Flash Manufacturing PMI and Commodity Market Tips

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Mcx Gold commodity market trading slipped heavily last week where in we saw marginal recovery in prices yesterday while they trade steady as of early Asian trade today. Although the trend is still down but oversold nature of the prices is perhaps not letting prices to fall much from here. In the meanwhile, the USD index is holding tight at 84.66, neither falling much nor rising. So, we believe its good amount of short covering should have had driven prices slightly higher along with weaker equities. While, we look at the derivatives front, the trading volume and the open interests are managing higher indicating that price trend is still healthy and bearish. SPDR Holding too scaled modestly lower to fresh lows since 2008. We remain short in gold on higher levels for the day.

Global Market View: Global equities posted a negative close last day while this morning Asians are trading marginally higher and that should be possibly because of Chinese manufacturing number which came better that everyone’s expectation. HSBC/Markit Man PMI stood at 50.50, prior number was 50.20 against anticipation of a reading near 50. We believe today should be a steady day as no major heavy weight data are expected except the EU manufacturing number and US Markit manufacturing PMI followed by the Richmond Fed manufacturing index Both Gold and silver recorded high volatility yesterday with two opening lower on Monday though managed to cut losses in latter half with Gold closing 0.1percentage higher to $1218an ounce at Comex.Gold MCX in India too added 0.35percentage by closing time and Stood at Rs 26590 per 10 Gms

Mcx Silver commodity too is trading steady today most likely that yesterday’s rebound from near 4 year lows of $17.35 an ounce might be tested once again in coming sessions. Note that industrial metals too staged good recovery yesterday which too could be one of the reasons for the very strong short-covering in the commodity. For the day, we might see modest support to the commodity coming on the back of better Chinese Manufacturing PMI reading; though still note that overall trend stays down. On that front, we recommend selling the whitish metal on higher levels today. Silver December contract at Comex was a major dragger yesterday with the commodity opening lower by around 2percentage yesterday though finally marked a modest 0.35percentage closed by the end of trade. In India, Silver Dec MCX was better off as it settled lower by just 0.1percentage to Rs 39575 per Kg.

 Commodity market Tips

Sell Gold Mcx Oct below 26700 SL 26800 Tgt 26450

Sell Silver mcx Dec below 39600 SL 39950 Tgt 38900

Existing Home Sales and Commodity Intraday Tips

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Mcx Crude oil commodity market prices in the US took negative clues from the inventory data wherein the DoE said crude supplies in the US rose 3.67 million barrels, marking its biggest weekly rise in five months which was backed by increasing imports and weak refinery utilization rate. In products, gasoline inventories fell at a better rate by 1.64 million barrels though distillate stocks increase moderately. If we look at the seasonal demand pattern in the US, summer driving season has officially ended wherein months of September-October usually are the lean seasons for oil products consumption. Thus we see overall implied demand for crude remaining weaker whereas seasonal decline is witnessed in gasoline during this period. With demand likely to stay weaker in the US in near-term; refinery utilization rate to continue declining and oil production staying higher; WTI prices should continue to trade subdued. The US DoE in its report also said crude production rose by 248,000 barrels a day to 8.838 MBPD during the week ended Sept he most since March 1986.

In the bright week, we are seeing WTI trading around 0.5percentage lower at opening meanwhile other commodities like, Bullion and Base metals too scaling lower currently. We may claim expectations over poor Chinese Manufacturing gauge is taking toll over commodities whereas broadly rising USD too hurt. This morning oil is seen trading at $91 down by 0.5percentage and looks like the same scenario may prolong in today’s trade. We recommend selling from higher levels on today’s trading session.

Global Market Snapshot: Obnoxious beginning of the week that everything is red this morning. We see Asian markets trading down with expectations over poor Chinese manufacturing number, Gold and silver trading at multi-months low, oil is trading down both at Brent and WTI and finally the non-ferrous metals are also down. At 7: 15 AM IST, the markets are trading at $1209, $17.40 for gold and silver. The WTI is at $91.38 and all the metals are down by around 1percentage this morning at LME.

