Commodity Trading Tips for Aluminium by KediaCommodity

Ajay Kumar Kedia 13 February 2014

Aluminium settled up 0.76% at 105.40 as better-than-expected China trade data boosted market sentiment. China foreign trade growth released in Wednesday morning handily exceeded forecasts during January, with imports up 10.0% and exports up 10.6% from a year ago. These encouraging trade data alleviate market concerns over the weakening of China's metal demand. The Senate overnight voted 55-43 to pass a suspension of the limit on federal borrowing after a narrow vote in the House of Representatives on Tuesday. The measure later will be sent to President Barack Obama for signature, and after that the US government's borrowing authority will be extended until March 2015. In addition, Federal Reserve Bank of St. Louis President James Bullard showed a bullish stance on US economy in his comments. As to statistics, the US government's budget deficit report revealed that the nation's deficit reached USD 10.4 billion during January, well below market expectations for USD 30.8 billion. Meanwhile, comments from Federal Reserve Chair Janet Yellen continued to support sentiment. In her first congressional testimony on Tuesday, Fed Chair Yellen said that the central bank would taper the pace of its asset purchases at future meetings if the economy continued to improve as expected. She added that the pace of the central bank's bond purchases are not on a "preset course", while reiterating that Fed plans to hold interest rates at zero "well past" the time the jobless rate falls below 6.5%. Technically market is under short covering as market has witnessed drop in open interest by -9.77% to settled at 4091 while prices up 0.8 rupee, now Aluminium is getting support at 104.9 and below same could see a test of 104.2 level, And resistance is now likely to be seen at 106.1, a move above could see prices testing 106.6.