Technicals – MCX (Intra day calls)

CRUDE OIL (February) BULLISH ABOVE 3545BEARISH BELOW 3514

GOLD (April) BULLISH ABOVE 11510 BEARISH BELOW 11474

SILVER (March) BULLISH ABOVE 21466 BEARISH BELOW 21375

COPPER (February) BULLISH ABOVE 287.30 BEARISH BELOW 286.50

LEAD (February) BULLISH ABOVE 111.7 BEARISH BELOW 111.3

NICKEL (February) BULLISH ABOVE 1084 BEARISH BELOW 1080

ZINC (February) BULLISH ABOVE 98.10BEARISH BELOW 97.70

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outlook

April gold closed lower on Monday and below the 10-day moving average crossing at 915.00 signaling that a short-term top has
been posted. The mid-range close sets the stage for a steady opening on Tuesday. Stochastics and the RSI have turned bearish
signaling that sideways to lower prices are possible near-term. Closes below the 20-day moving average crossing at 904.00
would confirm that a short-term top has been posted. If March extends this winter's rally, monthly resistance crossing at 950.00
is the next upside target. First resistance is last Wednesday's high crossing at 942.20 then monthly resistance crossing at
950.00. First support is today's low crossing at 896.00 then the reaction low crossing at 855.00.

March silver closed lower on Monday as it consolidated some of this winter's rally. The mid-range close sets the stage for a
steady opening on Tuesday. Stochastics and the RSI are overbought and are turning bearish signaling that a short-term top
might be in or is near. Closes below the 20-day moving average crossing at 16.312 are needed to confirm that a short-term top
has been posted. If March extends the rally off December's low, weekly resistance crossing at 17.500 is the next upside target.
First resistance is last Friday's high crossing at 17.345 then month resistance crossing at 17.500. First support is today's low
crossing at 16.445 then the 20-day moving average crossing at 16.312.

March copper closed higher on Monday as it consolidates above the 20-day moving average. 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 last week's rally, the reaction high crossing at 336.00 is the next upside target. First
resistance is last Friday's high crossing at 334.20. Second resistance is the reaction high crossing at 336.00. First support is last
Thursday's low crossing at 319.90. Second support is last Monday's low crossing at 311.65.

March crude oil closed higher on Monday and above the 10-day moving average crossing at 90.25. Today's high-range close
sets the stage for a steady to higher opening on Tuesday. Stochastics and the RSI remain neutral to bullish signaling that
sideways to higher prices are possible near-term. Closes above the 20-day moving average crossing at 91.48 are needed to
confirm that a short-term low has been posted. If March renews last Friday's decline, January's low crossing at 85.42 is the
next downside target. First resistance is the 20-day moving average crossing at 91.48. Second resistance is last Wednesday's
high crossing at 92.71. First support is today's low crossing at 88.07. Second support is January's low crossing at 85.42.

March Henry natural gas posted an upside reversal and closed sharply higher on Monday. The high-range close sets the stage
for a steady to higher opening on Tuesday. Stochastics and the RSI are neutral to bearish signaling that sideways to lower prices
are possible near-term. If March extends the decline, January's low crossing at 7.534 is the next downside target. Closes above
last week's high crossing at 8.123 are needed to renew the rally off January's low. First resistance is today's high crossing at
8.011 then last week's high crossing at 8.123. First support is today's low crossing at 7.580. Second support is January's low
crossing at 7.534.

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GENERAL MARKET CONDITIONS

It’s a technical trade in all metals and energies in the absence of major market moving news. Gold and silver will continue to find buyers at lower levels unless there is a short term technical breakdown. Some of the retail investors who are stuck at higher levels will average out at lower levels. For the rest of the week gold will consolidate before the next move. Physical demand is still not there in India. Investment demand will continue to dictate gold and silver. Based metals will find buyers at lower levels as markets prepare for greater Chinese demand after the Chinese New Year celebrations are over.

President George W. Bush’s $3.1 trillion federal budget that trims Medicare and health care programs and boosts military spending projects the deficit this year and next will hit near-record levels. If the spending does not reverse the growth rates of the US economy, the US dollar could again nosedive. This is an election year in the US and all the politicians in the US try to ensure that a temporary feel good factor is there among the voters.

GOLD -- APRIL FUTURE -- INTRA DAY PIVOT:$919.0

Gold has to break $919 for gains else it will trade in $895-$919 wider range.

NYMEX CRUDE OIL -- FUTURE -- INTRA DAY PIVOT: $89.54

In the short term as long as crude oil holds $85 it will target $95 and $102+. Crude oil has to fall below $85 for further gains.

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Stock2Watch

Stock2Watch at Open :- Indian shares are seen volatile today in the absence of strong cues from global markets, while investors are likely to watch new share offerings and listings. ** Motorcycle maker Hero Honda Moters Ltd, after its quarterly net profit rose 32% ** Tata Motors Ltd after its quarterly net profit fell 3% ** Mobile operator Reliance Communications Ltd, which plans to spend about $6 billion in the year to 2009 to expand its wireless network. **Optical storage maker Moser Baer India Ltd, after it reported net loss for the December quarter from a profit a year ago. ** Steel and real estate firm Shree Precoated Steel Ltd, after its board approved splitting each share into five and spinning of its steel business.

OUT LOOK

April gold posted an inside day with a higher close on Thursday as it consolidates above the previous reaction high crossing at
922.50. The high-range close sets the stage for a steady to higher opening on Friday. Stochastics and the RSI are overbought
but remain neutral to bullish signaling that additional gains are possible near-term. If March extends this winter's rally, monthly
resistance crossing at 950.00 is the next upside target. Closes below the 20-day moving average crossing at 900.60 would
confirm that a short-term top has been posted. First resistance is Wednesday's high crossing at 942.20 then monthly resistance
crossing at 950.00. First support is the 10-day moving average crossing at 910.60 then the 20-day moving average crossing at
900.60.