Mcx Natural Gas commodity market trading held a cautious to moderately selling approach in the commodity last week though our intraday views were sometimes ruined by huge fluctuations over US weather forecasts. While volatility in the short-term is seen high, prices in intraday are expected to trade weak and we recommend selling on pullbacks today. Also we feel, traders need to be cautious for next two-three days as US CPC projects developments of huge warm temperatures in much of US East, South and Central region which if continues may infuse demand for coming days. In that case, buying from lower levels can also come in over next few days.

Commodity Intraday Tips

Sell Copper mcx Nov below 417.50 SL 420.50 Tgt 413.50

Sell Crude mcx Oct below 5630 SL 5660 Tgt 5550

Leading Index and Commodity market Tips

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Mcx Gold commodity market was trading good slide in yesterday trade and likely that weakness would continue today following better equity movement in Asia today. However, note that losses especially in gold might remain minimal today as there are no major economic cues to be watched from the US whereas the Greenback has fallen at a good rate and could provide some support to the yellow metal. There are no major changes seen over physical demand side or either the ETF side though it would not be surprising for us if we see some short-covering post the commodity slipped down to fresh 8 month lows in the week. We maintain selling view for small targets today.

Gold continued its downward spiral during the week with the metal trading lower by almost all of the day before managing modest pullback toward the end of the day.

Gold Comex Dec shut shop by 0.7percentage down to $1227 per ounce while also touched a low near $1215 during the day. Subdued US housing data may have prompted buying interest from lower levels though trend still stays down.

MCX Gold October finished lower by 0.9percentage to Rs 26650 per 10 Grams with Rupee likely to put further pressure today.

Global Market Snapshot: Asian equities trade on a mixed to positive note with Japanese Nikkei scaling higher as it currency tumbled to fresh multi-year lows against the USD. Elsewhere in the US and Europe, equities closed firmly in the green tracking continued set of optimism from FED and notwithstanding the subdued housing and permits number from the US. In the global currency space, US Dollar index slipped towards 84.25 marks, a near 0.5percentage correction as GBP stepped up ahead of anticipated positive the outcome of the Scotland-Independence vote. JPY too tumbled towards a 109 level against USD.

Silver commodity market is held in sell view as yesterday though with higher equities, rising in US Dollar and weaker industrial related data from China and EU too supporting bearishness. Likewise we said yesterday, silver may get extended pressure from losses in industrial metals today and thus on one side we maintain selling stance in both bullion commodities, our preferred pick would be silver over gold. Recommend no trade on Ratio in Intraday. On our weekly Ratio buy call, traders might have made moderate profits yesterday. Recommend holding the same with reduced stop loss whereas may look to book minimum profits today as we enter the weekend.

Silver followed Gold movement though weakness in metals and its high beta pushed the commodity further lower against gold yesterday.

Comex Dec contract closed 1.15percentage higher to $18.51 an ounce while in India we saw Silver same month shutting down by 1.1percentage to Rs 40935 per Kg.

Gold and Silver Comex Spot Ratio: No trade on Ratio in Intraday. On our weekly Ratio buy call, traders might have made moderate profits yesterday. Recommend holding the same with reduced stop loss whereas may look to book minimum profits today as we enter the weekend.

Commodity market tips

Sell Gold mcx Oct below 26770 SL 26900 TP 26550

Sell Silver mcx Dec below 41100 SL  41400 TP 40650

Continuing Claims and Commodity Trading Tips

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Crude oil commodity trading  held a cautious approach yesterday wherein we advised traders to look for only momentary trades as on one side largely positive equities, cues from PBOC and OPEC supply cut comments were seen adding fresh increase in the commodity though we were expecting some weakness to be held due to negative expectations over inventory data.

As per the commodity stocks report from the DoE, crude inventories gained 3.67 million barrels against markets forecast of a fall in the range of 1.5 million, though we were anticipating as weaker reading. If we look into products gasoline stocks fell at a decent rate though could not provide any major support to prices which closed weaker by 0.5percentageyesterday. Gasoline inventories fell by 1.6 million barrels while distillate stock increased by 279,000 barrels.

As of early Asian trade, we are looking at a weaker WTI and Brent oil prices where both of them down by over 0.5percentage. For the day, weaker expectations over US housing and manufacturing related data, strong gains in US Dollar and dragging effect of the subdued US stocks report would keep the commodity under pressure wherein we recommend selling the same at the NYMEX and MCX commodity markets for small targets.

