Aluminium market under long liquidation, open interest drops 2.28%

Aluminium settled down -0.61% at 97.75 logging small losses while LME aluminium, which has been the best LME performer this year, finished down 0.8 percent at $1,450 a tonne, the lowest since Dec. 1 last year. Prices may see support today as profits ahead of key trade data from China, but the recent onslaught of selling was expected to resume given struggling demand-growth in the world's top user of metals.

Meanwhile, metals company Alcoa Inc on Monday reported a quarterly net loss after charges related to shuttering parts of its traditional smelting business. CME Group has logged the first trades in its Japan aluminium premium contract, data from the exchange showed on Monday, just days after the industry hammered out the first quarter premiums for Asia's biggest importer of the metal. Aluminum major, Alcoa has decided to permanently shut down the alumina smelter operations at Evansville, Indiana. According to company announcement, the 269,000 metric ton Warrick Operations smelter will undergo permanent closure by end of March this year.

In addition, the company has also announced that the remaining 810,000 metric tons of refining capacity at its Point Comfort operations in Texas will be curtailed by the end of Q2 2016. The company is on target to curtail alumina production by 1 million metric tons by end of June this year. Last week Aluminum lead a rebound in base metals as Chinese equities plunged on concerns that the biggest Asian economy is worsening. Technically market is under long liquidation as market has witnessed drop in open interest by -2.28% to settled at 3816 while prices down -0.6 rupee, now Aluminium is getting support at 97.5 and below same could see a test of 97.1 level, and resistance is now likely to be seen at 98.5, a move above could see prices testing 99.1.