04 JUNE 2014www.commodityonline.com
Aluminium market rises on short covering, trading range 107.6-110
Edited by : AL CIRCLE
2 min read
Aluminium settled up 0.88% at 109 as prices got supported as economic indicators from the US were upbeat. The People’s Bank of China and China Banking Regulatory Commission held a meeting last Friday to arrange RRR cuts for qualified rural banks, shoring up market confidence. The official China manufacturing PMI for May advanced at its fastest pace this year to 50.8, indicating continued improvement of manufacturing sector. This encouraging news offset the negative effect from poor euro zone manufacturing data reported earlier. In other news, the US ISM admitted a mistake in its May manufacturing index estimate, and the revised index beat forecast.
Mixed economic data released and risk aversion ahead of the weekend caused the three-month aluminum on London Metal Exchange to hit a high of USD 1,860/mt last Friday before falling back. The prices then hovered at USD 1,839/mt on Monday with Chinese market closing for the country’s Dragon Boat Festival. In response, LME three-month aluminum touched a high of USD 1,860/mt before closing Monday out at USD 1,850/mt. Investors should pay special attention to the euro zone’s jobless rate for April and CPI for May, as well as US factory orders for April on Tuesday.
These economic data will have limited impact on base metals prices, with industry insiders still taking a cautious optimistic stance. Technically market is under short covering as market has witnessed drop in open interest by -0.26% to settled at 3127 while prices up 0.95 rupee, now Aluminium is getting support at 108.3 and below same could see a test of 107.6 level, and resistance is now likely to be seen at 109.5, a move above could see prices testing 110.
Trading Ideas:
--Aluminium trading range for the day is 107.6-110.
--Aluminium ended with gains as prices got supported as economic indicators from the US were upbeat.
--In the euro zone, France’s final manufacturing PMI dropped to 49.6 in May, arresting a rising stream through March to April
--Technically market is under short covering as market has witnessed drop in open interest by -0.26% to settled at 3127.
Mixed economic data released and risk aversion ahead of the weekend caused the three-month aluminum on London Metal Exchange to hit a high of USD 1,860/mt last Friday before falling back. The prices then hovered at USD 1,839/mt on Monday with Chinese market closing for the country’s Dragon Boat Festival. In response, LME three-month aluminum touched a high of USD 1,860/mt before closing Monday out at USD 1,850/mt. Investors should pay special attention to the euro zone’s jobless rate for April and CPI for May, as well as US factory orders for April on Tuesday.
These economic data will have limited impact on base metals prices, with industry insiders still taking a cautious optimistic stance. Technically market is under short covering as market has witnessed drop in open interest by -0.26% to settled at 3127 while prices up 0.95 rupee, now Aluminium is getting support at 108.3 and below same could see a test of 107.6 level, and resistance is now likely to be seen at 109.5, a move above could see prices testing 110.
Trading Ideas:
--Aluminium trading range for the day is 107.6-110.
--Aluminium ended with gains as prices got supported as economic indicators from the US were upbeat.
--In the euro zone, France’s final manufacturing PMI dropped to 49.6 in May, arresting a rising stream through March to April
--Technically market is under short covering as market has witnessed drop in open interest by -0.26% to settled at 3127.
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