Aluminium settled up 0.14% at 104.05 after hitting a fresh two-month low, as investors weighed near-term supply tightness against tepid U.S. and Chinese factory data and an emerging markets selloff. But weighing on prices U.S. manufacturing activity slowed sharply in January on the back of the biggest drop in new orders in 33 years while construction spending barely rose in December, pointing to some loss of steam in the economy. In China, factory growth eased to an expected six-month low in January, hurt by weaker local and foreign demand, heightening worries of an economic slowdown. The U.S. Federal Reserve, bolstered by long-standing signs of recovery in the world's largest economy, is reducing its huge monetary stimulus - a move that has partly prompted the bruising selloff in emerging markets. Financial markets in those countries have boomed in recent years as the Fed's measures to bolster economic growth at home - including ultra-low interest rates - encouraged investors to seek higher returns in emerging economies. China's government, meanwhile, wants to reduce reliance on the investment and exports that have fuelled economic growth in the past three decades in favour of consumption and services, which it thinks will provide lower but more sustainable growth. China, the world's largest copper consumer, is on a week-long Lunar New Year holiday which began late last week. Chinese markets will reopen on Friday. Technically market is under fresh buying as market has witnessed gain in open interest by 2.73% to settled at 4811 while prices up 0.15 rupee, now Aluminium is getting support at 103.5 and below same could see a test of 102.8 level, And resistance is now likely to be seen at 104.9, a move above could see prices testing 105.6.

Trading Ideas:

Aluminium trading range for the day is 102.8-105.6.

Aluminium prices ended with firm note on some short covering after prices dropped in last sessions due to global surplus

Market players have closely been looking out for U.S. data reports recently to gauge if they will strengthen or weaken the case for Fed to scale back stimulus

Technically market is under fresh buying as market has witnessed gain in open interest by 2.73% to settled at 4811