Technically Zinc market is under long liquidation as market has witnessed drop in open interest by 1.69% to settled at 1802 while prices down 2.75 rupees.
Now MCX Zinc is getting support at 274.5 and below same could see a test of 273 levels, and resistance is now likely to be seen at 278.6, a move above could see prices testing 281.2.
Zinc yesterday settled down by 0.99% at 276 as stocks of zinc in LME-registered warehouses rose 26,475 tonnes to 190,900 tonnes, up about 25% since last week.
Rising inventories have eased worries about zinc supplies and helped to narrow the premium for cash metal over the three-month contract. In China, the ore supply tightened, and TCs are expected to move down further. The supply of zinc fell short.
Also, due to an environmental protection incident, the operating rates of galvanising plants in the north were restricted, and some infrastructure construction projects were also postponed until next year.
The Asian Development Bank trimmed its growth forecasts for developing Asia for this year and next to reflect risks and uncertainty brought on by the new Omicron coronavirus variant.
The Manila-based lender now sees 2021 gross domestic product (GDP) growth of 7.0% for developing Asia, down from 7.1%, and 2022 growth of 5.3%, down from 5.4% in September.
“COVID-19 has receded in developing Asia, but rising infections worldwide and the emergence of a fast-spreading variant suggest that the pandemic will take time to play out,” the ADB said in a supplement to its Asian Development Outlook report.
Trading Ideas:
–Zinc trading range for the day is 273-281.2.
–Zinc prices dropped as stocks of zinc in LME-registered warehouses rose about 25% since last week.
–Rising inventories have eased worries about zinc supplies and helped to narrow the premium for cash metal over the three-month contract.
–Due to an environmental protection incident, the operating rates of galvanising plants in the north were restricted.
Courtesy: Kedia Commodities
Source: Comodity Online