Global Market View: Dollar is turning out to be the emperor of the currency markets this year with the Index moving to multi-year highs to 84.65 marks after taking positive cues from the FOMC meeting. Euro fell whereas Japanese Yen too slid to multi-year lows. Though the US FOMC meeting outcome looked a bit hawkish at first glance, the FED continued to claim its commitment towards lower levels of interest rates for the foreseeable future and re-iterated its view over labor market wherein the same still need very good improvement over wages growth front. Asian markets are trading on a mixed to positive note following moderate positivity in US equities which closed higher.

Economic data: EU Targeted LTRO Update, US Building Permits, Housing Starts, Philly Fed Manufacturing Index and Weekly Jobless claims data

Natural gas commodity trading market prices continued to track positive short-term developments over warmer weather forecasts in the US West. We held a positive bias yesterday though today have a cautious view as the commodity may see good volatility due stocks report. Early estimates stand for a addition of around 90 BCF, similar a last week though we feel am modest chance for positivism can be there in inventory as US recorded good amount of cooler temperatures lately. For the day, we have a ranged view in the commodity. Still short-term view in the commodity still remains weak.

Commodity Trading Tips

Sell crude Sep mcx below 5755 SL 5810 TP 5680

Sell Silver Dec mcx below 41370 SL 41450 TP 40800

Crude Inventory and Commodity Market Tips

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Crude oil commodity market trading at the NYMEX advanced almost 2percentage yesterday to close firmly over the $94 per barrel mark against our view that the commodity might see bearish momentum continuing due to ease in global supplies and amidst weak demand in the US. OPEC comments of a probable supply cut in 2015 was conjugated with intraday slump in the US Dollar and rising equities which supported the uptick in oil though fundamentally, there has been no major changes seen. OPEC daily output target may fall by 500,000 barrels to 29.5 MBPD in 2015, Abdalla El-Badri said at OPEC’s secretariat in Vienna though curiously Brent November month contract did not gained much.

If we look at the API stocks data, crude stocks increased by 3.3 million barrels last week while gasoline supplies slid by 1.2 million, news reports showed. While Bloomberg survey project fall in both Crude and gasoline stocks for the DoE, there is scope of negativity which might weigh against any major gains in oil from here. However, while looking at broad market dynamics like equities, Chinese cues and moderate correction in USD; we may not see a big fall either.

Global Market View: Yesterday’s trade was filled with high volatility wherein almost all asset classes witnessed mercurial movements. The Dollar Index which is awaiting cues from the US FOMC meeting slipped during intraday trade to record its biggest fall since May month. Markets speculated that the Fed might refrain from providing any major time-line for reducing interest rates in the US and thus volatility in USD was seen. The effect was seen on US equities which advanced whereas in commodities Crude oil and Base metals seconded higher. Bullion registered decent volatility before closing little changed on a day to day comparison. In major developments from Asia, Chinese PBOC is planning to do liquidity injections by around 500 Bln Yuan ($81 Bln) into the nation’s leading banks, according to a government administrator well-known with the matter. This can also be seen as a major aspect behind positive movement in metals and energy prices yesterday.

Economic Support: EU and US CPI, Current Account, NAHB Housing Market Index and lastly but most importantly FOMC Meeting outcome which would be released post our markets closing.

Natural gas commodity trading once again advanced tracking positive developments over warmer weather forecasts in the US West and also some southern parts on the country. While the commodity is gaining for last two sessions and likely that modest positive bias might continue in today’s session as well. Nevertheless note that other weather related developments showed US Great Lakes and northeastern states will see pockets of cooler air over the next week. This might indirectly infused gradual weakening of warmer weather forecast and thus drive away near-term demand for heating which has been driving prices higher in last couple of day. We recommend buying the commodity today, though advice taking only intraday movements.

Commodity Market Tips

Sell Gold mcx Oct below 27015 SL 27110 Tgt 26900

Buy Crude mcx Sep above 5758 SL 5710 Tgt 5860

PPI Final Demand and Commodity Intraday Tips

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Crude oil commodity market prices rebounded smartly from its intraday lows wherein at one point of time, it was down around 2percentage while finally ended the session higher by around 0.7percentage to $92.90 per barrel mark. While there is no specified reason for the commodity to bounce back from its lows other than a probable technical pullback, other indicators continue to cast negative shadow over the black liquid.

