Aluminium futures slipped on Friday, with August contracts on the Multi Commodity Exchange (MCX) trading at INR 249.30, down 0.46 per cent, after the Trump administration announced a fresh round of tariffs scheduled to take effect within a week. On the London Metal Exchange (LME), three-month aluminium contracts also declined by about 1.4 per cent to USD 2,565 per tonne.
Despite the near-term dip, analysts remain optimistic about the metal’s outlook. Ajit Mishra, Senior Vice President – Research at Religare Broking, pointed to rising Chinese demand and tightening global supply as key supportive factors. He added that progress in US–China trade negotiations and Beijing’s recent approval of a massive CNY 1.2 trillion hydroelectric dam project are likely to drive sustained industrial activity and, in turn, support demand for aluminium.
From a technical standpoint, aluminium has staged a notable rebound from its March low of INR 228, currently hovering near the INR 250 mark. Prices remain above both their 50-day and 200-day moving averages, reflecting continued bullish momentum. The recent emergence of a “golden crossover”, where the 50-day average moves above the 200-day average suggests a potential medium-term uptrend.
However, with resistance expected in the INR 255–257 range, some near-term consolidation or profit booking could emerge.
Trading strategy
Mishra advises a “buy-on-dips” approach, recommending accumulation near INR 248–250 with a stop loss below INR 241. Upside targets are pegged at INR 258 and INR 264, offering a potential gain of up to 6 per cent.
Overall, the outlook remains cautiously optimistic, with strong technical indicators and improving demand fundamentals especially from China counterbalancing tariff-related risks.
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