March silver closed higher on Friday as it extended this week's rally above the previous reaction high crossing at 16.715. The
high-range close sets the stage for a steady to higher opening on Friday. Stochastics and the RSI are overbought but remain
neutral to bullish signaling that sideways to higher prices are possible near-term. If March extends the rally off December's low,
weekly resistance crossing at 17.500 is the next upside target. Closes below the 20-day moving average crossing at 16.180 are
needed to confirm that a short-term top has been posted. First resistance is today's high crossing at 17.090 then month
resistance crossing at 17.500. First support is the 10-day moving average crossing at 16.443 then the 20-day moving average
crossing at 16.180.

March copper closed higher on Thursday as it extended Tuesday's rally above the 20-day moving average. The high-range close
sets the stage for a steady to higher opening on Friday. Stochastics and the RSI are bullish signaling that sideways to higher
prices are possible near-term. If March extends this week's rally, the reaction high crossing at 336.00 is the next upside target.
First resistance is today's high crossing at 332.25. Second resistance is the reaction high crossing at 336.00. First support is
today's low crossing at 319.90. Second support is Monday's low crossing at 311.65.

March crude oil closed lower on Thursday as it consolidated some of the rally off last week's low. The high-range close sets the
stage for a steady to higher opening on Friday. Stochastics and the RSI remain bullish signaling that sideways to higher prices
are possible near-term. Closes above the 20-day moving average crossing at 92.32 are needed to confirm that a short-term low
has been posted. If March renews this month's decline, December's low crossing at 85.37 is the next downside target. First
resistance is the 20-day moving average crossing at 92.32. Second resistance is Wednesday's high crossing at 92.71. First
support is the 10-day moving average crossing at 90.22. Second support is Monday's low crossing at 88.78.

March Henry natural gas closed higher on Thursday as it extends this week's breakout above the 20-day moving average
crossing at 7.966. The high-range close sets the stage for a steady to higher opening on Friday. Stochastics and the RSI are
neutral to bullish signaling that sideways to higher prices are possible near-term. If March extends the rally off last week's low,
this month's high crossing at 8.397 is the next upside target. Closes below last week's low crossing at 7.534 would renew the
decline off this month's high. First resistance is today's high crossing at 8.130 then this month's high crossing at 8.397. First
support is Tuesday's low crossing at 7.848. Second support is last week's low crossing at 7.534.

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GENERAL MARKET CONDITIONS

For once silver, copper and other base metals outperformed yesterday on expectations that the Fed interest rate cut will result in continued higher investment demand apart from lingering production issues from China. Technically the picture in zinc, lead and copper is fairly bullish and if they close higher today one should expect eight percent to ten percent gains in these metals next week. In base metals there are still short positions which are yet to be covered and if they continue to rise some of the short positions will get converted into long positions and further boost to the prices. Today’s close is very important for all the base metals.

The only risk for lower gold prices is that of stronger than expected US January payrolls over 150,000 which could result in expectations that the Fed may not cut interest rates in March. Gold is firm and will continue to find buyers on dips unless there is a technical breakdown. Silver has finally started firing and hopefully February should be the beginning of the bull run and silver gets its due. Crude will track the US dollar.

SILVER -- MARCH FUTURE -- INTRA DAY PIVOT $1692.0

Silver should target $1712 and 1760 as long as $1682 holds. A fall below $1682 will result in $1652 and $1612.0

NYMEX CRUDE OIL -- FUTURE -- INTRA DAY PIVOT: $89.54

In the short term as long as crude oil holds $85 it will target $95 and $102+. Crude oil has to fall below $85 for further gains.

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energy

MCX Crude oil Feb rose to high of Rs. 3608 per barrel and traded with reasonable gains following trend from Gold and equity market. MCX Natural gas was trading with loss of Rs.3 at Rs. 311.50

· Crude oil rose for a fourth day on speculation the U.S. Federal Reserve will cut interest rates to spur economic growth in the world's largest energy user and as OPEC prepares to keep output on hold.

· The threat of tumbling stock and home values and a weakening labor market will spur the Fed to cut its benchmark rate by half a percentage point tomorrow, traders and economists forecast. The Organization of Petroleum Exporting Countries is unlikely to change its output when it meets Feb. 1 in Vienna

· Some OPEC members, including Iran's Governor Hossein Kazempour Ardebili, have said the group is unlikely to raise output because there are sufficient supplies in the market and signs of a global economic slowdown mean demand may fall.

· U.S. economic growth probably slowed to 1.2 percent in the fourth quarter as high fuel costs and rising unemployment limited consumer spending, according to a survey of economists. Asian stocks fell for the first time in four days after Goldman Sachs Group Inc. said the Japanese economy has probably fallen into a recession.

· While temperatures are expected to be warm earlier this week, forecasts released Friday called for colder weather during the 6-to 10-day period in the U.S. Northeast and Midwest which could give a boost to heating demand. According to forecast by AccuWeather.com, as reported by Dow Jones newswires, temperatures are expected to drop into the single digits in New York this weekend and remain in the teens and 20s Fahrenheit during the first week of February.

MCX Crude Oil 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 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 Crude Oil Feb: Buy at 3560-3570 for the target of 3660 and 3695 with stop loss at 3520



MCX Natural gas Feb (Daily Chart)



Technical Outlook:

Momentum studies are still 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 Natural Gas Feb:

sell @ 313/314 stoploss 318 tgt-310-307-304

MCXARUN
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