MCX Mentha Oil under fresh selling: Support seen at 1679.2
MCX Aluminium under long liquidation: Support seen at 144.5
MCX Nickel under fresh selling; Support seen at 885.5
NCDEX Chana under fresh buying; Support seen at 4225
Short Covering seen in MCX Cotton
Technically Zinc market is under long liquidation as market has witnessed drop in open interest by 15.99% to settled at 4680 while prices down 4.2 rupees.
Now MCX Zinc is getting support at 192.9 and below same could see a test of 191.1 level, And resistance is now likely to be seen at 198, a move above could see prices testing 201.3.
Zinc on MCX settled down 2.11% at 194.65 on profit booking after prices seen supported on investors worry about ultra-tight stocks. Chinese Premier Li Keqiang vowed to use government levers to underpin growth, while zinc prices lurched on news of a tax cut.
Li promised broad policy steps to prevent a sharper slowdown for the world’s second-biggest economy, the biggest consumer of base metals. Zinc prices fluctuated wildly and Shanghai Futures Exchange (ShFE) spreads ballooned after Li said a planned cut in value-added tax (VAT) on China’s manufacturing sector, which includes non-ferrous metals, would take effect from April 1.
Low inventories and fears of production outrages has spurred a strong backwardation in LME zinc. The premium for cash zinc over the three-month LME contract stood at $55 a tonne at Thursday’s close, the highest since early January.
The global zinc market deficit narrowed to 28,000 tonnes in January from a revised deficit of 62,400 tonnes in December, data from the International Lead and Zinc Study Group (ILZSG) showed. U.S. manufacturing output fell for a second straight month in February, offering further evidence of a sharp slowdown in economic growth early in the first quarter.
The Federal Reserve said manufacturing production dropped 0.4 percent last month, held down by declines in the output of motor vehicles, machinery and furniture. Data for January was revised up to show output at factories falling 0.5 percent instead of slumping 0.9 percent as previously reported.
–Zinc trading range for the day is 191.1-201.3.
–Zinc prices dropped on profit booking after prices seen supported on investors worry about ultra-tight stocks.
–China January to February zinc output down 8.2 percent from a year earlier at 851,000 tonnes, the National Bureau of Statistics said
–The low-inventory situation, as well as fears of production outrages, has spurred the backwardation in London Metal Exchange zinc higher.
Courtesy: Kedia Commodities