Aluminium yesterday settled up by 0.94% at 102 as support seen after US home prices jumped 10.9% in March compared with a year ago, the highest level in seven years. The Conference Board's Consumer Confidence Index rose to 76.2 in May. These positive data are a sign of sustained improvement in the US economy, but also raised worries that the US Federal Reserve will scale back QE3 soon. In response, US shares and US dollar index both rose, eating into gains of base metals. LME aluminum rose, but failed to touch the 20-day moving average, with the high-end price at USD 1,861/mt. Finally, LME aluminum closed at USD 1,851/mt, up 0.65%. Latest LME aluminum inventories decreased 225 mt to 5,213,050 mt. A firm US dollar will keep aluminum prices in check. Traders are now looking ahead to the release of U. S. economic reports later in the day, as well as Chinese data slated for later in the week. Meanwhile, the next slice of Chinese economic data to come out will be the official purchasing managers' index due on Saturday. Technically market is under short covering as market has witnessed drop in open interest by -14.01% to settled at 4462 while prices up 0.95 rupee, now Aluminium is getting support at 101.08 and below same could see a test of 100.10 level, And resistance is now likely to be seen at 102.63, a move above could see prices testing 103.20.

Trading Ideas:

Aluminium trading range for the day is 100.17-103.27.

Aluminium ended higher as stronger U. S. economic data and a rally in equities fanned hopes of greater demand.

Total world aluminum inventories in April this year fell by 29,000 metric tons on-month to 2.296 million tons - IAI

Aluminium daily stocks at Shanghai exchange came down by 551 tonnes