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.

What makes Akshay Kumar, highest-paid Indian entertainer, a saleable brand

For an actor who famously started his working life as a waiter and a cook and whose early days in Bollywood were spent leaping mid-air, Akshay Kumar has come a long way. With $40.5 million (Rs 2.78 billion) to his name and ranked 76 in the global Forbes Top Earning 100 Celebrities 2018 list, he is the biggest celebrity brand that India has today, leaving the industry’s three Khans (Salman, Shah Rukh and Aamir) who have held sway for years, way behind.

Kumar has moved up four places from 2017 list (80) and ousted Salman Khan from the pedestal. Salman, who ranks 82 on the 2018 Forbes list, is down 11 places from 2017 (71) and Shahrukh Khan who was ranked 65 in the 2017 list is not on it this year.

Kumar made his debut in 1991, as an ‘action’ star in movies that looked for athletic prowess over acting chops. Soon however he donned a new mask, that of a comedy star and then recently, he has changed his colours yet again. Today Kumar is known for the nationalistic-patriotic roles he does, a persona he often carries into his off-screen engagements with brands.

Gold futures on BSE: Cross-delivery centres may be a challenge, say brokers

Even as the STOCK MARKET has announced its preparedness for the commodity futures play, its brokers have some concerns, especially around delivery of bullion at the centre of choice.

This means, the exchange might offer delivery of the commodity at a centre different from the one chosen by a trader in case the underlying is not available at the centre of choice. Transportation, premiums, discount, value at risk and other costs involved in the changed delivery centre are factored in the actual price payable for sellers. But BSE traders want the exchange to offer delivery of bullion at the centre of their choice.

Existing commodity exchanges take a leeway in the delivery of commodities after the expiry of a running contract. They have a number of identified delivery centres across all deliverable commodities.

The issue facing the BSE is not gold-specific; it applies to all commodities across exchanges, according to brokers. Since BSE is launching commodity business with precious metals futures, there is a scope to look at the issue afresh.

“We used to trade in bullion on commodity exchanges earlier. The exchange offered the delivery of gold to us from a remote centre. Since the transportation of gold from that centre was difficult, we accepted the delivery, assuming this would not be repeated. But, gold delivery was again offered from the same centre. After that, we stopped trading on that commodity exchange. Now, BSE needs to address the delivery problems that traders have faced on commodity exchanges,” says A P Shukla, president, Joindre Capital Services Ltd, a member of all recognised equity and commodity exchanges in India.

From on-tap availability to limit hike: 5 reasons to invest in gold bonds

The government on Friday announced several changes that would increase the attractiveness of sovereign gold bonds.

The most important change is that these bonds will now virtually be available on tap, as the issue that opened on Monday will remain open until December 27. However, the long-tenure issue will see the setting of price on a weekly basis. According to the Reserve Bank of India's (RBI's) announcement, every week, the bonds subscription will open on Monday and close on Wednesday. The price for that will be the previous last three trading days' average price for 999 purity.

The bonds sold between October 9-11 will be issued on October 16 and will get listed on stock exchanges two weeks after that. The issue that opened on Monday is priced at Rs 2,956 per gram and at Rs 2,906 per gram for online investment.

Next week, the bonds will open for subscription on October 16 and remain open until October 18. This system will continue till December 27, which is a Wednesday.

The second important change is the weekly price fixation, which would help investors to average their cost of buying.

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Market check: Buy Havells India, Tata Motors, United Spirits

Few trading ideas by Sameet Chavan, Chief Analyst- Technical & Derivatives, Angel Broking:

Nifty Outlook:
Finally, after a consolidation of nearly three to four weeks, our markets showed some encouraging movement as we saw the Nifty marching towards its record high of 10,137.85. In fact, couple of valiant attempts to traverse this hurdle was turned down. Eventually, the Nifty managed to close firmly a tad below the 10,100 mark. The kind of activity we are observing since last three days is quite obvious as traders seemed a bit unsure whether the market has that much strength to cross record highs or not. Hence, the next round of momentum in the upward direction is possible only after surpassing this hurdle. Until then we are likely to witness a similar kind of uncertainty in a range of 10,000-10,138 with slightly higher volatility. A sustainable move below the 10,000 mark would apply brakes on the recent optimism. At present, one needs to closely keep a track of these important levels on the index and meanwhile, keep focusing on individual stocks in order to obtain better trading opportunities. A prudent strategy would be to stay light on positions and should ideally be prepared with a proper exit strategy.

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Gold prices dip by Rs 100 to below Rs 31,000 mark on weak demand

Gold prices declined by Rs 100 on Friday to Rs 30,900 per 10 gram at the bullion market as demand from jewellers and retailers eased locally amid weak trend overseas.

However, silver recovered by Rs 100 to Rs 41,600 per kg on scattered enquiries from industrial units.

Traders said apart from a weak trend overseas, fall in demand from local jewellers and retailers at prevailing levels, mainly weighed on gold prices.

Globally, gold fell 0.20 per cent to $1,326.30 an ounce in Singapore.

In the national capital, gold of 99.9 and 99.5 per cent purity fell by Rs 100 each to Rs 30,900 and Rs 30,750 per 10 grams respectively. The precious metals had climbed Rs 650 on Thursday.

Sovereign, however, remained unaltered at Rs 24,700 per piece of eight gram.

On the other hand, silver ready recovered by Rs 100 to Rs 41,600 per kg, while weekly-based delivery regained the Rs 41,000-mark by rising Rs 190 to Rs 41,120 per kg.

Silver coins, however, continued to be asked at the last level of Rs 74,000 for buying and Rs 75,000 for selling of 100 pieces.

