Base metals complex gained some momentum in the last trading session after the release of strong manufacturing data from U. S. which raised the expectations of an improvement in demand and thereby enhanced the risk appetite of investors. The fall in dollar also supported the upside in base metals prices.

Lead and Nickel were up by more than 2% on MCX.

The U. S. Commerce Department reported new orders for durable goods rose 1.9 percent from March, the biggest percentage advance since December 2007.

Separate reports showing sales of new U. S. single-family homes rose slightly in April and fewer workers filed for first-time jobless aid last week added to recent optimism that the worst of the deep economic recession was likely over.

Stocks of copper in LME warehouses fell by 2,150 tonnes to 317,125 tonnes while cancelled warrants rose to 43,650 from 43,375 tonnes.

Japan's exports of refined copper in April rose 154 percent from a year earlier to 65,879 tonnes, the seventh straight month of increases, helped by demand in China, Ministry of Finance data showed.

Japan's exports of refined zinc in April amounted to 13,098 tonnes, up 106 percent from the same month a year earlier, Ministry of Finance data showed.

Base metals moved up yesterday on the back of strong durable goods order report and increased optimism on a global recovery. We recommend buying Copper and Nickel at dips during the day.

Copper prices are seen to be range bound, taking resistance at 225.5 and support at 221 levels. Breaching 225.5 levels can trigger a journey towards 235-40 levels. Looking at MACD and RSI, copper looks positive. Therefore, one can buy copper between 223- 225 with a Stop loss of 220, targeting 227-229.

Lead prices remained firm in the previous session, closing higher at 69.7. Therefore, lead looks positive above 68 (closing above 68 for the past three sessions). The RSI is also moving northward. Thus, lead can touch levels of 73-74. For the day, one can buy lead June contract at lower levels of around
69.5-70, with a SL of 68, targeting 72 and 72.8.

Nickel prices look bullish as it gave a close above 644 in the May contract. Nickel looks positive from these levels. The RSI is rising showing some buying interest. Also the MACD is giving a positive indication by cross-over on the upside.

Thus, one can buy Nickel at every dips for higher levels. For the day, one can buy Nickel June contract around 645-650 with a SL of 637, targeting 672-75 levels on upside.