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Commodity Research Report Ways2Capital 18 Dec 2017



Gold prices clung to earlier gains and were poised for their first weekly gain in four weeks on Friday, withstanding pressure from strong equities markets on continued support from this week's interest rate rise by the Federal Reserve. Higher interest rates usually push gold lower because they raise bond yields, reducing the appeal of non-yielding bullion, and boost the dollar, making gold more expensive for holders of other currencies. But markets had priced in Wednesday's rise and the dollar and bond yields fell after the Fed kept its outlook for three rate rises next year unchanged and said proposed U.S. tax cuts would not significantly spur growth. U.S. inflation remained weak, which Chicago Fed President Charles Evans said on Friday undermined the case for rate rises. The dollar recouped some losses as Republican senators worked to resolve disagreements on the tax reform. Major stock indexes hit record highs.

? BASE METAL
Among base metals complex, LME Nickel prices traded higher on Monday after the Chinese government slashed the export duties over some steel products which would in return increase demand for the metal. China will cut export taxes on some steel products and fertilisers and ditch those for sales abroad of steel wire, rod and bars from Jan. 1, the Ministry of Finance said on Friday. Recently, INSG report showed the widening of deficit in global nickel market to 65,700 tonnes in the first nine months of the year, from 47,400 tonnes, in the same period of 2016. As per CFTC, Hedge funds and money managers cut their net long position in COMEX copper contracts in the week to Dec. 12. However in Zinc due to ample availability of supply spread between cash & 3 month forward contract has fallen to zero from above $90/ton in October which was the highest since Dec 2006. Aluminum was getting a second boost from separate China data showing production for November slumped to 2.35 million tonnes, which was down 7.7 percent from October and the lowest absolute level since February this year. Copper prices scaled three-week highs on Friday after the New York open and as expectations of strong demand in top consumer China were reinforced by data showing firm industrial activity. Traders said rising stock market indices on Wall Street had boosted sentiment and sparked a wave of buying on industrial metals markets


? ENERGY
Crude oil prices hovered near to Friday’s levels as lack of new price driver casts the shadow over the prices. On Friday, baker Hughes showed the decline in US active rig by 4 to 747 for the first time in six weeks. In the major development in OPEC nations, Nigeria’s PENGASSAN union has threatened to go on strike from Monday after talks aimed at resolving a dispute with domestic oil and gas companies reached a deadlock. In Nigeria, Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN), which mainly works in the upstream oil industry, is clashing with the companies over the laying off of union members. And has threatened os Saturday to go on strike from Monday. Separately, Forties pipeline pipeline, which carries about a one fourth of all North Sea crude output and about one third of Britain's offshore gas production, has been closed since last week, following the discovery of a small crack in part of the system onshore in Scotland. As per CFTC data, the speculator group cut its combined futures and options position in New York and London by 7,542 contracts to 435,200 during the period. The group cut its gross long positions to 435,764 from 439,751. The group cut its short positions to 44,890 from 47,320.
NG prices remained negative on Friday as prices went lower around 2.68% in International markets and went down by 3.3% at its closing in MCX futures market. ? As per CFTC, U.S. gas speculators cut their net long positions to the least since August 2016 on expectations supplies will be adequate this winter with storage near normal levels, output at record highs and warmer than seasonal winter forecasts.



MCX TECHNICAL VIEW
? LEAD
MCX LEAD has forming head & shoulder pattern breakout which suggests positive trend for the short term. Above the level of 163.30 Price expected to provide fuel to the rally going ahead. Daily RSI (14) has given a trendline breakout which indicates change in momentum. Daily MACD has entered in a bullish crossover. Based on the above analysis, we expect a smart rally in the MCX LEAD price over the short period of time.
BUY LEAD DEC ABOVE 163.30 TGT 163.30 SL 161.5


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News Release: Commodity Research Report Ways2Capital 18 Dec 2017
Submitted on: December 18, 2017 10:15:51 AM
Submitted by: Vijay
On behalf of: www.ways2capital.com
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