Technically Mentha Oil market is under short covering as market has witnessed drop in open interest by 3% to settled at 906 while prices up 2.4 rupees.
Now MCX Mentha Oil is getting support at 934.8 and below same could see a test of 929.9 levels, and resistance is now likely to be seen at 943.7, a move above could see prices testing 947.7.
Mentha Oil yesterday settled up by 0.26% at 939.6 on low level buying after prices dropped as demand from consumer side is extremely weak and industrial demand is also not picking up.
Prices got support in last few weeks as due to crop failure and low recovery of oil, availability of Mentha oil will be low and demand from industries are expected to improve ahead of winter season.
Speculation are also high that production this year will be lower as compare with last year because of two important factors. Major physical market player expects demand to sluggish for next few week as cash crunch seen in spot market, while expectations are high about demand improvement ahead of winter season starts.
China is one of the biggest buyer for Indian Mentha, no much buying inquiry from China as mainland China and Hong Kong markets were shut. Speculation are also high that production this year will be lower as compare with last year because of two important factors.
Firstly damages due to rain in key area and secondly farmers for the last 2 years where sowing mentha but due to not getting much profit at intervals there had been shift to other crops also. In Sambhal spot market, Mentha oil gained by 1.6 Rupees to end at 1065.6 Rupees per 360 kgs.
Trading Ideas:
–Mentha Oil trading range for the day is 929.9-947.7.
–In Sambhal spot market, Mentha oil gained by 1.6 Rupees to end at 1065.6 Rupees per 360 kgs.
–Mentha Oil gains on low level buying after prices dropped as demand from consumer side is extremely weak.
–Prices got support in last few weeks as due to crop failure and low recovery of oil.
–Availability of Mentha oil will be low and demand from industries are expected to improve ahead of winter season.
Courtesy: Kedia Commodities
Source: Comodity Online
