03 JUNE 2014www.commodityonline.com
Aluminium may trade 106.2-110 range, support at 107.1
Edited by : AL CIRCLE
2 min read
Aluminium settled up 0.37% at 108.05 amid indications that supply of the metal is constrained. Aluminium was on track for its biggest monthly rise since February on the back of healthy demand, but further prices gains were limited due to high stocks levels. Aluminum prices may come under downward pressure due to growing supply expectations against the closing of peak-demand season. The aluminum oversupply will be offset by strong demand growth outlook, lending support to aluminum prices in 2015. The addition of capacities in the Middle East and China has lead to surplus in aluminum market.
Aluminum production by China grew 6% in 2013. The production growth is expected to reach 10% in China this year. Industry data revealed that the Chicago purchasing managers' index rose to a seven-month high of 65.5 in May, from 63.0 in March, confounding expectations for a fall to 61.0. The Bureau of Economic Analysis reported that the U.S. economy contracted 1.0% in the first quarter after a preliminary estimate showed growth of 0.1%.Market expectations had been for a 0.5% contraction. It was the first decline in U.S. GDP since the first quarter of 2011, and the dollar softened on the news, reminding investors that even when the Federal Reserve winds down stimulus programs, rate hikes won't come for some time afterwards.
Elsewhere, the Commerce Department reported that personal spending in the U.S. fell 0.1% last month, compared to expectations for a 0.2% rise. Technically market is under fresh buying as market has witnessed gain in open interest by 126.19% to settled at 3135 while prices up 0.4 rupee, now Aluminium is getting support at 107.1 and below same could see a test of 106.2 level, and resistance is now likely to be seen at 109, a move above could see prices testing 110.
Trading Ideas:
--Aluminium trading range for the day is 106.2-110.
--Aluminium settled up by 0.37% amid indications that supply of the metal is constrained.
--Aluminium was on track for its biggest monthly rise since February on the back of healthy demand, but gains were limited due to high stocks levels.
--Aluminum weekly stocks at Shanghai exchange came down by 1567 tonnes.
Aluminum production by China grew 6% in 2013. The production growth is expected to reach 10% in China this year. Industry data revealed that the Chicago purchasing managers' index rose to a seven-month high of 65.5 in May, from 63.0 in March, confounding expectations for a fall to 61.0. The Bureau of Economic Analysis reported that the U.S. economy contracted 1.0% in the first quarter after a preliminary estimate showed growth of 0.1%.Market expectations had been for a 0.5% contraction. It was the first decline in U.S. GDP since the first quarter of 2011, and the dollar softened on the news, reminding investors that even when the Federal Reserve winds down stimulus programs, rate hikes won't come for some time afterwards.
Elsewhere, the Commerce Department reported that personal spending in the U.S. fell 0.1% last month, compared to expectations for a 0.2% rise. Technically market is under fresh buying as market has witnessed gain in open interest by 126.19% to settled at 3135 while prices up 0.4 rupee, now Aluminium is getting support at 107.1 and below same could see a test of 106.2 level, and resistance is now likely to be seen at 109, a move above could see prices testing 110.
Trading Ideas:
--Aluminium trading range for the day is 106.2-110.
--Aluminium settled up by 0.37% amid indications that supply of the metal is constrained.
--Aluminium was on track for its biggest monthly rise since February on the back of healthy demand, but gains were limited due to high stocks levels.
--Aluminum weekly stocks at Shanghai exchange came down by 1567 tonnes.
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