Pepper February futures are expected to continue the down trend on extended selling pressure. According to trade sources, arrivals coming at terminal market are having moisture content therefore, it is fetching lower prices.
Reports of starting for fresh crop season and lower prices quoted by Vietnam might also add to the down side. However, short covering at lower levels can not be over ruled.
Indian prices in global market are quoted at $6500-6550 & $6800- 6850 per MT for Europe & US FOB. As per data released by Spices board, during Apr-Nov, 2011 Pepper export from India were reported up by 43% to 17,000 tonnes against the same period last year.
According to derivative analysis, prices and open interest have declined while volumes have increased. It is a good indication that market is running out of traders willing to open or hold an open position.
Traders are liquidating both loosing long positions & closing winning short positions. A higher probability the market is set to retrace in price lower.
Pepper NCDEX Feb-12 support: 28611 29023 resistance: 30081 30621 Trading Range: 29050-30750
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