MARKET COMMENTARY
Following a steep plunge towards its weakest level in about four years, RSS4 on NMCE was seen bouncing back on Tuesday. The near month February rubber futures rebounded following an initial plunge to end more than one per cent up. In the physical market, the grade stayed rather steady near Rs.145 a kg, its weakest level since early-March 2010. While the broad trend stayed bearish, Kerala State government is considering procuring rubber in the wake of the steep plunge in prices may lend support.
A mixed trend is being witnessed in the overseas market on Wednesday. While TOCOM rubber futures were off the seven month low tracking gains in equities and weakening yen, SHFE rubber futures remained under pressure, stretching earlier losses. While swelling stockpiles and concerns over demand has been pondering upon market for a while, with week long Lunar New Year holidays to start in China this weekend may keep the activities on the lower side.
MARKET NEWS
Kerala is considering a proposal for the procurement of rubber to minimise the impact on farmers reeling under the fall in price of natural rubber. The Chief Minister on Tuesday said that the government has sought assistance of Rs.100 crore from the Price Stabilisation Fund Trust under the Union Commerce Ministry for the same.
Crude rubber stockpiles held at Japanese warehouses stood at eight month high, up 17.6 percent to 15474 metric tons on Jan. 20 from 10 days earlier, according to data from the Rubber Trade Association of Japan.
India government is working on a comprehensive national policy for the rubber sector to address a host of issues being faced by growers and the industry.
Rubber inventories monitored by SHFE rose 1.8 per cent last week to 204541 tonnes.
According to Thai Office of Agricultural Economics, rubber production in Thailand may rise 4.3 per cent in 2014 to 4.03 million tonnes.
TECHNICAL VIEW
RUBBER Feb NMCE
While the broad trend stays bearish, the rebound witnessed from 14000 ranges is likely to continue towards 14750 initially followed by 14900 or more to 15100 levels. However, it is necessary to break and sustain above 15100 ranges to lessen the prevailing weakness. On the other hand slippage past 14350 may see prices revisiting the recent lows or more.
TURNAROUND
|
Resistances |
LEVELS |
Supports |
|
14750/14900 |
15100-14350 |
14500/14350 |
|
15100/15250 |
|
14200-14150 |
|
15400/15550 |
|
14050/13850 |
Source: Geojit Comtrade
Download this report (full content – PDF file) here
