Technical View: Gold Outlook Weak; Faces Resistance At $1,113/oz

COMEX Spot Gold CMP:  $1,101/oz
Strategy: Sell @ 1,101 (CMP) | Stop @ 1,113| Target @ 1,050—976—948
Reversal Buy Above 1,113 | Stop @ 1095 | Target @ 1130 - 1151 - 1183

The technical chart indicates that gold is in a downtrend and the yellow metal is likely to remain under pressure if prices fail to cross the resistance level of 1,113 on the higher side on daily closing bases. COMEX Spot Gold is currently quoting at $1,101/oz.

Gold declined from high of 1,183 (Point A) in October 2015 to test the low of 1,046 (Point B) in December last year. Thereafter, gold witnessed a consolidation phase, with prices moving in a range of 1,046 and 1,080.

The immediate support for gold is seen at 1,050 and if it breaks this level then prices would weaken further.

According to the technical chart, the difference between Point A and Point B is 137 points and considering 100% of this difference from 1,113 (Point C), the downside target comes to 976.

A fall below this level may take prices down further to 948 levels, which is 121% of the difference between Point A and Point B.

Gold’s downtrend remains intact unless prices cross the resistance level of 1,113.

However, if gold reverts from the current level and crosses the resistance level then prices may rise towards 1,130-1,151 levels, which are 61.8% and 76.8% retracement of Point A to Point B, respectively.

Zinc Chart

WTI Crude Oil: Downtrend Likely To Continue

WTI Crude Oil (Nymex) CMP:  $36.20/bbl
Strategy: Sell @ 33 (CMP) | Stop @ 38.5| Target @ 26.9 — 25 — 21.4WTI Crude Oil technical chart indicates that prices will continue to decline in the coming sessions if it fails to cross the resistance level of 38.5 on daily closing basis. It is currently quoting at $33/bbl, below the previous bottom of 34.5 (Point Y).

The Long term chart shows formation of A-B-C Pattern with wave C in continuation, Where as the short term chart is forming Rising Wedge Pattern continuation, trading below the breakdown level of 35.9 which indicates correction in prices to continue.

WTI Crude Oil fell from 43.5 (Point X) in November end to the low of 34.5 (Point Y) in Mid December last year. Thereafter, prices went in to consolidation phase and retraced over 50% of the fall from Point X to Point Y and touched 38.38 on the higher side, before resumption of downtrend.

WTI Crude Oil is expected to decline further from the current levels if it sustain below the level of 36.

The difference between Point X and Point Y comes to 9 points. Considering 100% of this difference from breakdown point Z @ 35.9, the downside target comes to 26.9 level. Thereafter, the next target could be 25 and 21.4, which are 121 and 161% of the same difference.

However, if WTI Crude Oil reverts from the current level and crosses the resistance of 40 daily on closing basis then prices may rise towards 51 level. 

WTI CRUDE OIL - Strategy: Sell @ 33 (CMP) | Stop @ 38.5| Target @ 26.9 — 25 — 21.4

WTI Crude Oil (Nymex) CMP:  $36.20/bbl
WTI Crude Oil: Downtrend Likely To Continue

WTI Crude Oil technical chart indicates that prices will continue to decline in the coming sessions if it fails to cross the resistance level of 38.5 on daily closing basis. It is currently quoting at $33/bbl, below the previous bottom of 34.5 (Point Y).

The Long term chart shows formation of A-B-C Pattern with wave C in continuation, Where as the short term chart is forming Rising Wedge Pattern continuation, trading below the breakdown level of 35.9 which indicates correction in prices to continue.

WTI Crude Oil fell from 43.5 (Point X) in November end to the low of 34.5 (Point Y) in Mid December last year. Thereafter, prices went in to consolidation phase and retraced over 50% of the fall from Point X to Point Y and touched 38.38 on the higher side, before resumption of downtrend.

WTI Crude Oil is expected to decline further from the current levels if it sustain below the level of 36.

