MCX Zinc under long liquidation; Resistance seen at 206.3
Commodity Online | October 23 2020
UPDATED 10:20:31 IST

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Technically Zinc market is under long liquidation as market has witnessed drop in open interest by 11.05% to settled at 1585 while prices remain unchanged 0 rupees.

Now MCX Zinc is getting support at 203.1 and below same could see a test of 201.1 levels, and resistance is now likely to be seen at 206.3, a move above could see prices testing 207.5.

Zinc yesterday settled remain unchangeby 0% at 205.05 amid fears that the U.S. stimulus bill will come later than expected.The global refined zinc market, meanwhile, will see a surplus of 620,000 tonnes in 2020, and a surplus of 463,000 tonnes in 2021, the ILZSG forecast.

The pandemic has also hit mining of zinc, especially in Latin American nations as countries imposed restrictions to stem its spread, the ILZSG said, with global zinc output likely to fall by 4.4% to 12.33 million tonnes in 2020, before rising by 6.6% to 13.14 million tonnes in 2021.

The group said the 2021 increase in zinc output would "mainly be a consequence of further rises in China, India and the United States, combined with higher output in Japan, Mexico and Peru." The ILZSG had, in October last year, forecast a 55,000 tonne surplus for lead and a 192,000-tonne zinc surplus in 2020.

Survey showed that operating rates of domestic zinc concentrate stood at 67.7% in September, up 6.4 percentage points month on month and down 10.6 percentage points year on year. With the recovery of production after the maintenance of large mines in September, the output increased significantly, such as Guosen Mining and Sichuan Huidong Daliang Mining.

Trading Ideas:
--Zinc trading range for the day is 201.1-207.5.
--Zinc prices settled flat amid fears that the U.S. stimulus bill will come later than expected.
--The global refined zinc market, meanwhile, will see a surplus of 620,000 tonnes in 2020, and a surplus of 463,000 tonnes in 2021.
--The pandemic has also hit mining of zinc, especially in Latin American nations as countries imposed restrictions to stem its spread, the ILZSG said.

Courtesy: Kedia Commodities

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