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Monday, May 16, 2022

Zinc market under long liquidation; Support seen at 192.1

Copper market under long liquidation; Support seen at 450.5

MCX Nickel under fresh selling; Support seen at 911.1

MCX Aluminium may trade between 147.4-152 levels

MCX Menthol Oil under fresh selling; Resistance seen at 1723.4

MCX Cotton under long liquidation

Technically Zinc market is under long liquidation as market has witnessed drop in open interest by 1.48% to settled at 4528 while prices down 0.4 rupees.

Now MCX Zinc is getting support at 192.1 and below same could see a test of 190.3 levels and resistance is now likely to be seen at 195.4, a move above could see prices testing 196.9.

Zinc on MCX settled down -0.21% at 193.80 as pressure seen on the report that accumulated inventories and negative macroeconomic sentiment weighed.

While concerns are there as CHINA debt Off-balance-sheet borrowings by Chinese local governments could be as high as 40 trillion yuan ($5.78 trillion) and amount to “a debt iceberg with titanic credit risks”, S&P Global Ratings said in a report on Tuesday.

Last night the US dollar index dropped to more than two-week lows on Tuesday while emerging market currencies outperformed, as rising stock markets reflected improving risk appetite. Both LME and SHFE base metals ended in mixed performance overnight.

LME aluminium, zinc gained close to 0.2% while copper dipped 0.1%, nickel slid 0.4% and lead lost 0.67%. SHFE nickel and lead sank close to 0.8%, copper and zinc dropped some 0.4% while aluminium rose some 0.7%.

From data point Chinese consumer inflation accelerated for a fourth month in September, with food prices jumping by the most since February, while the rise in households’ non-food costs slowed. The CPI rose 2.5% from a year earlier, marking the largest annual growth in seven months, according to data from the NBS.

The PPI climbed 3.6% from a year ago, compared with a 4.1% gain the previous month. From US side data showed US industrial production increased for a fourth straight month in September, boosted by gains in manufacturing and mining output, but momentum slowed sharply in the third quarter.

Trading Ideas:
–Zinc trading range for the day is 190.3-196.9.
–Zinc dropped amid lean factory-gate inflation data in China and nagging concerns about global growth.
–Production cutbacks at China’s zinc smelters in response to tighter environmental checks and weaker profits have tightened supply.
–Demand for refined zinc will exceed supply by 322,000 tonnes this year and 72,000 tonnes in 2019, the ILZSG said.

Courtesy: Kedia Commodities

Source: Commodityonline.com

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