Technically Aluminium market is under short covering as market has witnessed drop in open interest by 2.26% to settled at 691 while prices up 1.35 rupees.
Now MCX Aluminium is getting support at 136.8 and below same could see a test of 135.9 levels, and resistance is now likely to be seen at 138.4, a move above could see prices testing 139.1.
Aluminium yesterday settled up by 0.99% at 137.75 as recovering demand, low social inventories and high spot premiums remain supportive to prices.
Risk appetite improved on a flurry of announcements about a potential COVID-19 vaccine and expectations of more stimulus from Europe and from the US.Investors remained cautious after China kept its benchmark lending rate steady for the third straight month.
China kept its one-year and five-year loan prime rate unchanged at 3.85% and 4.65%, respectively, matching market expectations, as the world’s second-largest economy is recovering from the shock coronavirus pandemic.
Record-breaking new coronavirus cases and rising tensions between Washington and Beijing also kept investors on edge. Global primary aluminium output fell to 5.274 million tonnes in June from 5.448 million tonnes in May, data from the International Aluminium Institute (IAI) showed.
The market cheered a slew of positive news on the vaccine front. Pfizer and BioNTech reported early positive data on a joint coronavirus vaccine. Meanwhile, another candidate from Oxford University and AstraZeneca showed a positive immune response in an early trial.
Investors are also monitoring the talks in Washington on the next coronavirus relief bill. Lawmakers face pressure to pass legislation before the end of the month, when the $600 per week federal unemployment insurance benefit is set to expire.
--Aluminium trading range for the day is 135.9-139.1.
--Aluminium gained as recovering demand, low social inventories and high spot premiums remain supportive to prices.
--Investors remained cautious after China kept its benchmark lending rate steady for the third straight month.
--Global primary aluminium output fell to 5.274 million tonnes in June from 5.448 million tonnes in May.
Courtesy: Kedia Commodities