Aluminium settled down -0.41% at 120.85 on concerns about global growth after Chinese officials warned that the economy was vulnerable to more weakness. Global aluminium premiums are expected to reach fresh record highs by mid-2015 on a supply deficit in the United States and Europe. The Chinese economy faces downward pressure next year, state media cited the government as saying after its Central Economic Work Conference. Authorities also said China's monetary policy would not be too tight or too loose, giving little direction to investors hoping for another interest rate cut. US initial jobless claims for the week ending December 5 came in at 294,000, fewer than expectations, boosting expectation for an earlier-than-anticipated rate hike by the Federal Reserve. The US Commerce Department reported that retail sales grew 0.7% MoM in November, the highest monthly increase in 8 months and well above expectations. LME aluminum dropped to USD 1,945/mt after opening Thursday at USD 1,961/mt. Inflation data in France and Germany were mild. The ECB launched second round of TLRO, reflecting weak European economy. Positive US employment and retail sales data strengthened expectations for an early interest rate hike, pushing the US dollar index up. Finally, LME aluminum ended at an intraday low of USD 1,945/mt. Technically market is under long liquidation as market has witnessed drop in open interest by -0.58% to settled at 3771 while prices down -0.5 rupee, now Aluminium is getting support at 120.5 and below same could see a test of 120 level, And resistance is now likely to be seen at 121.5, a move above could see prices testing 122.

Trading Ideas:

Aluminium trading range for the day is 120-122.

Aluminium dropped on concerns about global growth after Chinese officials warned that the economy was vulnerable to more weakness.

Global aluminium premiums are expected to reach fresh record highs by mid-2015 on a supply deficit in the US and Europe.

Aluminium daily stocks at Shanghai exchange came down by 1174 tonnes.