Commodity Trading Tips for Aluminium by KediaCommodity

Ajay Kumar Kedia 9 July 2014

Aluminium settled up 0.74% at 115.3 as the Organisation for Economic Co-operation and Development indicated rosy outlook for the US economy in its economic report. Alcoa Inc has increased its estimate for the global aluminium market deficit this year due to capacity cuts in China. The U.S. aluminum producer expects demand to outpace supply by 930,000 tonnes this year, up from its previous estimate of 730,000 tonnes. The forecast would not include the more than 5 million tonnes stored in London Metal Exchange-registered warehouses and a similar tonnage of off-market inventory estimated to be held outside of the LME network. Those stockpiles have cast a long shadow over the global primary aluminum market, pressuring exchange prices to levels close to or below breakeven for many big smelters in recent years. The Job Openings & Labor Turnover Survey (JOLTs) for May revealed that job openings in the US increased to 4.64 million, beating the expected 4.35 million and up from 4.46 million in April. The job opening rate rose to 3.2%, its refreshed high since August 2007, while the quits rate was unchanged at 1.8% in May. The hires rate, however, fell to 3.4% in May, with its April reading revised to 3.5%. These relatively positive jobs report raised expectations for the US Federal Reserve to hike interest rates earlier than expected. Three-month aluminum on the London Metal Exchange jumped to USD 1,950/mt on Tuesday after opening at USD 1,920/mt. Technically market is under fresh buying as market has witnessed gain in open interest by 6.33% to settled at 6820 while prices up 0.85 rupee, now Aluminium is getting support at 114.4 and below same could see a test of 113.4 level, And resistance is now likely to be seen at 116, a move above could see prices testing 116.6.