Aluminium yesterday traded with the negative node and settled -0.58% down at 111.35 as weak US ADP employment data for May and final 1Q GDP released overnight reignited risk aversion, helping the US dollar index return above 83 and record a new 2012 high. LME aluminum weighed by the strong US dollar, dropped below USD 2,000/mt and for the first trading day failing to return above the mark, closing down USD 16/mt or 0.8% at USD 1,994/mt. Risk aversion is strong in markets. The May PMI data and U. S. non-farm payroll data to be released today is likely to be weak, which will weigh on aluminum prices. LME aluminum will face stronger pressure at USD 2,000/mt and should move between USD 1,980-2,005/mt. Though liquidity pressure will gradually ease as June starts, goods holders' selling interest remains high due to strong bearishness. Downstream buying stays weak. Market focus has shifted to China's PMI data jointly released by the NBS and China Federation of Logistics & Purchasing, and markets expect this data to fall further, which will greatly restrict copper price movements. Coupled with the fact investors are cautious towards this evening's US nonfarm payroll report. In yesterday's trading session aluminium has touched the low of 111.15 after opening at 112, and finally settled at 111.35. For today's session market is looking to take support at 110.8, a break below could see a test of 110.3 and where as resistance is now likely to be seen at 112.2, a move above could see prices testing 113.

Trading Ideas:

Aluminium trading range for the day is 110.32-113.02.

Aluminium dropped as weak US ADP employment data and final 1Q GDP released reignited risk aversion

LME aluminum weighed by strong $, dropped below USD 2,000/mt and for first trading day failing to return above the mark

Aluminium daily stocks at Shanghai exchange came down by 897 tonnes