Fresh selling seen in MCX Nickel; Support seen at 642.7
Commodity Online | September 16 2016
UPDATED 12:23:34 IST

MCX Mentha Oil likely to move in a range of 944-965.6

MCX Aluminium may trade between 142.7-145.5 levels

MCX Nickel likely to move in a range of 1043.9-1081.7

MCX Copper under fresh buying; Support seen at 520

MCX Zinc under long liquidation; Resistance seen at 192.3

Nickel on MCX settled down -1.53% at 648.90 in the line of expectation tracking weakness from LME Nickel which slumped to the lowest in more than two months after worries eased that an environmental crackdown in the Philippines would create shortages. LME Nickel was up about 12% this year, having hit a one-year peak in early August as authorities in the Philippines launched a campaign to close mining operations that failed to meet environmental regulations. LME nickel prices having fallen nearly 5% early in the week. The global market deficit in nickel narrowed to 5,200 tonnes in July from a revised deficit of 12,100 tonnes the month before, taking the shortfall so far this year to 42,500 tonnes, data from the INSG showed.

Worries about Philippines nickel ore supply curtailing feed to China's vast stainless steel industry have been the key drivers of nickel's 24% rally over June and July. Those worries have dissipated after a crackdown on mines that failed to pass environmental regulations appeared not to spread as widely as had been feared. A conclusion to the country's mining audit is now expected on Sept. 22. Also the INSG report showed robust Philippines nickel mined ore supply in July at 47,000 tonnes and on par with 52,000 in June and 45,000 in May.

Meanwhile, Japanese manufacturers' confidence bounced from a three-year low, while sentiment in the services sector hit its lowest since 2013 when the central bank began bold monetary stimulus underscoring a fragile economic recovery. Now technically market is under fresh selling and getting support at 642.7 and below same could see a test of 636.6 level, And resistance is now likely to be seen at 660.4, a move above could see prices testing 672.

Trading Ideas:

--Nickel trading range for the day is 636.6-672.

--Nickel slumped to the lowest in more than two months after worries eased that an environmental crackdown in Philippines would create shortages.

--The global market deficit in nickel narrowed to 5,200 tonnes in July from a revised deficit of 12,100 tonnes the month before, INSG showed data.

--Nickel stocks in LME registered warehouses at 367,806 tonnes are down from above 450,000 tonnes in the middle of January.

Courtesy: Kedia Commodities

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