Copper likely to trade in Rs 332-345/kg range: Kotak Comm

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A strong dollar and concerns on China raising interest rates earlier than expected is keeping the base metal complex. Analysts are approaching the complex with a sell on rally strategy.

In an interview with CNBC-TV18, Amol Tilak, Head Of Research, Kotak gave his strategy on copper, zinc and nickel.

Here is a verbatim transcript of the interview. Also watch the accompanying video.

Q: What is your strategy on base metals?

A: Copper over a period is most likely to trade in a broad range between around Rs 332-345 per kg. The strategy for copper would be that I would rather be on the short sell in that metal somewhere close to Rs 345 per kg. The way the European markets are behaving I do not see major sliding happening in the dollar which would augment a gain in copper prices.

There is an expectation that China may actually increase its interest rates maybe earlier than expected. Considering all these aspects, I would rather short sell copper somewhere at Rs 345 per kg and targeting somewhere close to Rs 335. A stop could be placed close to Rs 350 per kg.

Going ahead with other base metals like zinc and nickel, again selling on rise is recommended across the entire base metal complex. Zinc one can actually go short close to Rs 107. As far as nickel is concerned, somewhere close to Rs 975 is where we can go short.