MCX Zinc under short covering; Resistance seen at 186.1
Commodity Online | August 04 2020
UPDATED 10:20:39 IST

MCX Mentha Oil likely to move in a range of 952-971.8

MCX Nickel likely to move in a range of 1089.7-1118.5

MCX Cotton under fresh buying; Support seen at 17950

MCX Zinc under long liquidation; Resistance seen at 196.7

MCX Copper under short covering; Resistance seen at 535.3

Technically Zinc market is under short covering as market has witnessed drop in open interest by 9.32% to settled at 1974 while prices up 0.5 rupees.

Now MCX Zinc is getting support at 182.6 and below same could see a test of 180.7 levels, and resistance is now likely to be seen at 186.1, a move above could see prices testing 187.7.

Zinc yesterday settled up by 0.27% at 184.5 as support seen amid robust Caixin/Markit manufacturing PMI strengthened investors’ confidence in the recovery of Chinese economy.

Prices also seen supported amid ample liquidity in global markets and the US $1.3 trillion stimulus package. Zinc inventories in China increased 6,700 mt over the weekend, and Shanghai and Tianjin were the two major contributors.

Data showed that social inventories of refined zinc ingots across Shanghai, Tianjin, Guangdong, Jiangsu, Zhejiang, Shandong and Hebei expanded 6,700 mt from July 31 to 201,900 mt as of August 3. The stocks increased 4,300 mt from Monday July 27.

Arrivals of domestic products at east China’s Shanghai increased over the weekend after the wet weather ended. Stocks in north China’s Tianjin rose slightly as rising prices curbed downstream demand.

The US dollar index slid as low as 92.54 in early trading on July 31, a level last seen in May 2018, before rebounding to close at 93.45. It has fallen nearly 5% in July, with most of the drop coming in the last 10 days as new Covid-19 cases surged across several US states and some recent data pointed to an economic recovery losing steam.

Trading Ideas:
--Zinc trading range for the day is 180.7-187.7.
--Zinc gained as support seen amid robust Caixin/Markit manufacturing PMI strengthened investors’ confidence in the recovery of Chinese economy.
--Prices also seen supported amid ample liquidity in global markets and the US $1.3 trillion stimulus package.
--Zinc inventories in China increased 6,700 mt over the weekend, and Shanghai and Tianjin were the two major contributors.

Courtesy: Kedia Commodities