We saw the US Industrial production data disappoint heavily meanwhile Chinese cues too continue to support weakness. If we look at other broad fundamental perspective, the commodity is weighed down by ease in global supplies as been the case lately wherein the impact is witnessed in both the Brent and the WTI. If we look at the initial forecasts for the inventory front, DoE data might show fall in crude stockpiles by 1.5 million barrels whereas gasoline stocks too seen falling marginally. Positive expectations over inventory may help the commodity not fall much; however weaker equities, ease in oil supplies and subdued Chinese data points would continue to hold it down. We recommend selling the commodity on pullbacks today for small profits.

Note that on a technical perspective too, prices look for some pullback initially after which we might register sell. On that note, we have bought and later sell recommendation in NYMEX markets today. AT MCX though, we advice sell at higher level. We hold our Spread strategy as recommend yesterday. Buy MCX Oct – Sell MCX Sep as weaker demand for the commodity should reduce the backwardation ahead of expiry this week.

Global Market View: Equities in the US finished on a mixed to weaker note though we saw huge slide in the Technology Index, the NASDAQ as probably traders look to book profits ahead of the crucial two day FED meeting starting today. Cautiousness prevails in the Asian equities as well wherein we are seeing moderate drop in all major indices however in currency space, the USDX was marginally lower to 84.15 levels while the Euro currency gained near a similar percentage. As stated earlier, markets focus this week would remain on the FOMC meeting wherein expectations are high that the US central bank would give a time-line for rising interest rates in the country. It is also likely to extend the cut of its bond–purchase program.

Economic Data: German and EU ZEW Economic Sentiment data along with US PPI report. Note after the disappointing IP number from US yesterday, we may see some negative surprise over PPI data.

Natural gas Commodity market climbed yesterday, extending its gains from last week. While we held a range bias in the commodity with negative bias on expectations that the commodity might look for fresh triggers over weather, extended warmer weather outlook in the USC west probably supported the commodity yesterday. While weather related changes are depicting a very high volatility in the US lately, we hold a cautious stand in the commodity though still believe, any major positivism in prices in unlikely. Intraday outlook is seen ranged.

Commodity Intraday tips

Sell crude mcx Sep below 5705 SL 5730 Tgt 5620

Sell Silver mcx Dec below 41600 SL 41850 Tgt 41300

Capacity Utilization and Commodity Trading Tips

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Crude oil commodity trading during the week, global oil prices came under huge pressure tracking developments from the IEA (International Energy Agency) which in its report said global consumption for oil is seen increasing by 1.2 MBPD to 93.8 MBPD in 2015, lower by 165,000 BPD as compared to its own forecast in the previous month. Short-term markets sentiment was further dented by comments that Q2, 2014 consumption for the commodity fell to a near a 2 and ½ year low amidst weakening demand from world’s two largest consumers EU and China. Subdued demand from these regions forced the agency to trim its demand forecast for the current and next year as well.

As per the latest developments in the fresh week, we are seeing good fall in Asian equities along with the industrial commodities which is hurting crude oil prices as well. We saw highly disappointing Chinese Industrial production data during the weekend wherein August IP which grew by just 6.9percentage. WTI oil prices have declined over a per cent today with Chinese data along with dragging concerns over ease in global oil supply taking a toll on oil prices. Last week, already we have seen a fall by around 4percentage in Brent crude and probably some of its effect too could be getting replicated into the US Crude as the WTI in electronic session is lower to by 1.2percentage while today Brent lost around 0.6percentage to trade near two year low. We may see good gap-down opening in Indian crude today, note that Rupee has depreciated in the opening and would be a critical factor to watch during the day. We recommend selling from

Global Market View: Let us begin the week with a little sanguinity to have a good day ahead. We have already seen so much of movement in the early morning. No doubt, the markets are jittery as well as in red. The Asian markets are trading in negative after the Chinese data released over the weekend showed that industrial production in the country rose at an annualized rate of 6.9percentage in August, missing estimates for a gain of 8.8percentage and sharply lower from an increase of 9percentage a month earlier. The consequences are gold and silver fell down early morning while they have revived from the lows and currently trading at $1234 and $18.64. Today would be the day when investors might be little baffled with the trading recommendation though the overall view remains down. Oil prices have declined over a percent and the base metals too have declined with an average loss of more than half per cent.

