Commodity Trading Tips for Aluminium by KediaCommodity

Ajay Kumar Kedia 11 February 2014

Aluminium settled down -0.71% at 104.40 remained under pressure as China's demand growth is likely to lag behind a surge in supplies. Alcoa, the third biggest aluminum producer, predicts global consumption to add 7% this year, with China's demand growing more than 11%. However, the producer still expects China's aluminum market to register a surplus of 400,000 tonnes in 2014, while rest of the world may see a deficit of 300,000 tonnes. Markets will focus on Janet Yellen's hearing late on Tuesday. This is Yellen's first hearing as chair of the Fed in which she will present her testimony on the monetary policy and US economic prospect. Markets are still dubious about whether the US Federal Reserve will carry on tapering its asset purchasing program given disappointing economic data during the past two months. Transactions for LME base metals overnight decreased, a sign of caution among investors. In Europe, French industrial output in December was down 0.3% on the month, but grew 0.5% YoY. Manufacturing output in December also increased 0.5% year-on-year, exceeding November's level. The euro zone Euro zone Sentix investor confidence rose to +13.3 in February, its highest since April 2011. These encouraging economic data revealed that the single currency bloc's economy is gradually emerging from recession, and boosted investor confidence towards its economic recovery. Technically market is under fresh selling as market has witnessed gain in open interest by 10.8% to settled at 4678 while prices down -0.75 rupee, now Aluminium is getting support at 103.8 and below same could see a test of 103.2 level, And resistance is now likely to be seen at 105.4, a move above could see prices testing 106.4.