Recommendations:

MCX Zinc Dec : Sell at 92.60-93.00 for the target of 91 and 90.10 with stop loss at 93.80

MCX Nickel Dec (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 negative as the close remains below the 18-day moving average. The upside closing price reversal on the daily chart is somewhat positive.



Recommendations:
wait to trade

Technical Outlook:

Momentum studies are bullish and now at sold 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 increasing from over sold level, which is bullish and should support higher prices. The market's short-term trend is negative as the close remains below the 18-day moving average. The upside closing price reversal on the daily chart is somewhat positive.

Recommendations:

MCX Lead Dec: Sell at 98.20 –98.60 for the target of 96 and 94 with stop loss at 100.20

Technical Outlook:

gold

Momentum studies are 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 over bought level, which is bearish and should support lower prices. The market's short-term trend is negative as the close remains below the 18-day moving average. The upside closing price reversal on the daily chart is somewhat positive.

Recommendations:

MCX Gold Feb: Sell blow 10180 for the target of 10140 and 10120 with stop loss at 10222

silver
Technical Outlook:

Momentum studies are 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 over bought level, which is bearish and should support lower prices. The market's short-term trend is negative as the close remains below the 18-day moving average. The upside closing price reversal on the daily chart is somewhat positive.

Recommendations:

MCX Silver March: Sell at 18550-560 for the target of 18415 and 18355 with stop loss at 18652

Bullion

Gold fell to a one-week low as a rally in the dollar eroded the appeal of the precious metal as an alternative investment. Silver also declined.

The dollar rose the most against the euro since May 2005 after reports showing higher consumer prices fueled speculation the Federal Reserve will keep interest rates steady. Gold generally moves in the opposite direction of the U.S. currency. The metal has gained 25 percent this year as the dollar dropped 8.5 percent against the euro.

The dollar has climbed against 13 of the 16 most-actively traded currencies today as speculation grew that the Fed would be less likely to cut interest rates in the face of accelerating inflation.

The consumer price index rose 0.8 percent in November, the most in more than two years, the Labor Department said today. Wholesale prices rose 3.2 percent last month, the biggest jump in 34 years, the agency said yesterday.

The Fed has lowered the overnight lending rate 1 percentage point to 4.25 percent this year. Lower rates have bolstered gold and hurt the dollar, sending the U.S. currency to $1.4967 against the euro on Nov. 23, the lowest ever. The dollar traded as high as $1.4412 today. Gold reached $848 on Nov. 7, the highest since January 1980.

LONG VIEW

CRUDE OIL
LIKELY TO TEST 3350-3300 UPTO 3260 WITH ANY CLOSE BELOW 3430-3400 WHILE CLOSE ABOVE 3715/3875-3900 UPTREND AGAIN(JAN)

OUT LOOK

February gold closed lower on Friday extending Thursday's decline below the 10-day moving average crossing at 806.40. The
low-range close sets the stage for a steady to lower opening on Monday. Stochastics and the RSI are turning bearish signaling
that sideways to lower prices are possible near-term. If February extends this week's decline, November's low crossing at
780.40 is the next downside target. Closes above Wednesday's high crossing at 822.80 would renew the rally off November's
low. From a broad perspective, February gold needs to close above 855.00 or below 780.40 to confirm a breakout of the late-
fall trading range and point the direction of the next trending move. First resistance is Wednesday's high crossing at 822.80 then
the reaction high crossing at 844.20. First support is last Thursday's low crossing at 790.90 then last Monday's low crossing at
783.00.

March silver closed lower on Friday and spiked below the previous reaction low crossing at 13.960 as it extends this week's
decline. The low-range close sets the stage for a steady to lower opening on Monday. Stochastics and the RSI are turning
bearish signaling that sideways to lower prices are possible near-term. Closes below the reaction low crossing at 13.960 would
renew the decline off November's low opening the door for a possible test of October's low crossing at 13.360 later this winter.
First resistance is the 20-day moving average crossing at 14.558 then Tuesday's high crossing at 14.975. First support is
today's low crossing at 13.870 then October's low crossing at 13.360.


January crude oil closed lower on Friday as it consolidated some of Wednesday's rally. The low-range close sets the stage for a
steady to lower opening on Monday. Stochastics and the RSI remain bullish signaling that sideways to higher prices are possible
near-term. If January renews this week's rally, the reaction high crossing at .9768 is the next upside target. Closes below the 10-
day moving average crossing at 89.67 would temper the near-term friendly outlook in the market. A close below last week's low
crossing at .8582 would renew the decline off November's high. First resistance is Thursday's high crossing at 94.85. Second
resistance is the reaction high crossing at 97.68. First support is today's low crossing at 90.60 then the 10-day moving average
crossing at .8994.


January Henry natural gas closed lower on Friday and below the 10-day moving average crossing at 7.178 signaling that a
short-term top has likely been posted. The low-range close sets the stage for a steady to lower opening on Monday. Stochastics
and the RSI are turning neutral signaling that sideways to lower prices are possible near-term. If January renews the decline off
November's high, weekly support crossing at 6.801 is the next downside target. Closes above the 20-day moving average
crossing at 7.477 are needed to confirm that a short-term low has been posted. First resistance is today's high crossing at 7.207
then the 20-day moving average crossing at 7.477. First support is Today's low crossing at 7.000 then Monday's low crossing
at 6.950.