TOKYO, Dec 13 (Reuters) – Key TOCOM rubber futures edged down on Thursday, reversing earlier gains to a two-month high, as a fall in gold prices on fading hopes of further monetary easing dragged down other commodities and prompted investors to lock in profits.
While ample stocks in China, the world’s biggest rubber consumer, have curbed price gains, speculative buying could prop up the TOCOM market if a key technical ceiling of 275 yen is cleared, traders said.
“If the market breaks through above today’s high of 274.8 yen, that would for sure fuel more buying. But if not, that would form a typical bearish chart of a double top, resulting in a wave of selling,” said Toshitaka Tazawa, an analyst at Japanese brokerage Fujitomi Co.
The most-active Tokyo Commodity Exchange rubber contract for May delivery settled down 0.5 yen or 0.2 percent at 271.5 yen per kg.
The contract had earlier risen as high as 274.8 yen, the highest since Oct. 5, when a then-benchmark contract hit a high of 275.5 yen, the highest level since May 23.
The agreement earlier this week by the top three suppliers – Thailand, Indonesia and Malaysia – to keep curbing exports has had little impact on rubber prices, given few signs of a fall in inventories.
They started cutting exports from Oct. 1, in a plan that runs through the end of March.
The most active Shanghai rubber contract for May delivery closed down 100 yuan at 24,675 yuan per tonne.
The front-month January contract on the SICOM in Singapore was last traded at 285 U.S. cents per kg, down 1.1 cents.
In other markets, gold fell on profit-taking after the Federal Reserve linked its monetary policy to unemployment, raising concerns that future economic stimulus could be limited.
Gold benefits from easy monetary policy as it drives investors who fear diminishing value in fiat currencies to seek safety in hard assets such as bullion.
(Reporting by Risa Maeda; Editing by Anupama Dwivedi)
SOurce: Reuters
