MCX Mentha Oil under short covering; Support seen at 1292.9
MCX Nickel likely to trade in range between 963.5-1022.7
MCX Zinc expected to trade between 189.4-199.2 levels
MCX Copper may trade between 439-456.6 levels
Natural Gas market under short covering; Resistance seen at 200
Aluminium on MCX settled down 1.27% at 144.20 as shorts dominated in yesterday’s session. As market sentiment recovered, the Chinese stock market rebounded and the commodity market regained some losses.
As shorts closed out their positions, but we see limited speculative room for aluminium prices in the short term and the contract is likely to remain rangebound. Sentiment remained fragile in the face of tense trade relations between the United States and other major economies, with investors braced for another potentially rocky day for Chinese markets.
US President Donald Trump has this year sought to renegotiate some of the United States’ trading relationships, in particular with China. He has imposed tariffs on some imports, in turn sparking retaliatory action by other countries, raising fears of a global trade war.
Growth in China’s manufacturing sector cooled slightly in June as firms faced rising input costs and a decline in export orders amid an escalating trade dispute with the United States, a private survey showed on Monday. China accounts for nearly half of global copper consumption, estimated this year at around 24mts.
China’s central bank in April unexpectedly cut RRR for most banks, in a move that was earlier and more aggressive than expected, highlighting concerns over liquidity. Metals prices are likely to remain under pressure this week as traders digest the minutes of the Federal Reserve’s June meeting on Thursday, when markets re-open after Wednesday’s Independence Day holiday. The Fed hiked interest rates in June and signaled for the first time that they could lift rates four times this year, a typically negative factor.
Trading Ideas:
–Aluminium trading range for the day is 141.4-148.6.
–Aluminium prices remained under pressure as escalating U.S.-China trade tensions raised concerns about demand.
–China’s social inventory of primary aluminium declined slower over the weekend as downstream buyers’ procurement enthusiasm cooled.
–Inventories of primary aluminium, including SHFE warrants, across eight major consumption areas in China shrank 9,000 mt to stand at 1.84 million mt.
Courtesy: Kedia Commodities
Source: Commodityonline.com
