MCX Zinc under long liquidation; Support seen at 170.6
Commodity Online | July 23 2020
UPDATED 10:20:52 IST

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Technically Zinc market is under long liquidation as market has witnessed drop in open interest by 15.69% to settled at 1462 while prices down 3.65 rupees.

Now MCX Zinc is getting support at 170.6 and below same could see a test of 168.2 levels, and resistance is now likely to be seen at 176.4, a move above could see prices testing 179.8.

Zinc yesterday settled down by 2.07% at 172.75 as large deliveries of zinc LME warehouses, suggesting hefty surpluses and weak demand, weighed on prices.

China's central bank does not see an immediate need to ease monetary policy further, but will keep conditions accommodative to support a recovery in the world's second-largest economy.

European Union leaders agreed on a massive stimulus plan for their economies, while early data from trials of three potential coronavirus vaccines showed positive results.

Advisers to U.S. President Donald Trump and congressional Democrats were set to discuss the next steps in responding to the coronavirus crisis, with congressional Republicans saying they were working on a $1 trillion relief bill.

China's zinc and zinc alloy production fell 8.3% year-on-year to 396,000 tonnes in June, hitting its lowest monthly level since February as smelters carried out summer maintenance.

Output was down by 11,000 tonnes from a revised figure of 407,000 tonnes for May, although the daily production rate increased by 0.5%, June has one less day than May.

China’s refined zinc output fell for a second straight month in June, showed survey, as smelters in Shaanxi, Hunan and Anhui conducted maintenance as planned and as Xiangyun Feilong in Yunnan scaled back output due to equipment failure.

Trading Ideas:
--Zinc trading range for the day is 168.2-179.8.
--Zinc prices dropped as large deliveries of zinc LME warehouses, suggesting hefty surpluses and weak demand, weighed on prices.
--China's zinc and zinc alloy production fell 8.3% year-on-year to 396,000 tonnes in June, hitting its lowest monthly level since February.
--Output was down by 11,000 tonnes from a revised figure of 407,000 tonnes for May, although the daily production rate increased.

Courtesy: Kedia Commodities