Commodity Trading Tips for Aluminium by Kedia Commodity

Aluminium on MCX settled up 0.84% at 126.7 tracking LME prices gaining by 1.10 percent as supply issues dominated the market. Chinese inventories of aluminium look set to continue to increase over the coming weeks as physical fundamentals in China remain slack. A major aluminium producer has made an indicative offer of a premium of $125 per tonne to Japanese buyers for April-June primary metal shipments, up 32 percent from the last quarter. The latest report published by the World Bureau of Metal Statistics (WBMS) indicates that global primary aluminum market has recorded deficit during the entire 12-month period in 2016. As per the report, the market reported a deficit of 985,000 tons when matched with the deficit of 659,000 reported for the entire year 2015. The production of primary aluminum has increased by 421,000 tonnes during the entire year 2016. The total reported stock of metal increased by 115,000 tonnes during the month of December 2016. The stocks at the end of the year stood at 2,761kt, which is sufficient to meet 17 days demand. It must be noted that the stock levels at the end of 2015 had stood at 3,787 kt. The combined stocks held in London, Shanghai, USA and Tokyo exchanges totaled 2,324.2kt at the end of December 2016, down by 908 kt when matched with end-2015 levels. Technically market is under fresh buying as market has witnessed gain in open interest by 16.34% to settled at 1730 while prices up 1.05 rupees, now Aluminium is getting support at 125.8 and below same could see a test of 124.7 level, And resistance is now likely to be seen at
127.4, a move above could see prices testing 127.9.

Trading Ideas

# Aluminium trading range for the day is 124.7-127.9.

# Aluminium prices gained tracking LME prices gaining by 1.10 percent as supply issues dominated the market

# Chinese inventories of aluminium look set to continue to increase over the coming weeks as physical fundamentals in China remain slack.

# Euro zone consumer confidence fell in February in both the euro zone and the wider European Union, figures released on Monday showed.