Kunal Shah, Head of Commodities and Currency Research, Nirmal Bang Commodities on Wednesday said he is not bullish on the metal complex and expects at least 5-8 percent correction, if not more.
“I am not optimistic about the outlook of steel, aluminium and copper. I am expecting a correction in most of these metals,” he told CNBC-TV18.
He believes that metals have already seen peak growth and the liquidity from the US and Europe is going to be moderate in the coming months.
Shah also expects copper to remain under pressure. “Rs 710 per kilogram (kg) is the good level to go short for the downside target of Rs 700 per kg and the stop loss should be placed at Rs 714 per kg,” he said.
Gold, however, looks attractive to him. He said he is not bullish at this stage but “very bullish” in the long term. “We are going to see the tapering announcement by ECB tomorrow by Fed,” he said, adding that maybe 15-30 days down the line, the dollar index can strengthen post the announcements. There will be some correction in gold prices during those times and that will be an excellent opportunity to go long for the next one and a half to two years, he explained.
For the full interview, watch the accompanying video.