Buy gold, pressure on rupee to continue: Emkay Commodities

Ashok Mittal, CEO, Emkay Commodities, says that the rupee is also depreciating, so the upside momentum in the Indian market may be slightly better. We advice investors to buy gold at Rs 29,700 and keep Rs 200 as a stop loss and on the upside we expect a target of above Rs 30,000. Right now, gold is a buy.

We do have, the rupee should continue to depreciation for some more time because the equity market is not doing well and the euro is falling. So, the euro and rupee movement is almost the same. So euro is below 1.22 which was a good support. Now, it is approximately at 1.2080. So the pressure on rupee will continue for some more time. Below is the edited transcript of his interview to CNBC-TV18.
Q: Internationally crude is at USD 103. Now, what is your advice to your clients?
A: The upside momentum was quite fast when it was sub-USD 80 and went up. We feel that profit booking is happening, and the overall environment is not supporting the prices to remain higher for the short term.
We expect some possible downside from the current levels. Right now, it is advice able to sell it at USD 89 with a stop loss of USD 91. On the downside, we expect it to achieve USD 85-86 in next few trading sessions.
On MCX, Rs 5,000 is a level which can be shorted, and when you see a USD 1-1.5 upside as a stop loss, may be Rs 100 stop loss from that level. On the downside, we expect it to touch Rs 4,900 or fall below. So right now we advice investors to go short on the upticks. Q: Gold has slipped into a range in the last few days. How is it looking in the local market?
A: Gold is in a very tight range. We expect that the same range to be maintained for some time because there are no fresh triggers. The factors for the international and Indian markets are now quite different.
On the downside, we expect the support range of USD 1550 which should not be broken and USD 1610-1620on the higher side. We don't expect much downside now. We are advising investors to buy gold at USD 1575-1578 and keep USD 1555 as a stop loss and USD 1610-1620 as the target on the higher side.
Rupee is also depreciating, so the upside momentum in the Indian market may be slightly better. We advice investors to buy gold at Rs 29,700 and keep Rs 200 as a stop loss and on the upside we expect a target of above Rs 30,000. Right now, gold is a buy. Q: You wouldn't have a trading strategy on the currency futures at this point would you?
A: We do have, the rupee should continue to depreciation for some more time because the equity market is not doing well and the euro is falling. So, the euro and rupee movement is almost the same. So euro is below 1.22 which was a good support. Now, it is approximately at 1.2080. So the pressure on rupee will continue for some more time. Q: What is the trading strategy on base metals?
A: China is not doing well and there are many issues with the European economy. Although the opening is positive, we expect the base metal to remain under pressure. We expect copper and nickel to go down further. We are advising to sell LME 3 month forward for Rs 7,500 and expect a target of Rs 7,200-Rs 7,300. For copper at Rs 414-415 on the MCX.