MCX Zinc under fresh selling; Support seen at 202.9
Commodity Online | June 14 2019
UPDATED 09:50:19 IST

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Technically Zinc market is under fresh selling as market has witnessed gain in open interest by 0.28% to settled at 3627 while prices down 2.45 rupees.

Now MCX Zinc is getting support at 202.9 and below same could see a test of 201.9 level, And resistance is now likely to be seen at 205.4, a move above could see prices testing 206.9. 

Zinc on MCX settled down 1.19% at 203.8, as a lack of progress in resolving the U.S.-China trade tension continued to weigh on prices. A lingering trade war and rising tariffs pose threats to the health of the global economy as well as China's economic growth, ultimately hurting demand for metals.

Prices were cushioned by expectation of an interest rate cut by the U.S.Federal Reserve in the backdrop of slowing growth. U.S. President Donald Trump declined to set a deadline for levying tariffs on another $325 billion of Chinese goods and called the relationship with Beijing good but "testy" after China walked back commitments for a trade deal.

Downstream consumption from the galvanising sector weakened in May after supportive policies accelerated the release of demand in April.Higher steel prices raised costs at galvanising producers and drove them to cut production or suspend last month.

The global zinc market saw a deficit of 44,500 tonnes in March compared with a surplus of 27,600 tonnes in February, data from the International Lead and Zinc Study Group (ILZSG) showed.The US Labor Department said that its consumer price index (CPI) edged up 0.1% last month, as cheaper gasoline offset the rebound in food prices. The CPI gained 0.3% in April. On a yearly basis, the CPI increased 1.8%, slowing from April’s 1.9% gain.

Trading Ideas:
--Zinc trading range for the day is 201.9-206.9.
--Zinc dropped as a lack of progress in resolving the U.S.-China trade tension continued to weigh on prices.
--lingering trade war and rising tariffs pose threats to the health of the global economy as well as China's economic growth, ultimately hurting demand.
--Prices were cushioned by expectation of an interest rate cut by the U.S. Federal Reserve in the backdrop of slowing growth.

Courtesy: Kedia Commodities

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