Nickel settled up 0.58% at 1162.1 tracking gains in other base metals counter despite mixed US economic data. US housing starts fell to 893,000 in June on an annually adjusted basis, down for the second month to a low last seen in September 2013 and missing market expectations. The country’s June building permits also dwindled to 963,000, the lowest level since January.

These negative housing data suggest that the US property market is still confronted with headwinds. Meanwhile, US initial jobless claims for the week ending on July 11 dropped to a 9-week low of 302,000, a sign that the US labor market is recovering. The 4-week average of the jobless claims declined 3,000 to 309,000, a low not seen since June 2007. No rising momentum is expected to push up nickel prices for the rest of July, with resistance expected at $20,500 per tonne.

Despite supply disruption of ore, LME nickel inventories kept growing, bringing inventories up to 308,322 tonnes now, up 17.84% from the level on January 13, the first working day since the ban took effect on January 12. The continuous increase in inventories reflects weak nickel consumption. Nickel prices surged all the way since the introduction of Indonesia’s ban on unprocessed ore early this year. LME nickel prices opened at USD 19,220/mt overnight, with the high end of the price range USD 19,300/mt, and finding support at USD 19,075/mt. Finally, LME nickel prices closed at USD 19,291/mt, up USD 77/mt from the previous trading day. Now Nickel is getting support at 1150.6 and below same could see a test of 1139 level, And resistance is now likely to be seen at 1168.9, a move above could see prices testing 1175.6.

Trading Ideas:

Nickel trading range for the day is 1139-1175.6.

Nickel settled up 0.58% at 1162.1 tracking gains in other base metals counter despite mixed US economic data.

US housing starts fell to 893,000 in June on an annually adjusted basis, down for the second month to a low last seen in September 2013

Technically market is under short covering as market has witnessed drop in open interest by -8.83% to settle at 5432.