Pro-Moscow separatists in eastern Ukraine ignored a public call by Russian President Vladimir Putin to postpone a referendum on self-rule, declaring they would go ahead on Sunday with a vote that could lead to war. The decision, which contradicted the conciliatory tone set by Putin just a day earlier, caused consternation in the West, which fears the referendum will tear Ukraine apart. We expect gold prices to continue in range bound to downward movement over poor demand from Asia and easing fear in Ukraine and Russia.
Over all, MCX Gold June future is in consolidation and sustaining around lower levels. For the coming week 28000/27600 will act as a major support whereas 29050/29350 will act as a major resistance level in MCX Gold June future. For the next week in MCX Gold, trader can use sell on higher level strategy, if MCX Gold June future sustains below the levels of 28450 then it could test the levels 28320/28050.
Technically, MCX Silver July futures is in consolidation and sustaining around lower levels. For the coming week 42800/44500 will act as major resistance levels where as 38900/36500 will act as major support in MCX Silver July futures. For the next week in MCX Silver futures, traders can use sell on higher level strategy, if MCX Silver July futures sustains below 41500 then it could test the levels of 40200/ 38900.
Energy: Crude Oil prices moved down nearly half a percent as easing fear in Ukraine and higher inventories pushed the prices further down. A Libyan government deal to reopen major oil ports controlled by rebels looks likely to unravel as the appointment of a new Islamist-backed prime minister fuels distrust that is eroding support for the accord. Japanese trading houses say they will push on with investments in North American shale oil and gas fields, despite write downs in the sector on low gas prices and reduced reserve estimates. We expect Crude oil prices to remain down for the week over easing fear in Russia and higher gasoline inventories.
For the coming week 5800/5600 will act as major supports levels whereas 6200/6500 will act as major resistance in MCX Crude oil May futures. For the next week, trader can use sell on higher level strategy, if MCX Crude May future sustain below 6000 levels then it could test the levels 5930/5800.
Base Metal: Copper prices moved up nearly a percent on Thursday as positive CPI data from China and positivity in Nickel prices helped pushing other base metals higher. China's consumer prices rose 1.8 percent in April from a year earlier while producer prices fell 2.0 percent. Federal Reserve Chair Janet Yellen said that a high degree of monetary accommodation remains warranted given the slack in the economy. Yellen also said the Fed expects economic growth to accelerate this year despite the slowdown in the first quarter but warned that the recent housing market slowdown "could prove more protracted than currently expected." We expect Copper prices to remain in range for the week over stronger dollar and worries over China.
Trend of MCX Copper June future is in consolidation and also sustaining in range. For the coming week, it could face major resistance of 428/440 whereas 400/389 could be a major support in MCX Copper. For the next week trader may follow buy on lower levels strategy, if MCX Copper future sustain above 413.70 levels then it could test the level of 420/428.
By Vivek Gupta, Director Research, CapitalVia Global Research Limited