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Technically Aluminium market is under short covering as market has witnessed drop in open interest by 3.75% to settled at 2897 while prices up 2.35 rupees.
Now MCX Aluminium is getting support at 138.7 and below same could see a test of 136.7 level, And resistance is now likely to be seen at 141.9, a move above could see prices testing 143.1.
Aluminium on MCX settled up 1.7% at 140.65 tracking LME prices closed 1.4 percent higher at $2,029 on concerns about lean supply. Traders in the east China aluminium spot market stood on the sidelines in anticipation of larger spot discounts as social inventories began to grow.
China’s primary aluminium social inventory extended its weekend gains as consumption weakened on a seasonal lull and as deliveries arrived at the warehouses. The inventory across eight major consuming areas, including SHFE warrants, increased by 22,000 mt from last Thursday to stand at 1.82 million mt.
China’s export volumes of unwrought aluminium and aluminium products logged its second monthly high, of all time, in June as the growth in extrusion exports exceeded the decline in flat rolled product exports.
China exported 510,000 mt of unwrought aluminium and aluminium products in June, up 25,000 mt from May and up 10.9% from the same period last year, next to the highest of 540,000 mt recorded in December 2014, data from China Customs showed.
The top Chinese steelmaking city of Tangshan ordered steel mills, coke producers and utilities to cut output further from July 20 until Aug. 31, in addition to the 10 percent-15 percent cuts imposed from March to November.
Tangshan did not instruct factories on how much output should be reduced, but the market expects sintering production, a process where iron ore is heated to make hot metal, to be curbed by 30 percent-50 percent.
Trading Ideas:
–Aluminium trading range for the day is 136.7-143.1.
–Aluminium prices gained tracking LME prices closed 1.4 percent higher at $2,029 on concerns about lean supply.
–Traders in the east China aluminium spot market stood on the sidelines in anticipation of larger spot discounts as social inventories began to grow.
–China’s primary aluminium social inventory extended its weekend gains as consumption weakened on a seasonal lull and as deliveries arrived at the warehouses.
Courtesy: Kedia Commodities
Source: Commodityonline.com