Economic data: India Trade Balance and Exports /Imports, US Manufacturing Activity in the Empire State and Industrial Production higher levels in oil for the day. However, we need to be little cautious about volatility may remain high in US session.

Natural gas commodity trading  was advancing in first half last week on anticipation of cooling demand in the US though the commodity plunged in second half following warmer weather forecasts in near–term and also appended by disappointing inventory report. US EIA showed, NG stocks jumped by 92 BCF higher than expand prior figures. Currently cooler weather has receded and is likely to be taken over by normal temperatures in East while moderately hot climate in West and North-West region. Above weather related cues may keep NG volatile in a small range. With broader view continuing to be negative side, we keep up selling bias with small possibility and profit potential for the day. Locally, Rupee movement would be watched.

Commodity Trading Tips

Sell Silver mcx Dec Below at 41650 SL 41830 Tgt 41300

Sell Crude mcx oil Sep below at 5630 SL 5665 TP 5560

Business Inventories and Commodity Intraday Trading

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Crude oil Commodity Intraday trading as per the latest developments, Asian equity markets are trading weaker post the mixed to weaker Chinese lending data which surged more than 80percentage on a Mom comparison however still stood marginally lower than expectations. Already we have seen Chinese PPI and CPI number yesterday wherein both readings disappointed heavily and also one of the major reasons behind pressure on industrial commodities lately including oil.

Looking at the oil prices, yesterday we saw US oil jumping smartly from lows which was accompanied with better volumes which increase by near 27percentage at NYMEX however OI figures are unavailable to us right now. While we check the same numbers for MCX crude, data suggests Vol increased by 13percentage though OI fell by a similar rate and thus depicting towards a probably short-covering post the huge fall in prices in last couple of days. With Brent oil continuing to trade on a weaker note, economic data from China and EU remaining subdued, we feel broad pressure on oil prices would continue.

Global Market View: We have been seeing an incredible strength in the Dollar Index, if it ends up this week (which in all probability it will) this would be its9th consecutive up week to trade higher. The USD at present is trading at 84.35; Euro tumbled to $1.2918,Japanese yen the worst hit at 107.40, pound sterling managing at $1.6234.Moving onto commodities straight, we saw carnage in the market. The entire assets under commodities declined and looks like the same scenario may continue today.

Economic data: China released its money supply number which has declined a tad especially the M1 and M2money. This indicates poor circulation of funds in the economy, prompting soon a stimulus package.

Economic data today:

Japan: Industrial production

Germany: Wholesale price index

Euro-zone: Industrial production and the employment data

India: CPI, likely to slow down a bit and the IIP number.

US: retail sales, import price index and the business inventories.

Natural gas commodity intraday trading yesterday amongst major data, the EIA data showed N for stocks for week ended Sept 5 increased higher than expected by 92 BCF as against last week’s and expected reading. Also inventories continue to increase higher than last five year average data wherein 5 Yr avg for this time of the year stands at just 60 BCF further inflicting prices. We re-iterate our stand that the commodity continues in a bearish phase owing to the fact that higher production in the US and lower demand pushes it lower. Traders note that Rupee might narrow down the short-side potential for the commodity.

Commodity Intraday Trading Tips

Sell Crude oil mcx Sep below 5680 sl 5715 Tgt 5570

Sell natural gas mcx Sep below 237 SL 240 Tgt 232

 

Initial Jobless Claims and Commodity Trading

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Gold Commodity Intraday trading has no major changes in Bullion fundamentals as markets continue to wait for fresh triggers in a week which lacks any major economic cues. We feel there is a possibility of good move in next two days as there are few economic readings from the US and also a number of US FED Managers are going to speak at different events. Hopes of earlier than estimated rise in interest rates is one of the major reasons behind continued weakness in Gold lately. While, we look at the volume and open interests along with price performance both the variables are supportive of the bearish trend so we recommend selling from higher levels. ThoughSPDR ETF holdings rose by 3MT yesterday, they largely remain unsupportive. We recommend selling from higher levels today.

