MCX Zinc under fresh buying; Resistance seen at 184.4
Commodity Online | July 30 2020
UPDATED 10:20:13 IST

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Technically Zinc market is under fresh buying as market has witnessed gain in open interest by 12.5% to settled at 2205 while prices up 3.4 rupees.

Now MCX Zinc is getting support at 180 and below same could see a test of 177.1 levels, and resistance is now likely to be seen at 184.4, a move above could see prices testing 185.9.

Zinc yesterday settled up by 1.9% at 182.8 amid positive industrial data and government stimulus pointed to rising demand.

Deliveries of zinc to London Metal Exchange registered warehouses in places such as Port Klang, Malaysia and Singapore, not typical destinations, suggest an unusually large surplus of the metal used to galvanise steel.

Overall stocks of zinc in LME warehouses at 173,000 tonnes are more than three times the levels seen in early February and at their highest since October 2018.

In Singapore, inventories have surged to 50,675 tonnes from 16,875 tonnes at the end of March and in Port Klang the number stands at 20,700 tonnes from zero.Zinc inventories in China fell over the weekend, primarily in Shanghai as inflows of imported materials were limited.

Data showed that social inventories of refined zinc ingots across Shanghai, Tianjin, Guangdong, Jiangsu, Zhejiang, Shandong and Hebei decreased 1,300 mt from last Friday July 24 to 205,100 mt as of Monday July 27.

The stocks were down 7,500 mt from last Monday July 20. Compared to last Friday, social inventories of refined zinc across the three major trading hubs (Shanghai, Tianjin and Guangdong) fell 1,000 mt.

Trading Ideas:
--Zinc trading range for the day is 177.1-185.9.
--Zinc prices gained amid positive industrial data and government stimulus pointed to rising demand.
--Deliveries of zinc to London Metal Exchange registered warehouses suggest an unusually large surplus of the metal used to galvanise steel.
--Zinc inventories in China fell over the weekend, primarily in Shanghai as inflows of imported materials were limited.

Courtesy: Kedia Commodities