Aluminium on MCX settled down -0.35% at 126.8 on profit booking tracking LME aluminium closed down 0.5 percent at $1,962.50 a tonne, but still posted its biggest quarterly gain in 6-1/2 years, up nearly 16 percent. The metal hit its highest since December 2014 on Thursday ahead of the Chinese manufacturing data. Meanwhile LME stocks of aluminum sank below the 2 million-tonne level earlier this month and at a current 1,886,400 tonnes are at their lowest since December 2008. Excluding the metal that is awaiting load-out, the on-warrant total of 1,003,275 tonnes is the lowest since May 2008. Japan's quarterly premiums, which act as a benchmark across much of the Asian region, are in part a reflection of local market conditions. It's worth noting that regional supply has taken two hits recently. Activity in China's manufacturing sector unexpectedly grew at its fastest pace in nearly five years in March, adding to evidence that the world's second-largest economy has gained momentum early this year, an official report showed. That's not to say that the aluminum market isn't shifting towards a state of supply deficit, just to note that LME stocks are a poor way of quantifying any shortfall. Commodity consultants CRU, for example, estimate that the supply deficit outside of China increased from 194,000 tonnes in 2015 to 821,000 tonnes last year. Technically market is under fresh selling as market has witnessed gain in open interest by 3.25% to settled at 3680 while prices down -0.45 rupees, now Aluminium is getting support at 126.3 and below same could see a test of 125.7 level, And resistance is now likely to be seen at 127.6, a move above could see prices testing 128.3.

Trading Ideas:

# Aluminium trading range for the day is 125.7-128.3.

# Aluminium dropped on profit booking tracking LME prices closed down 0.5 percent at $1,962.50 a tonne, but still posted its biggest quarterly gain in 6-1/2 years.

# LME stocks of aluminum sank below the 2 million-tonne level earlier in month and at current 1,886,400 tonnes are at their lowest since December 2008.

# Japan's quarterly premiums, which act as a benchmark across much of the Asian region, are in part a reflection of local market conditions.