Technically Nickel market is under long liquidation as market has witnessed drop in open interest by 3.22% to settled at 1141 while prices down 4.4 rupees.
Now MCX Nickel is getting support at 1415.7 and below same could see a test of 1391.3 levels, and resistance is now likely to be seen at 1459.9, a move above could see prices testing 1479.7.
Nickel yesterday settled down by 0.3% at 1440 on growing concern about China’s crackdown on the real-estate sector.
However downside seen limited as supply fears resurfaced after an Indonesian government official said the country was looking at taxes on exports of the stainless steel ingredient.
Investment minister Bahlil Lahadalia said Indonesia is exploring the possibility of levying an export tax on nickel products with less than 70% nickel content to drive expansion of the country’s domestic processing industry.Stocks of nickel in LME-registered warehouses have dropped 35% since April to 171,714 tonnes.
Cancelled warrants metal earmarked for delivery at 35% and one company holding large amounts of warrants are also fuelling concern about a tight LME market.This pushed the premium for cash metal over the three-month contract to $32 a tonne, up from $15.
Global nickel mine production is expected to grow by 6.8% to reach 2,427.4 thousand tonnes (kt) in 2021, after registering an estimated 4.2% decline to 2,272kt in 2020, owing to COVID-19-related lockdowns and restrictions. Fitch Solutions expects nickel mine production to grow strongly between 2021 and 2023, owing to less disruption from Covid-19 and amid a high price environment.
Trading Ideas:
–Nickel trading range for the day is 1391.3-1479.7.
–Nickel dropped on growing concern about China’s crackdown on the real-estate sector.
–Stocks of nickel in LME-registered warehouses have dropped 35% since April.
–Global nickel production to recover by 6.8% in 2021.
Courtesy: Kedia Commodities
Source: Comodity Online
