MCX Zinc under fresh selling; Support seen at 187.1

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Technically Zinc market is under fresh selling as market has witnessed gain in by 16.66% to settled at 3369 while prices down 0.95 rupees.

Now MCX Zinc is getting support at 187.1 and below same could see a test of 186.4 level, and resistance is now likely to be seen at 189, a move above could see prices testing 190.2.

Zinc on MCX settled down 0.5% at 187.85 as re-escalation of US- trade tensions added to broad risk aversion.While weak PMIs from and the Eurozone, and deteriorated morale in the euro area suggested worsening conditions across the region.

Data showed that social inventories of refined zinc across Shanghai, Tianjin and Guangdong inched up over the weekend, growing the expectations for continual gains in inventories. Social inventories of refined zinc across Shanghai, Tianjin and Guangdong rose 1,600 mt from Friday August 2 to stand at 146,000 mt as of Monday August 5. With moderate arrivals, domestic zinc inventories continued to grow slower than expected.

confirmed it is suspending agricultural product purchases in response to US President Donald Trump’s decision to slap 10% tariffs on roughly $300 billion of Chinese imports, which ended a month-long trade truce. On the data front, China’s services sector expanded at the slowest pace in five months in July, showed a private survey.  Caixin purchasing managers’ index for China’s services sector edged down to 51.6 in July, from 52 in the previous month.

Growth in the US services sectors also decelerated in July, to its weakest level in three years as trade worries weighed on business orders and the outlook for the overall economy, a private survey showed. The US Institute for (ISM) said its non-manufacturing activity index fell to 53.7 from 55.1 the month before.

Trading Ideas:
–Zinc trading range for the day is 186.4-190.2.
–Zinc dropped as re-escalation of US-China trade tensions added to broad risk aversion.
–PMIs from Germany and the Eurozone, and deteriorated investor morale in the euro area suggested worsening conditions across the region.
–Social inventories of refined zinc across Shanghai, Tianjin and Guangdong inched up, growing the expectations for continual gains in inventories.

Courtesy: Kedia Commodities

Source: Commodityonline.com