Chana settled up 0.49% at 2876 as prices recovered on short covering after prices dropped due to ample supplies in the domestic market. However, the losses were capped by firm spot market demand on lower level buying amid weak rainfall may hamper rabi sowing. Chana arrival at 15 trucks where as it is usually around 40-45 trucks per day. India's monsoon has covered the entire country, the weather office said, two days behind the normal schedule in a year that is forecast to bring below-average rains.

The revival of monsoon rains in the grain bowl of northwest and central regions should help speed up sowing of main summer crops such as corn. Poor rains since the start of the June-September season had raised concerns of a first drought in five years. Rains are vital to India's farm sector, which accounts for about 14 percent of the country's nearly $2 trillion economy. Two-thirds of its 1.2 billion population live in rural areas. The latest kharif data suggested that kharif pulses sowing has been completed in 7.50 lakh hectares as on 4 July 2014, down 59% from the last year in the same period.

This has incited the chana traders to reduce their supplies in physical mandies with the anticipation of better demand in the coming days. Pulses acreage fell to 1.34 million hectare until July 11 from 4.31 million hectare a year ago, showed government data. In Delhi spot market, chana dropped by -39.3 rupee to end at 2850 rupee per 100 kgs. Technically market is under fresh buying as market has witnessed gain in open interest by 2.62% to settled at 161880 while prices up 14 rupee, now Chana is getting support at 2849 and below same could see a test of 2825 level, And resistance is now likely to be seen at 2891, a move above could see prices testing 2909.

Trading Ideas:

Chana trading range for the day is 2825-2909.

Chana gained as prices recovered on short covering after prices dropped due to ample supplies in the domestic market.

However, the losses were capped by firm spot market demand on lower level buying amid weak rainfall may hamper rabi sowing.

NCDEX accredited warehouses chana stocks dropped by 1236 tonnes to 122418 tonnes.

In Delhi spot market, chana dropped by -39.3 rupee to end at 2850 rupee per 100 kgs.