Aluminium settled 0.44% up at 113.05 gains seen after Alcoa's Q4 earnings report shows that the company posted better than expected profits in 4Q following a loss-making Q3. Meanwhile, Alcoa is optimistic towards consumption growth in 2013. In response, aluminum staged a strong rally overnight, breaking resistance at 114.20 to a high of 114.40. However, aluminum trimmed some gains and retreated below all moving averages at the tail of trading as investors took profits prior to the release of China's trade figures. Finally, aluminum closed at 113.05 higher at +0.44% . Latest LME aluminum inventories decreased 10,025 mt to 5,196,650 mt. Market is awaiting China's December trade figures. Overall market sentiment remained subdued amid uncertainty over the ongoing US debate about raising the debt ceiling. Investors also remained cautious ahead of Thursday's ECB policy setting meeting. The ECB was widely expected to hold off cutting rates, but some market participants expected the bank to flag the possibility of rate cuts later in the year. Another closely watched development will be the Bank of England's monthly announcement on its key interest rate, also due Thursday. For today's session market is looking to take support at 112, a break below could see a test of 110.9 and where as resistance is now likely to be seen at 114.3, a move above could see prices testing 115.5.

Trading Ideas:

Aluminium trading range for the day is 110.88-115.48.

Aluminium settled up after Alcoa's Q4 earnings report shows that the company posted better than expected profits in 4Q

Aluminum staged a strong rally overnight, breaking resistance at 114.20 to a high of 114.40.

Overall sentiment remained subdued amid uncertainty over the ongoing US debate about raising the debt ceiling.