Nickel settled at 1115.70 initially dropped below 1080 again after stockpiles of the metal surged the most in more than five years to a record, easing supply concerns. Inventories tracked by the LME jumped 6.7 percent to 305,970 metric tons, leaving stocks up 17 percent this year, bourse data show. Through yesterday, prices climbed 38 percent this year amid concern that demand will exceed production after Indonesia, the world’s biggest producer from mines, banned raw-ore exports in January. Stocks of nickel swelled on deliveries to warehouses in Rotterdam, Singapore and Malaysia’s Johor. Open interest, or the aggregate number of futures contracts yet to be closed, liquidated or delivered, rose to a record on May 13, data show. Buying and selling of nickel futures and options jumped 79 percent last month from a year earlier, according to LME data this week. Base metals markets should continue to digest optimistic statements made by the Chinese Premier, and a weaker US dollar is also expected to lend some support to the markets on Friday. The Chinese Premier Li Keqiang revealed during a visit to Britain that the central government would ensure a 7.5% economic growth this year. Meanwhile, the US Federal Reserve signaled at the mid-year interest rate meeting that it would stick to accommodative monetary policy in the long run. In response, base metals prices recouped early losses during European and US trading hours, and went up. Technically market is getting support at 1083.8 and below same could see a test of 1052 level, And resistance is now likely to be seen at 1134.7, a move above could see prices testing 1153.8.

Trading Ideas:

Nickel trading range for the day is 1052-1153.8.

Nickel prices came under pressure from a build-up in stockpiles.

Nickel stocks in LME-registered warehouses surged by 19,242 tonnes across diverse locations in Asia to a record high on Wednesday

The rise in stocks reminded investors that a ban on unprocessed ore by Indonesia, which spurred 35% gains this year, has not yet hit the refined market.