From the base metals sector, the metals
ended the day on a mixed note as the economic data from China continued to
drive the market sentiment. The trade balance data from China indicated a rise
in the imports of Copper while the exports for unwrought Al and Al products
made a sharp rise, adding onto the pressure for the metal. The CPI data from
China stood better than the expected levels however the PPI continues to remain
weak raising questions over the sustainability of the recent gains in the
metals sector. For the day, we do not have much economic data and therefore
expect the metals to sway as per their respective fundamentals. Overall, we
recommend selling Nickel, Aluminum from higher levels whereas suggest buying
Copper from lower levels. In case of Lead and Zinc, we expect the metals to remain
range bound for the day.
Gold: Gold prices managed to rebound from
its support at 25400 levels yesterday. Further upside though is likely only if
prices sustain above 25625 levels today. Failure to do so will see prices slide
lower towards 25400 levels again. A decisive breakout above 25625 will see
prices move higher towards 25800 areas again.
Silver: Silver will trade with a negative bias
until prices trade below 34750 levels. A break below 34200 will open down side
targets of 34000/33900 levels. Momentum above 34750 will help the counter
rebound towards 35000 levels again.
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