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Monday, October 18, 2021

MCX Zinc under fresh selling; Resistance seen at 258.5

Technically Zinc market is under fresh selling as market has witnessed gain in open interest by 4.64% to settled at 1375 while prices down 1.85 rupees.

Now MCX Zinc is getting support at 254.7 and below same could see a test of 253.2 levels, and resistance is now likely to be seen at 258.5, a move above could see prices testing 260.8.

Zinc yesterday settled down by 0.72% at 256.3 amid lingering concerns over the fate of China Evergrande. Worries over defaults at Chinese property developers and the potential impact on metals demand grew, amid fresh credit rating downgrades and uncertainty about the fate of China Evergrande.

Mitsui Mining and Smelting Co Ltd , Japan’s biggest zinc smelter, plans to produce 113,200 tonnes of refined zinc in the second half of the 2021/22 financial year to March 31, down 2.2% year on year, it said.

Toho Zinc Co Ltd, Japan’s third-biggest zinc smelter, plans to produce 47,800 tonnes of refined zinc in the second half of the 2021/22 financial year, up 1.9% from a year earlier, it said.

Total zinc inventories across seven Chinese markets stood at 119,800 mt as of September 30, down 11,500 mt from September 27 and 9,400 mt from September 24. The inventory in Shanghai declined sharply amid increasing pre-holiday restocking by downstream plants.

Guangdong saw a decrease in stocks as maintenance at smelters affected the shipments and downstream producers still have pre-holiday restocking demand.The global zinc market deficit narrowed to 6,600 tonnes in July from a revised deficit of 40,000 tonnes in June, data from the International Lead and Zinc Study Group (ILZSG) showed.

Trading Ideas:
–Zinc trading range for the day is 253.2-260.8.
–Zinc prices dropped amid lingering concerns over the fate of China Evergrande.
–Japan’s Toho Zinc plans 1.9% increase in H2 zinc output.
–Japan’s Mitsui Mining expects 2.2% drop in H2 zinc output.

Courtesy: Kedia Commodities

Source: Comodity Online

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