Nickel settled up 0.73% at 942.80 continuous with the last week's rally seen after 2Q GDP reports from Germany, France and euro zone show continued growth, boosting European stock prices to move higher. China's economic data was also upbeat, with new RMB loans growing sharply and power consumption up 8.8% YoY, news which pushed up Chinese stock prices and boosted market sentiment. In this context, commodity prices gained around, with crude oil and gold prices rebounding. US retail sales also rose for a fourth straight month in July, causing the US dollar index to rise initially, but later falling back supported LME Nickel price which made strong gains. A raft of upbeat Chinese economic indicators raised anticipation over growing demand in China, driving commodity prices higher. The Shanghai Composite Index rose, providing upward momentum to base metals in China. Also many smelters in China cut production for facility maintenance, tightening supply. Also Jinchuan Group hiked nickel ex-works price three times last week. Growing demand for NPI from stainless steel mills helped push up demand for refined nickel. With the price gap between the two growing, downstream demand for refined nickel improved slightly. Traded prices for Jinchuan nickel were between RMB 103,100 - 103,500/mt, and RMB 102,100 - 102,400/mt for Russian nickel, a difference of only RMB 1,000-1,100/mt. Technically market is under short covering as market has witnessed drop in open interest by -8.93% to settled at 4527 while prices up 6.8 rupee, now Nickel is getting support at 928.1 and below same could see a test of 913.3 level, And resistance is now likely to be seen at 952.6, a move above could see prices testing 962.3.

Trading Ideas:

Nickel trading range for the day is 913.3-962.3.

Nickel gained as prices boosted after a raft of upbeat global economic data fuelled hopes for higher demand for the metal.

Rising housing prices in China in July have painted a rosy picture of growing metal demand from property sector

Several Fed officials said last week the Fed will likely begin to scale back QE3 in September.