Asian Metals Market Update for 3rd June 2024

June 03, 2024

Traders will take positions for various key US economic data releases like May jobs, May ISM numbers and 12^th June Federal Reserve meeting. One needs to look for signs of a short-term bottom in precious metals and base metals. But there will be a technical breakdown sell off and net increase in short positions IF falling trend is there for the next two weeks.

Physical buyers will be buying this week aggressively if there is a big crash. Asia’s factory manufacturing PMI expanded in May month. Japanese manufacturing expanded for the first time in a year. South Korea manufacturing expanded at fastest pace in two years in May month. China’s private Caixin factory activity expanded at the fastest pace in the last two years in May. Outlook for manufacturing in Asia is robust.

Physical demand for gold and silver in India will be very high as election results will be known this week. Price corrections from the high of May will lure more and more Indians to invest/buy gold and silver in any form. The general perception in India is that gold and silver are in a long-term bullish zone. Trend of USD/INR is controlled by the Reserve Bank of India. India’s inclusion in the JP Morgan bond Index from the last week of June will see huge inflows in India’s bond markets. It remains to be seen if the RBI will let the USD/INR appreciate versus the US dollar or continue to buy excess forex inflows and increase forex reserves.

Spot silver – intraday view (current price $30.24)

Spot silver has to trade over $29.90 to rise to $31.20 and $32.00.
Crash or sell off will be there if spot silver trades $29.90 after London silver Fix (after 3:30 pm Indian Time) to $29.62 and $29.35.

Zinc LME cash – intraday view (current price $2969.50)

50-day simple moving average: $2828.40. (this is key short-term support in case zinc plunges once again in June month).
Key price to watch today and till Wednesday: $2960.300
Zinc LME Cash. has to trade over $2930.70 today to rise to $3105.50 and more.
Another wave of sell-off will be if zinc trades below $2930.70 after LME opens and till days close.

Disclaimer

The investment ideas provided is purely independent view point and are solely for collective learning and for academic interests. There is no commercial benefit accruing or have deemed to accrue to me out of providing such investment ideas.
The investment ideas shared here cannot be construed as investment advice or so. If any reader is acting on these advices, they are requested to apply their prudence and consult their financial advisor before acting on any of the recommendations made here. I am not responsible to anybody in the event of profits and losses (if any) upon acting on such advice.
I hope that our readers are this well aware of the risk involved in trading in commodity derivative trading.

Disclosure: I trade in India's MCX commodity exchange. I have open positions in India's MCX commodity future. I do not trade in CME future or OTC spot gold and spot silver.

NOTES TO THE ABOVE REPORT