Gold and silver fell in Asia on hopes of a peace in Israel. US President Biden and his administration is trying to ask Israel to go for an all-out war. Only peace will cause a temporary sell off in gold and silver. If not then, price will be very volatile.
Overall, I am still bullish for gold and silver till Dhanteras (Hindu Festival two days before Diwali) on 10th November. Price fall upto five percent (if any) in gold and silver will be a part and parcel of the bullish trend. Short term investors need to have mark to market (MTM) margin of five percent below their buy price to avoid a stop loss trigger or avoid panic selling near the lowest price.
China copper imports
China's imports of major commodities remained resilient in September.
- For the first nine months of the year imports of unwrought copper are down 9.5%.
- China’s Copper imports were 480,426 metric tons in September, up from August's 473,330, but down 5.8% from 509,954 in September last year.
- For the first nine months of 2023, unwrought copper imports were down 9.5% to 3.99 million metric tons.
- Imports of copper ores and concentrates were up 7.8% over the same period to 20.34 million metric tons
Chinese imports numbers of metals and energies indicates that Chinese domestic economy is not as bad as markets are expected. If the September trend continues into October to December quarter, then I will suggest to look for signs of a long term bottom formation in copper and base metals. (anytime from now till middle of January).
No one is talking about the direction of base metals produced in Russia. A lot of Russian metals must be directly moving into China, India and other Asian nations. LME and LME warehouses are out of picture for Russian base metals. LME base metal stocks are on the higher side probably due to direct purchases from Russia by Asian industrial users. I do not have any concrete information on this. I am just trying to make a guess by connecting the dots.
I was told by a physical dealer in India that LME has survived all scams and competition in the past and will continue to do so. I have a doubt on this view. I believe that LME price should be used for base metal imports. Buying and selling based on local premium and adapting to the same (away from LME) will be more profitable in the long run.
Hedging and de-hedging has a cost which can be avoided through the embracing of your nations local price. Base metals hedging in India (by industrial users) is not even ten percent of its potential in my view. Policies have to be changed by the government of India and SEBI and commodity exchanges to induce industrial users to hedge. In my twenty years of experience in commodity advising, most of the industrial users have converted a hedged base metal position into a speculative transaction. Real hedging is a lot less in industrial metals in India.
Trend after 3:30 pm Indian Time (GMT+5:30) is the key.
Spot Gold (current market price $1915.30)
- Daily support: $1872.60, $1890.50, $1901.00, and $1904.00
- Daily resistance: $1934.80 and $1951.90
- Spot gold has to trade over $1916.00 today to be in an intraday bullish zone rise to $1944.20 and more.
- Mild sell off will be there if spot gold trades below $1916.00.
- Crash or sell off will be there if spot gold trades $1896 today or tomorrow.
COMEX COPPER DECEMBER 2023 (current market price $357.20)
- 50 month moving average: $363.50
- Copper December has to trade over $359.00 for the rest of October to be in a bullish zone.
- There will be sellers on rise as long as copper December trades below $359.00 to $350.10 and $345.30.
- Key long term support is between $345-$350 zone.
Disclaimer: Any opinions as to the commentary, market information, and future direction of prices of specific currencies, metals and commodities reflect the views Chintan Karnani. In no event shall Chintan Karnani have any liability for any losses incurred in connection with any decision made, action or inaction taken by any party in reliance upon the information provided in this material; or in any delays, inaccuracies, errors in, or omissions of Information. Nothing in this article is, or should be construed as, investment advice. All analyses used herein are subjective opinions of the author and should not be considered as specific investment advice. Investors/Traders must consider all relevant risk factors including their own personal financial situation before trading. Prepared by Chintan Karnani
Disclosure: I do not trade in CME futures or spot gold and spot silver. I trade in India’s MCX commodity exchange.
NOTES TO THE ABOVE REPORT
- ALL VIEWS ARE INTRADAY UNLESS OTHERWISE SPECIFIED
- PLEASE NOTE: HOLDS MEANS HOLDS ON DAILY CLOSING BASIS
- PLEASE USE APPROPRIATE STOP LOSSES ON INTRA DAY TRADES TO LIMIT LOSSES.
- THE TIME GIVEN IN THE REPORT IS THE TIME OF COMPLETION OF REPORT
- ALL PRICES/QUOTES IN THIS REPORT ARE IN US DOLLAR UNLESS OTHERWISE SPECIFED.
- ALL NEWS IS TAKEN FROM REUTERS NEWSWIRES.
- TECHNICAL ANALYSIS IS DONE FROM TRADINGVIEW SOFTWARE
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