The difference between Point X and Point Y comes to 9 points. Considering 100% of this difference from breakdown point Z @ 35.9, the downside target comes to 26.9 level. Thereafter, the next target could be 25 and 21.4, which are 121 and 161% of the same difference.

However, if WTI Crude Oil reverts from the current level and crosses the resistance of 40 daily on closing basis then prices may rise towards 51 level. 

WTI Oil Faces Resistance At $38/bbl

WTI Crude Oil (Nymex) : Sell @ 35.41 (CMP) | Stop @ 38| Target @ 26.75 — 21.65 

The WTI Oil is currently quoting at $35.4/bbl trading below the previous bottom point B at 37.75 level. The above technical chart shows A-B-C Pattern, with Wave C is in continuation. The chart indicates that downfall in prices will continue in the coming sessions if resistance of 38 holds on daily closing basis. .

WTI Oil had fallen from 62 (Point A) in June and tested the support level of 37.75 (Point B) in August. Thereafter, prices retraced by more than 50% of fall seen from Point A to Point B and tested the high of 51 (Point C) nearing to 61.8% and resumption of down trend was seen.
WTI Oil prices are trading below the previous bottom  of point B at 37.75 and is expected to continue to move downward unless a breakout occurs above 38 on closing basis. If  prices breaks the support of 34.75 then prices would weaken further.
The difference between Point A and Point B comes to 24.25 points. Considering 100% of this difference from Point C, the downside target comes to 26.75 level. Thereafter, the next target could be 21.65, which is 121% of the same difference.
However, if prices reverts from the current level and crosses the resistance of 38 on closing basis then prices may rise towards 51 level.

WTI Oil Faces Resistance At $38/bbl

WTI Crude Oil (Nymex) : Sell @ 35.41 (CMP) | Stop @ 38| Target @ 26.75 — 21.65 

The WTI Oil is currently quoting at $35.4/bbl trading below the previous bottom point B at 37.75 level. The above technical chart shows A-B-C Pattern, with Wave C is in continuation. The chart indicates that downfall in prices will continue in the coming sessions if resistance of 38 holds on daily closing basis. .

WTI Oil had fallen from 62 (Point A) in June and tested the support level of 37.75 (Point B) in August. Thereafter, prices retraced by more than 50% of fall seen from Point A to Point B and tested the high of 51 (Point C) nearing to 61.8% and resumption of down trend was seen.
WTI Oil prices are trading below the previous bottom  of point B at 37.75 and is expected to continue to move downward unless a breakout occurs above 38 on closing basis. If  prices breaks the support of 34.75 then prices would weaken further.
The difference between Point A and Point B comes to 24.25 points. Considering 100% of this difference from Point C, the downside target comes to 26.75 level. Thereafter, the next target could be 21.65, which is 121% of the same difference.
However, if prices reverts from the current level and crosses the resistance of 38 on closing basis then prices may rise towards 51 level.

Rupee Outlook: INR Fall May Continue Versus US Dollar

USDINR Spot Buy @ 66.76 | Stop @ 64.68 | Target @ 69.12 — 71.73 — 75.78

The Indian rupee, currently quoting at 66.76/$, is expected to continue its decline against the US dollar and it can test the level of 71.73 in the medium term.

The Indian rupee depreciated to test an all-time low of 68.80 (Point B) in August 2013 from 51.36 (Point A) level in October 2012.

Thereafter, the rupee appreciated to test the level of 58.34 (Point C) in May 2014. The local currency depreciated later, moving in a channel, and recently touched a low of 67/$.

The rupee is expected to cross the resistance level of 67.06, which is 50% expansion and will further depreciate to test the level of 69.12 and 71.73, which are 61.8% and 76.4% expansion of Point A-Point B from Point C, respectively.

The rupee is likely to get weaker as the Dollar Index will strengthen against the basket of currencies due to signs of improvement in the US economy. The Dollar Index is currently at 98.20 and can move further higher. If it remains above the support level of 97.50 then the Dollar Index may rise towards 101 and 103 levels.

However, if rupee appreciates from the current level and crosses 64.68 then currency may appreciate further to 62.15 level, which seams difficult at current scenario.