Commodity Trading Tips for Nickel by KediaCommodity

Ajay Kumar Kedia 9 June 2014

Nickel Nickel settled down -1.13% at 1111.10 as market is under long liquidation despite of the Indonesian government’s ban on exports of unprocessed ores, which came into effect in January of this year. The threat of the ban had little advance influence on nickel values, as speculators were unsure how firm the government’s stance would be. Even after the ban came into effect, there was no panic among commodities traders, as observers remarked upon the stockpiles of nickel ore held by processors, particularly in China. Furthermore, LME nickel inventories continued to run at historically high levels. However, the upward pressure on nickel values became stronger as market players assessed the medium-term repercussions of the ban. Both technical and fundamental factors pointed to positive movements and the upswing in nickel prices accelerated. As the Indonesians had hoped, a number of nickel processing plants are planned or already under construction in the country. In the short term, however, Chinese nickel pig iron production is predicted to fall by around 100,000 tons, this year, and possibly twice that amount in 2015. Consequently, the global surplus in nickel will be cut drastically in 2014 and may even move into deficit next year. While Russia and New Caledonia, may reduce exports this year. Russia may become a subject of additional sanctions, while New Caledonia faces losses from riots. Damages to Vale mine may reach up to $30 million; production at one of biggest mines in New Caledonia was suspended on May 7 after a chemical spill into a local river. Now Nickel is getting support at 1093.6 and below same could see a test of 1076 level, And resistance is now likely to be seen at 1129.8, a move above could see prices testing 1148.4.