Technically Zinc market is under long liquidation as market has witnessed drop in open interest by 9.61% to settled at 1336 while prices down 3.05 rupees.
Now MCX Zinc is getting support at 255.1 and below same could see a test of 253.5 levels, and resistance is now likely to be seen at 259.5, a move above could see prices testing 262.3.
Zinc yesterday settled down by 1.17% at 256.75 as a power supply crisis gripped China, the largest metals consumer, shutting factories and casting doubt on the outlook for demand.
Goldman Sachs and Nomura revised down projections for China’s economic growth this year. Outside China, doubts were emerging about the global recovery as central banks prepared to reduce stimulus and the U.S. government lurched towards a funding crisis.
The global zinc market deficit narrowed to 6,600 tonnes in July from a revised deficit of 40,000 tonnes in June, data from the International Lead and Zinc Study Group (ILZSG) showed. Previously, the ILZSG had reported a deficit of 20,200 tonnes in June.
During the first seven months of 2021, the ILZSG data showed a surplus of 11,000 tonnes, down from a surplus of 420,000 tonnes in the same period of 2020. Around 13.5 million tonnes of zinc are produced and consumed each year.
The People’s Bank of China injected a total CNY 100 billion of 14-day reverse repos at an interest rate of 2.35 percent on September 29th 2021, the same as in the previous day, and marking the ninth straight day of cash injections in the financial system.
Trading Ideas:
–Zinc trading range for the day is 253.5-262.3.
–Zinc dropped as a power supply crisis gripped China, the largest metals consumer, shutting factories and casting doubt on the outlook for demand.
–Goldman Sachs and Nomura revised down projections for China’s economic growth this year.
–The global zinc market deficit narrowed to 6,600 tonnes in July from a revised deficit of 40,000 tonnes in June.
Courtesy: Kedia Commodities
Source: Comodity Online
