MCX February Copper traded lower

Copper: MCX February Copper traded lower in the last week on account of euro-region debt crisis is sapping the economy in Germany, the world’s third-biggest user of the metal and weak manufacturing numbers in the world’s largest economy. Growth in German gross domestic product slowed to 0.7 percent last year from 3 percent in 2011. Manufacturing in the New York region contracted in January for the sixth straight month on the back of concerns of US debt ceiling which remains unresolved. There is also a concern on the downward revision of global growth in 2013 by the World Bank. World Bank has projected the global growth to decline to 2.4 percent in 2013 from the earlier estimates of 3 percent. However, Copper price recovered slightly from low on the back of positive economic data from US and China. U.S. housing starts rose most in four years while initial jobless claims declined to five year low, which indicates economic expansion. Industrial production in the U.S. climbed for a second month in December as demand picked up for business equipment, showing factories expanded even as lawmakers battled over the federal budget. China’s economic growth accelerated for the first time in two years as government efforts to revive demand drove a rebound in industrial output, retail sales and the housing market. Gross domestic product rose 7.9 percent in the fourth quarter from a year earlier. Industrial output in December rose a more-than- expected 10.3 percent and fixed-asset investment for the year gained 20.6 percent. Price movement in the last week: MCX February Copper prices opened the week at Rs 445.95/kg, initially traded slightly higher but found strong resistance at 447.80/kg. Later prices fell and touched a low of Rs 435.30/Kg and currently trading at Rs 439.10/Kg (January 18, Friday, 5.50 PM) with a loss of Rs 6.60/kg as compared with previous week’s close. Outlook for this week: MCX February Copper is expected to trade slightly higher on account of favorable economic data from US and China. MCX February Copper shall find a support at 432/428 levels and resistance 446/452 levels. Recommendation for this week: Buy MCX February Copper between 432-435, SL-427 and Target- 446/451. iv>