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India to import 25 tonnes of duty-free gold from South Korea: Officials

STOCK MARKET - Indian traders are likely to import 25 tonnes of gold from South Korea in July and August, taking advantage of a recent tax change that allows importers to ship in gold without paying a 10 per cent customs duty, industry officials told Reuters.

The cheap imports are putting pressure on local refiners and banks who cannot match the steep discounts being offered on bullion sales from the duty-free gold from South Korea.


"Already 12 tonnes have been landed from South Korea since the implementation of GST. By the end of this month imports could be around 25 tonnes," James Jose, secretary of the Association of Gold Refineries and Mints told Reuters.

India, the world's second biggest gold consumer after China, imposes a 10 per cent import duty on gold, but this does not apply to countries with which it has signed Free Trade Agreements (FTAs), like South Korea.

To avoid duty-free imports from those countries, India previously imposed a 12.5 percent excise duty. However, this was scrapped along with other local taxes when a Goods and Services Tax (GST) was introduced from July 1.

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Indians are stocking up on gold, jewellery demand soars 41% in Q2CY17: WGC

STOCK MARKET - India’s insatiable appetite for gold jewellery was evident once again in the second quarter of calendar year 2017 (Q2CY17). The total demand for gold jewellery surged to 126.7 tonnes, rising 41% as compared to the previous corresponding period, suggests the latest report by the World Gold Council titled ‘Gold Demand Trends Q2 2017’.

At a global level, the overall demand for gold jewellery in Q2’17 surged 8% year-on-year (y-o-y) to 480.8 tonnes, the report says.

The strong recovery, WGC believes, had been widely expected after exceptional import figures were reported, hitting an all-time high of 104.6 tonnes in May as the market stockpiled gold ahead of the goods and services tax (GST) rate announcement.

“Expecting a punitive GST rate, jewellers and consumers alike crammed their purchases into the first two months of the quarter, slowing down once the government confirmed that a 3% rate would be applied,” WGC says.

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Jewellery stocks in focus; Thangamayil Jewellery, TBZ hit 52-week high

STOCK MARKET - Shares of gems & jewellery companies  moved higher by up to 20% on BSE after Thangamayil Jewellery posted a strong set of numbers for the quarter ended June, 2017 (Q1FY18).

Besides Thangamayil Jewellery, Tribhovandas Bhimji Zaveri (TBZ), Gitanjali Gems, Tara Jewels, Rajesh Exports and Renaissance Jewellery were also up between 2% and 7% on BSE. By comparison, the S&P BSE Sensex was up 0.38% or 123 points higher at 32,351 at 12:27 pm.


Thangamayil Jewellery hit a 52-week high of Rs 347, up 20% on BSE, after the company more than doubled its net profit at Rs 9.62 crore in Q1FY18, on the back of strong volume growth. It had profit of Rs 4.51 crore in the same quarter year ago.

Net sales of the company during quarter under review increased by 50% to Rs 434 crore against Rs 289 crore in the corresponding quarter of previous fiscal.

“Volume in gold ornaments products during the quarter rose 49% to 1,241 kgs as against 832 kgs in previous year quarter. Volumes in silver products increased 34% to 5.9 tonnes from 4.4 tonnes,” Thangamayil Jewellery said in a release.

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Gold imports double to $11.25 bn in Q1 due to seasonal, festive demand

The country's gold imports more than doubled to $11.25 billion during the first quarter of this fiscal, driven by seasonal and festival demand.

Gold imports stood at $4.90 billion in April-June 2016-17, according to the data of the commerce ministry.

Increase in the imports influences India's current account deficit (CAD).

In June this year, the imports of the precious metal had risen to $2.45 billion from $1.20 billion in the same month previous year.

Surge in gold imports in June contributed to the widening of trade deficit to $12.96 billion as against $8.11 in June 2016.

Silver imports in June, however, dipped by 28.6 per cent to $178 million.

India is the world's second biggest gold consumer after China. The imports mainly take care of demand by the jewellery industry.

At present, gold import attracts 10 per cent duty. The gems and jewellery industry along with the commerce ministry have time and again urged the finance ministry to consider a cut in the import duty.

During April to December period of last fiscal ended March 31, the current account deficit halved to 0.7 per cent, from 1.4 per cent a year ago.

The surge in gold imports in June is on account of low base effect.

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Demonetisation: As Indian tourists stay home, Dubai's gold trade suffers

Breaking News - Demonetisation's impact has travelled all the way to Dubai as Indian tourists are avoiding foreign tours since November. Among popular destinations, Dubai has been one of the easiest, nearest and cheapest. The immediate casualty has been gold demand in Dubai by Indian tourists.

Dubai’s famous Gold Souq, a prime market for the yellow metal and similar to India's Zaveri Bazar in Mumbai or Manek Chok in Ahmedabad, which houses many prominent wholesale and retail jewellers, has seen a plunge in gold jewellery demand from Indian tourists. 

Demonetisation - Buying jewellery from Dubai was lucrative for Indian tourists due to the trustworthy purity of gold and ease of using unaccounted money by buying Dubai's currency, the Dirham, with some premium in the hawala market. Further, Customs duty of 10 per cent can be avoided when reasonable jewellery is worn by tourists. 

A Dubai-based jeweller, who runs a chain of jewellery shop including a show room in Dubai's gold souq, said on the condition of anonymity that "Indian tourists' share in Dubai gold demand is around 15-20 per cent and that has been affected." He said that the overall flow of Indian tourists has come down in Dubai. Other than jewellery, electronic gadgets like costly cell phones, laptops and DSLR cameras etc are the other items on an Indian tourist's shopping list in Dubai.(Read More)