Created: Monday, 08 December 2014 12:42
Last week MCX GOLD future witnessed choppy movement in initial part of the week as India scrapped 80-20 rule in later part of the previous week which pressurized the Gold with -1.15 percent in initial part of the last week but it showed strong recovery with more than 2.5 percent gain on Monday. An unexpected step taken by India's Central Bank to ease curbs on overseas purchases instead of tightening them indicates that the government of India is more relaxed about the Current Account Deficit as lower crude oil and softer gold prices should keep the current account deficit in acceptable limits, even with some increase in the volume of gold imports.
COMEX Gold headed its biggest daily gain in more than a year in initial part of the last week. It showed gain of more than 4.5 percent on Monday due to support from that surging oil market, increased potential in Indian Imports due to relaxation on 80-20 rule and technical buy signal. Switzerland's voting against the proposal of boosting gold Reserve from central bank also played an important role to create a bullish sentiments. Gold showed consolidated movement in later part of the week ahead of mixed economical events as better than expected ISM Manufacturing PMI, ISM Non-Manufacturing PMI, on-Farm Employment Change and ADP Non-Farm Employment Change, Trade Balance are the economical events which was lower than foretasted. SPDR Gold Trust GLD, the world's largest gold-backed exchange-traded fund, said its holdings stood at 720.02 tonnes on Thursday remained unchanged from previous business day.
Silver tracked the trend of gold and witnessed bullish movement in initial part and consolidated movement in later part of the week. MCX Silver March contract consolidated in the range of 37500 -36700 in most part of the week but closed with more than 4 percent weekly gain. COMEX Silver could not sustain above the level of $16.00 in most part of the week.
Reserve Bank of India is in pace of easing restrictions of Gold imports, supply (imports) is likely to record healthy growth to meet increasing demand, as jewellers building up inventory to fuel growth and expansion plans. The relaxation of restrictions is expected to provide a fillip to the industry, which has been recording better than expected volumes. Improvement in availability of gold at low cost, gold metal loans and likely stabilization of gold prices at lower levels is expected to drive volume growth for jewellers over the medium term. India imported 102 tonnes of gold in the first half of November alone, and imports for this full year is expected in between 850 tonnes and 950 tonnes. All India Gems and Jewellery Federation (GJF) proposed unlocking of idle gold in households & trusts to reduce CAD and forming nodal ministry for representing the domestic gems & jewellery sector. GJF urge to the government to initiate the process of creating a comprehensive gold policy with the expectation of that gold supply will be better and job opportunities for craftsmen will also increase. GJF also requested to the Government to curb smuggling from neighboring countries by reducing gold import duties.
MCX Gold & Silver traded positive this week due to short covering in prices of COMEX Gold & Silver on weakening of U.S. dollar. Both Gold & Silver are consolidating on charts. MCX Gold is expected to rise and if MCX Gold sustain above 26500 and breaks the 26860 level then it can be expected to rise till the level of 27250. Similarly, MCX Silver is also looking positive on charts and if it manages to sustain above 37400 and breach the level of 37900 on the upside, then it can rise till the level of 39400.
For this week, major U.S. data Core Retail Sales, Retail Sales, Unemployment Claims, PPI and Prelim UoM Consumer Sentiment coupled with physical demand in Asian region will further provide direction to the bullion.
Created: Monday, 08 December 2014 12:40
Nifty Future after hitting all time high of 8668 last week saw some mild corrections and consolidating in a small range, but as overall breadth of the market is positive, broad based buying was seen across the board specifically led by Bank stocks edged higher on renewed buying as the Reserve Bank of India (RBI) Governor Raghuram Rajan after RBI's monetary policy review early this week indicated that monetary policy easing is likely early next year, including outside the policy review cycle, provided the current inflation momentum and changes in inflationary expectations continue and if fiscal developments are encouraging, Axis Bank, Yes Bank and heavyweight and cigarette major ITC scaled record highs and mid cap index made at all time high.
Nifty December Future gave closing at 8582.55 with the weekly marginal decline of 55.80 points.
In near term Nifty is likely to continue its uptrend with overall breadth of the market is positive and having resistance around the levels of 8750 on the upside having immediate support around the level of 8500.
The government will unveil industrial production data for October 2014 on Friday, 12 December 2014. Industrial production growth improved to 2.5% in September 2014, from a revised 0.5% growth in August 2014.
Consumer Price Index based inflation (CPI) will be released on 12 December 2014.CPI for urban and rural India eased to 5.52% in October 2014, from 6.46% in September 2014.
WPI will be unveiled on 15 December next week. WPI eased to 1.77% in October from 2.38% in September 2014.
Movement of Rupee against Dollar, trend of the global market, further reforms and policy announcement in ongoing winter session, trend in FII flow may decide market trend in near term.
BUY SBI IN NSE CASH ABOVE 321.50 WITH SL OF 314 TGT 329,335
The overall trend of the stock is bullish and is likely to move upside further with the breakout of the consolidation at the levels of 321.50. As the stock is trading above its 50 and 200 DMA it is likely to continue its bullish trend and One can expect the targets of 329 and 335 with the stop loss of 314.
BUY TORNTPOWER IN NSE CASH ABOVE 167.50 WITH SL OF 161.50 TGT 173.50,177
After showing recovery from the lower levels on daily charts , it is trading sideways. It is sustaining below the level of 167.50 with the positive bias and is trading above its 50 and 200 DMA with the RSI of 59. It is likely to move upside with the crossing of the resistance level of 167.50 and one can get the targets of 173.50 and 177 with the stop loss of 161.50.
BUY COALINDIA IN NSE CASH ABOVE 360 WITH SL OF 354 TGT 366,370
After showing a good upside move from the lower levels, the stock is trading in correction phase in short term. It is sustaining below the resistance level of 360 with the positive bias and with the breakout of this levels is likely to show recovery in near term, One can initiate the long position in the stock above the level of 360 with the stop loss of 354 and can expect the targets of 366 and 370.
BUY HDFCBANK IN NSE CASH ABOVE 945 WITH SL OF 931 TGT 960,970
The overall trend of the stock is bullish and it is accumulating above the crucial support level of 931. It is likely to move upside with the crossing of the resistance level of 945 and may continue bull run as it is sustaining above its 50 DMA. Traders can get the targets of 960 in the stock with the strict stop loss of 931.
BUY COLPAL IN NSE CASH ABOVE 1940 WITH SL OF 1899 TGT 1985,2015
The stock is trading in range from the last few trading session and is sustaining above its 50 and 200 DMA after giving breakout of continuation pattern in short term. Traders can initiate the long position in the stock above the level of 1940 for the targets of 1985, support of 1899 will act as stop loss for the stock.