Report on Lead & Wheat....

1. Commodity Insight
28th October, 2011
Turnover of 27.10.11 Commodity Rate Rate Up / Down
28.10.11 27.10.11
Exchange Turnover (Cr.) Gold $ 1737.30$ 1745.00$ - 7.70$
MCX 56015 Silver $ 35.24$ 35.10$ 0.14$
NCDEX 3466 Crude $ 92.82$ 93.70$ - 0.88$
USDINR 49.08 49.76 - 0.68
Lead
Fundamentally, in past few months prices of base
metals are falling in tandem with global equity
markets. The major consumption of Lead is in China
from automobile sector. Even in last few months
China reported a Q3 GDP of just 9.1%, it is the
slowest growth since 2009. However at the global
economy is again changing & fears of slow down in
global economic market is getting less after EZ debt
crisis has found solution and GDP of China & US is
also improving. Demand for Lead is also increasing
from Japan, as their economy is coming back on
track after earthquake hit in March 2011.
Technically, Lead has been moving down from past
three months, we have seen prices correcting from
the high of 123 to 88 levels i.e. a correction of 35 Rs
from higher levels. At present Lead looks oversold
and also after such a sharp fall there should be some
pull back in prices from present levels. So correction
in prices till 90Rs.should be used as buying
opportunity for the target of 101 and 107 levels.
In Long term we expect Lead prices to move up and touch levels of 112 and 125 in next two to
three months. Lead is bullish till the time prices are trading above 77 Rs. Correction or dips in
prices till 88 or 90 Rs should be used as buying opportunity for the target of 112. We maintain
our bullish view in Lead for next two to three months.
Wheat
Fundamentally, the price of Wheat has come down by 20 percent in last six months but the prices will
have support at lower levels because on 25.10.11 The Indian cabinet increased the minimum price for
wheat purchase from farmers by about 15% to INR 1, 285 per 100 kilograms in order to encourage
higher sowings of the grain staple during the winter season. The government also wants to build up its
grain stocks before introducing a food security law guaranteeing cheap grains to the majority of its
population.
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2. Commodity Insight
28th October, 2011
Technically, Wheat has been moving down from past few
months, we have seen prices correcting from 1200 levels
to 1025 i.e. a correction of approx 200 Rs from higher
levels. But at present prices seems to take support at
lower levels and historically also we have seen that
Wheat prices start moving up from the month of
November.
We expect Wheat prices to move up and touch levels of
1200 again, if prices are able to break and give close
above 1210 then further bullishness in prices can be
seen till 1270 and 1300 Rs in next three months. So
overall buying is suggested at current levels or on dips in
prices till 1070 levels for the target of 1200 and 1280 Rs.
We maintain our bullish view in Wheat.
Lead
LEAD - 1 KG - 1 MONTH (97.0000, 99.1000, 95.4000, 98.9500, +2.10000)
135
130
125
120
115
110
105
100
95
90
Relative Strength Index (51.3122) 80
70
60
50
40
30
20
Volume (54,935,000)
18000
17000
16000
15000
14000
13000
12000
11000
10000
9000
8000
7000
6000
5000
4000
3000
2000
1000
x10000
10 17 24 31 7 14 21 28 7 14 21 28 4 11 18 25 2 9 16 23 30 6 13 20 27 4 11 18 25 1 8 16 22 29 5 12 19 26 3 10 17 24 31 7
2011 February March April May June July August September October November
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3. Commodity Insight
28th October, 2011
Daily Trading Range
 Lead today’s trading level are 96.70 – 100.40.
 Intraday support @ 96.70 – 97.40 and Resistance @ 99.00 – 100.40.
 Intraday Trend Sell on rise.
 Lead Sell @ 99.00 SL 100.40 TGT 97.40 – 96.70 …..
Open Calls
Date Type Commodity Initiated Stop Target Closing Comments
of Price Loss Price
Call
25.10.11 Sell Lead Mini 96.10-97 99.50 92-89.90 96.90
st
Almost 1 TGT
15.10.11 Buy CPO NOV 467-469 460 481-502 475.70 Achieved @
479.50, Hold with
SL @ 467.
Spread Calls
Date Type Commodity Initiated Stop Target Comments
of Price Loss Spread
Call Spread
- - - - - - -
Report by : -
Sumeet Bagadia (Head - Commodity & Currency Research) sumeet.bagadia@destimoney.com
Mohit Kothari (Research Associate) mohit.kothari@destimoney.com
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4. Commodity Insight
28th October, 2011
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