As bears returned to the equity market on Wednesday, with Asian shares retreating on coronavirus resurgence and fading US stimulus hopes, commodities showed mixed reaction. Crude oil prices may maintain the upper trading range amid expectations of a bullish weekly inventory data. Here is a look at how different commodities are behaving in today’s market.

Bullion prices traded higher on Wednesday as COMEX spot gold prices went above $1,900 per ounce, while spot silver prices at COMEX ended half a per cent up for the day. Bullion is awaiting fresh triggers as prices are trading in the range of $1,880-$1,920 due to dollar fluctuations over US stimulus worries and concerns over surge in virus cases. ETF holdings at SPDR gold shares continued to surge at 1,277.94 tonnes on Wednesday amid growing market uncertainties. COMEX gold has an important resistance at $1,940 for resumption of a bullish trend. We expect bullion prices to trade in the current range with a bearish bias for the day.

Trading Strategy:
Sell on the rise is advisable for the day at around Rs 50,550 with:

MCX Gold December

MCX Silver December

Outlook: Crude Oil
Crude oil prices resumed an uptrend with benchmark WTI crude oil rallying by 2 per cent to $41 on Wednesday. Crude oil prices gained due to a weaker dollar and a fall in weekly inventories. API report showed that US crude oil inventories fell by 5.42 million barrels last week. Crude oil prices may maintain the upper trading range amid expectations of a bullish weekly inventory data in the evening session. However, demand growth is a constant concern for oil price recovery as surge in COVID-19 infections in Europe and the US has dampened hopes of a recovery in fuel demand.

Trading Strategy:
We recommend buy on dips at around Rs 2,980 with:

MCX Crude Oil October


Outlook: Base Metals
Base metals witnessed mixed trade on Wednesday with Lead and Nickel prices gaining the most, while Zinc traded weak for the day. Copper prices kept trading steadily on mixed global cues as top miners were in discussion to avoid a strike at Chile. A strike and protests at Lundin’s Candelaria operations have severely disrupted production by around 5 per cent at the Chilean copper mine, according to a union boss.

Trading Strategy:
We expect Copper prices to trade sideways to down for the day with:

MCX Copper October

MCX Zinc October