MCX Zinc under short covering; Resistance seen at 231.2
Commodity Online | April 22 2021
UPDATED 10:20:59 IST

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MCX Nickel likely to move in a range of 1304.7-1343.7

MCX Zinc under fresh buying; Resistance seen at 237.8

MCX Copper under fresh buying; Support seen at 790.6

Technically Zinc market is under short covering as market has witnessed drop in open interest by 9.61% to settled at 1562 while prices up 1.25 rupees.

Now MCX Zinc is getting support at 228 and below same could see a test of 226.5 levels, and resistance is now likely to be seen at 231.2, a move above could see prices testing 232.9.

Zinc yesterday settled up by 0.55% at 229.35 as weaker US dollar and US Treasury yields and US new housing starts in March that registered a new high in 15 years supported prices.

Resumption across domestic zinc mines and the arrival of imported zinc concentrate will ease domestic tight supply of zinc concentrate. Zinc social inventories extended declines last Friday.

Data showed that social inventories of refined zinc ingots across Shanghai, Tianjin, Guangdong, Jiangsu, Zhejiang, Shandong and Hebei decreased 8,100 mt in the week ended April 16 to 220,700 mt.

The stocks fell 11,900 mt from Monday April 12. Stocks in Shanghai decreased due to increasing purchase volume of the downstream at low prices. In south China's Guangdong, outbound cargoes rose sharply and arrivals also increased, which led to the slight decrease in stocks.

Stocks in Tianjin fell sharply as downstream restocking demand increased when zinc prices fell and the maintenance of smelters in Inner Mongolia affected arrivals.

Inventories of finished products at zinc smelters fell 13,350 mt from a month ago to 30,200 mt in March, including 19,400 mt of zinc ingots and 10,800 mt of zinc alloy, according to survey.

Trading Ideas:
--Zinc trading range for the day is 223.7-230.9.
--Zinc prices gained as the dollar wallowed near a six-week low as U.S. bond yields have hovered below a 14-month peak touched last month.
--China kept the one-year loan prime rate (LPR) unchanged at 3.85% and five-year LPR at 4.65%.
--The U.S. Federal Reserve reiterated its view that any spike in inflation was likely to be temporary.

Courtesy: Kedia Commodities
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