Technically Zinc market is under long liquidation as market has witnessed drop in open interest by 13.18% to settled at 1541 while prices down 0.55 rupees.
Now MCX Zinc is getting support at 266.1 and below same could see a test of 263.5 levels, and resistance is now likely to be seen at 271.5, a move above could see prices testing 274.3.
Zinc yesterday settled down by 0.2% at 268.65 amid the stronger expectations of Fed’s tapering the debt purchase.
Howeevr, the impacts of the power rationing policy varied in different regions and industries.The global lead and zinc markets will be slightly oversupplied this year and next, the International Lead and Zinc Study Group (ILZSG) said.
On the macro front, the China government has issued notice to emphasis the stable supply of electricity related to people’s livelihood and the agriculture industry, which is likely to push up the industrial production costs.
On the fundamentals, there has been no signs of intensifying power rationing policy across China, and the zinc prices may stay high amid the comparatively low social inventories. The social inventory of zinc ingots stood at 119,800 mt as of September 30, which has been falling after set a record high at March 15, 2021.
China released 150,000 tonnes of industrial metals from its state reserves in the fourth round of sales this year as it continues a campaign to ease supply tightness and tame high commodity prices.
The world’s top metals consumer offered processors and manufacturers the chance to bid for 30,000 tonnes of copper, 70,000 tonnes of aluminium and 50,000 tonnes of zinc reserves on online platforms operated by state-run China Minmetals Corp and Norinco.
Trading Ideas:
–Zinc trading range for the day is 263.5-274.3.
–Zinc prices dropped amid the stronger expectations of Fed’s tapering the debt purchase.
–There has been no signs of intensifying power rationing policy across China, and the zinc prices may stay high amid the comparatively low social inventories.
–The global lead and zinc markets will be slightly oversupplied this year and next, the International Lead and Zinc Study Group (ILZSG) said.
Courtesy: Kedia Commodities
Source: Comodity Online
