Zinc yesterday traded with the positive node and settled 0.48% up at 103.45 tracking LME zinc which opened at USD 2,240/mt, picking up the momentum from Obama planning to develop new economic stimulus plan, although had dipped to USD 2,210/mt, prices once surged to USD 2,269/mt.
As Bernanke failing to mention any specific plan to revitalize the economy triggered market concerns, LME zinc prices fell to close at USD 2,243/mt, stabilizing at the 10-day moving average.
With British and European central banks’ decisions to keep interest rates unchanged and ECB President Trichet’s warning against high inflation pressure, increasing economic risk and a huge dial-back in economic growth in the euro zone on Sept 8th, the euro plunged to USD 1.3872, a new low since July 12th, while the US dollar index stood back above 76.
Later during the day, the US Dept of Labor announced that new unemployment claims surged unexpectedly to 414k during previous week, indicating unemployment rate remained high, and US Fed president Bernanke did not mention any economic stimulation policy either during later speech, which caused US stock prices to close lower.
Base metals only slightly trimmed gains, however, with announcement of employment aid package by US President Obama. For today's session market is looking to take support at 102.1, a break below could see a test of 100.7 and where as resistance is now likely to be seen at 104.6, a move above could see prices testing 105.7.
Trading Ideas:
Zinc trading range is 100.7-105.7.
Zinc gained picking up the momentum from Obama planning to develop new economic stimulus plan
British and European central banks’ decisions to keep interest rates unchanged.
ECB President Trichet’s warning against high inflation pressure, increasing economic risk
Courtesy: Kedia Commodities
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