In an interview to CNBC-TV18, David Lennox of Fat Prophets says, crude is certainly going to take a bit of a breather and probably head downward over the next month or so.

On the other hand, he sees gold in USD 1,600-1,700 per ounce range. “It’s been locked into quite a stable range. We think the factors in the market could certainly push it both ways,” he asserts.

Below is the edited transcript of his interview with CNBC-TV18's Latha Venkatesh and Ekta Batra. Also watch the accompanying video.

Q: There have been quite a few analysts who have been telling us that given the current economic growth pace in the US and in the EU and even China, crude should not be trading at USD 125 per barrel for Brent or USD 110 per barrel for WTI. It should be trading much lower. Would you concur?

A: We certainly think that if you remove the supply side shocks that we have seen being priced into crude now for many months, we would expect to actually see the crude prices probably somewhat lower than where they currently are. So, we do think that the potential is there for perhaps the prices to, at some point over the next probably month or so, certainly take a bit of a breather and probably head downward rather than where we have seen them trading at the moment sideways.

Q: What kind of a range would you forecast for the current quarter, the April-June quarter?

A: That’s probably a fairly difficult question to answer. Talking about West Texas, we wouldn’t expect it to probably go much above USD 110 per barrel. We would probably be actually looking forward to certainly start falling towards USD 100 per barrel as the supply side shocks really start to be focused on carefully and probably start to come out of the pricing.

Q: What kind of downsides do you see in Brent?

A: With no oil shock pricing in there, we would expect to see West Texas probably below USD 100 a barrel. We would be probably looking at a range between USD 90 to USD 100 per barrel.

Brent, on the other hand, is a little more complicated because it is more reflective of what’s happening in the rest of the world. We would expect it to probably drop back towards USD 110 a barrel or USD 115 per barrel. We certainly think that participation in both those markets have valued in price shock premiums at quite high levels for many months.

Q: Gold has been pretty much an underperforming asset for 2012 atleast. Do you see it dipping further?

A: No, we are still quite a strong supporter of the gold story. Yes, we do believe that it may have difficulty getting back to its record highs. However, when you look at the events that are still going on globally, there is still that potential for safe haven pricing to be put back into the price of gold.

But certainly now we think that the key driver is going to be what sovereign governments are doing in terms of topping up their reserves. We think that that’s going to be key support to stopping the gold price from falling much lower and probably be over the medium-term start putting the price not on escalating right, but certainly up.

Q: What kind of range do you think gold could possibly hold in the next quarter or so?

A: Look, we certainly think that, at the moment, it’s been locked into quite a stable range. We can’t see it probably breaking above USD 1,700 per ounce and we certainly can’t see it wanting to drop below USD 1,600 per ounce. I know that’s quite a wide range, but we think the factors in the market could certainly push it both ways.

Q: Finally, the base metals. Let’s start with copper. It’s been again an underperformer compared to equities in the first quarter of this calendar. How do you see it moving? Do you see more downsides going by the news that we are getting from China?

A: For the month, we certainly think that copper will probably start to go a little bit stronger. We will start to go into the prime construction period in China. We do think that once we see that really up and going that copper will again start to respond. So, we would be looking for copper to move stronger over the next couple of weeks. Certainly, the recent PMI released that China pull out showed that seasonally adjusted the China’s industrial base is performing quite well.