Global Market View: Major global equity markets ended last day with a minute change while Asian markets are trading slightly positive today. Therefore, we may see the local unit opening higher against the USD while we believe during the day it may again depreciate a tad. From the global currency front, markets are more or less stable. The USD index is trading at 84.24, euro is at $1.2915and the pound sterling is at $1.6198.Now, we move on to commodities, both gold and silver which fell again last day are seen trading steady at $1249 and$18.96. The Oil is trading at $91.75 and the base metals are trading steady from the previous day’s close.

Gold extended another day of range bound trade in the international markets though bias remained weaker both at the Commodity and MCX. Gold Commodity Dec contract fell 0.25percentage to $1245 an ounce whereas at MCX, October expiry metal fell 0.3percentage to Rs 27180 per 10 Gms.

Economic data: German CPI at 11: 30 AM IST, US Weekly Jobless Claims numbers at 6 PM IST and the Monthly budget statement.

Silver Commodity trading has no major changes in silver commodity as also been the case with gold as stated above. We continue to hold a bearish bias in the two metals. Re-iterating our yesterday’s view silver is managing better performance than gold in last two-three days which is not significant though makes us cautious as either there is some internal positivity which is not updated in markets or otherwise we should see strong sell-off in the commodity sooner. We hold sell stance in Intra-day whereas continue to be on the sidelines on our view over Ratio.

Silver was no different in terms of intraday performance yesterday though the whitish metal continue to manage tads better performance as compared to gold, as been the case during most of this week. Commodity December Silver closed unchanged yesterday at $18.92 an ounce whereas Indian Silver for same month’s settlement too closed flat to Rs 41950 per Kg.

Commodity Trading Tips

Sell Silver mcx Dec below 42070 SL  41300 Tgt 41700

Sell Gold mcx Oct below 27280 SL  27370 Tgt – 27100

Wholesale Inventories and Commodity Trading Tips

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Crude oil Commodity market trading  as of the latest cues in Asia, WTI  adding marginally, higher by 0.2percentage currently with markets hoping that government report might show a better than expected fall in Crude stocks as also seen in the case of API reading which was released earlier this morning. Crude stocks slipped by 1.9 million barrels in the past week as per news reports suggested for the API. Today evening the more important DoE stocks data would be released wherein the markets forecasts range from a fall of about 1-1.5 million barrel. In Products though, the reading was not very positive over the movement in gasoline and distillate stocks.

Looking at the other developments, quite in the Asia region were trading weaker with average falls around 0.5percentage on backed by issues over weaker growth in China. Separately, yesterday we saw the US EIA coming out with its monthly Energy report wherein the agency reduced forecasts over demand and also trimmed prices forecasts for the Brent and the WTI for the latter half of the year. We feel that along with good drop in Brent yesterday might be one of the major reasons behind drop in WTI from its highs. We feel, all above cues would continue to weigh the commodity wherein we hold our selling view in oil for the day. Volatility may remain higher especially in the evening session due to the US DoE inventory report. Bias remains weaker today.

Economic data: India’s car sales number, Export-import data and US wholesale inventories.

Global Market View: Some of the large cap stocks posted a negative trend last day so entire US market traded down by more than half percent and the same is seen today in the Asia. However, Asian markets are at present trading down by more than a per cent. From the global currency front, euro, pound and Yen have attempted to recover a tad and currently trading marginally positive.

We now move on to commodities, gold, silver traded down but the pace of loss were very minimal. Crude oil was down with good intraday volatility and ended lower while base metals had seen a massacre bearish movement in a single day, such kind was not noticed in the recent past.

Natural gas commodity market trading as there are no major changes in market dynamics for the commodity with weather related updates too showing continued cooler temperatures in the larger part of the US. Nevertheless, cooler weather which was seen as a subdued demand indicator during the lead shifting of summer to autumn season. The same however is in last two days is being projected as the factor which might lead to better heating demand. Tough Short-term scenario still remains bearish due to persistently rising production, lower actual demand and unfavorable weather, we are getting hit due to high volatility in intraday lately. We are refraining from any recommendation in NG for the day and would await fresh cues before developing our stance.

 Commodity Trading Tips

Sell Crude oil mcx sep below 5710 sl 5740 tgt  5610

Sell Silver mcx Dec below 42340 sl 42600 tgt 41600