Commodity outlook by Tradebulls Securities: Sell copper, buy natural gas

Commodity outlook and trading ideas by Bhavik Patel - Sr. Technical Analyst (Commodities), Tradebulls:

The dollar index (DXY) this week has traded roughly in the range of 93.30-94.08. We expect Indian Rupee (INR) to trade in the range of 72.50-73.30 next week. Any correction in Indian Rupee will only come if it manages to sustain below 72.20. If USDINR breaches 73.06 in Future, we may see rapid depreciation in our currency till 73.30-73.50. INR got a small boost with a decline in US Treasury yields reducing support for the greenback. US 10 yr yield decline from 3.110 to 3.05 which has put brakes on DXY. However given the hawkish view of Fed, we expect DXY to trade above 94.50 and so we are not expecting a significant correction in our currency. Next week chances are high for RBI’s rate hike so INR may get support but as long as 72.20 is not breached, we remain convinced that USDINR will remain weak.

Sell Copper
Target: Rs 438
Stop loss: Rs 460
Copper made ‘shooting star’ candlestick pattern at 463.25 and now has retraced to 452. In last 3 trading session, Copper has made lower high which is an indication of buyers strength getting exhausted and bears trying to capture the trend. Copper has broken the last 3 trading session low which further confirms bears getting hang of the commodity. RSI_14 has also retraced from oversold territory and is now currently at 62. We expect Copper to re-test the lows of 738 where 200 DMA is placed and recommend short with a stop loss of 460.

Buy Natural Gas
Target: Rs 226
Stop loss: Rs 207
Natural Gas has made ‘hanging man’ candlestick pattern on the daily scale near 223.4 and has since retraced back to 216.40. Overall trend remains bullish but risk-reward ratio settles better near creating long position near Rs.212. On the daily scale, 20 DMA comes near 212 with previous swing high also collaborating near 212 making it important support. We would recommend creating long position near 212 with a target of 226 and stop loss below 207 on a closing basis.

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Commodity outlook by Tradebulls Securities: Buy zinc, natural gas

Commodity outlook and trading ideas by Bhavik Patel - Sr. Technical Analyst (Commodities), Tradebulls:

The dollar index is evolving in a bull channel and inside Friday’s range just above the 95.00 marks. It is trading above the 50, 100 and 200-day simple moving averages suggesting bullish momentum. Bulls could not take over the levels of 95.70 and yesterday DXY quickly dropped to the levels of 95.

Buy Zinc
Target: Rs 180
Stop loss: Rs 172
Zinc lately has started outperforming Lead and we expect the momentum to continue for a couple of more trading session. It has closed above its short-term moving average of 13 and 20. RSI_14 has started curving upwards and is near 50. Zinc had made harami candlestick pattern after fall which indicates that sellers have exhausted and buying is slowly emerging. We recommend long position with a target of 180 and stop loss of 172.

Buy Natural Gas
Target: Rs 208
Stop loss: Rs 197
There continue to be bullish and bearish factors at play in the energy commodity. Inventories are at the lowest level in years, while production is at a record high. The correction from 208 to 201 was on account of China saying that they are considering slapping a 25 percent tariff on U.S. exports of LNG to the Asian nation. 

Commodity outlook by Tradebulls Securities: Buy nickel, lead

Commodity outlook and trading ideas by Bhavik Patel - Sr. Technical Analyst (Commodities), Tradebulls:
Dollar index erased its 2 day gain and has settled lower today trading near 94.60. In spite of dollar index’s sharpest pullback after touching technical resistance mid-month at 97, Indian Rupee continues to fall against Dollar. Indian Rupee is trading at all-time low and there seems to be no respite. Spike in crude oil prices and demand for US Dollar by Indian oil importers have added extra pressure on our currency.

Buy Nickel
Target: Rs 970
Stop loss: Rs 920
Nickel is the only base metal that has failed to rally along with other base metals. Last week we saw all base metals rallying expect Nickel. The emergence of Bullish engulfing pattern on Tuesday along with price action sustaining above the midpoint of bullish engulfing pattern suggests we may see an increase in participation in Nickel. RSI_14 also is trading above 50 indicating buying momentum is picking up. We recommend long position with expected target till 970 and stop loss of 920.

Buy Lead
Target: Rs 151
Stop loss: Rs 143
Last week, we anticipated a breakout in Lead and initiated buy call. This week too we recommend a long position in Lead. Lead prices have settled above its short-term moving average of 13 and 20 after 27 June. Momentum looks strong as RSI_14 is trading above 54 and Stochastic oscillator also have generated crossover buy signal. We recommend a long position in Lead with expected upmove till 151 and stop loss of 143.