Nickel settled up 1.13% at 1149.90 rallied to its highest in more than a week on Thursday after China's factory sector grew at the fastest clip in 18 months in July, shrugging off news that Indonesia may soon resume ore exports that could smooth out kinks in supply. China is the world's biggest metal user, but slowing growth in manufacturing and property has dragged on the demand outlook for the metal while a surplus is expected to seep into the market in the second half of the year. A raft of government stimulus helped to propel the HSBC/Markit Flash China Manufacturing Purchasing Managers' Index to 52.0 in July from June's final reading of 50.7, beating a forecast. Also the IMF now forecasts the global economy to grow by 3.4% in 2014, down 0.3 ppt from the IMF's April 2014 forecasts. The downward revision reflects the "legacy of the weak first quarter, particularly in the US, and a less optimistic outlook for several emerging markets". The lift in China's manufacturing measure should alleviate concerns that China's commodity demand will deteriorate markedly this year. Market expect China's commodity demand to ease in 2H14 as China's government continues to encourage a consumption-led economy but not to the extent that many have postulated recently. It is appearing increasingly unlikely, particularly given the overall health of China's labour sector and success of targeting specific sectors, that China will enact significant stimulus this year, which would have had strong positive implications for commodity demand and prices. Now Nickel is getting support at 1141.5 and below same could see a test of 1133 level, And resistance is now likely to be seen at 1156.5, a move above could see prices testing 1163.

Trading Ideas:

Nickel trading range for the day is 1133-1163.

Nickel gained after data showed HSBC's July PMI for China hit an 18-month high of 52%, pushing up prices.

A series of PMI reports for July in the euro zone beat expectations and June's readings even as France's service PMI was reported at 47.6,

UK's Q2 GDP and US durable goods orders in June will be released today, which is optimistic.