Kunal Shah of Nirmal Bang Commodities on Tuesday said that weakness in dollar index can lead to a bounce back in commodity prices.
“Volatility is the theme right now and we continue to see that. I believe that the dollar index can marginally weaken and that can lead to some bounce back in commodity prices, especially in bullion,” he said in an interview to CNBC-TV18.
Shah expects to see some short covering to happen in gold and silver. “We have seen gold and silver constantly under pressure since last 10 days. So we can see some bit of short covering in gold and silver, especially silver. You can go long around Rs 65,800 with upside target of Rs 66,500-66,600,” he said.
On base metals, he is positive on copper. “Copper looks very attractive to go long because the LME inventory stands at record low levels and that can lead to buying in copper. One can go long at Rs 608, put a stop loss of Rs 605 and expect it to move and test levels of Rs 615-616.”