Zinc yesterday traded with the negative node and settled -2.89% down at 89.85 tracking LME base metal prices overnight generally closed with declines.
The market was concerned over the economic outlook, and European leaders did not give explicit statements about the expansion of EFSF, and Spain's credit rating was cut by Moody's. In this context, LME zinc prices inched down as of the morning trading, dipping to USD 1,829/mt and finally closing at USD 1,831/mt, down USD 28/mt. Market pessimistic sentiment is unlikely to recover today, and panic sentiment will force Zinc prices to lower further to look for support.
However, Greece this morning initially passed the austerity plan of cutting salaries and increasing taxes, showing Greece will not allow the country's situation to worsen any further, at least temporarily, which will probably help the Euro slow its declines.
In yesterday's trading session zinc has touched the low of 89.75 after opening at 91.95, and finally settled at 89.85. For today's session market is looking to take support at 89.1, a break below could see a test of 88.3 and where as resistance is now likely to be seen at 91.3, a move above could see prices testing 92.7.
Trading Ideas:
Zinc trading range is 88.3-92.7.
Pressure seen in Zinc after Moody’s cut Spain’s credit rating by two notches to A1 from Aa2.
LME ZINC DROPS TO 16-MONTH LOW ON EURO ZONE DEBT FEARS; LEAD HITS 3-WEEK LOW
GLOBAL REFINED ZINC MKT IN 263,000T SURPLUS IN JAN-AUG 2011 - ILZSG
Courtesy: Kedia Commodities
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