Zinc yesterday traded with the positive node and settled 0.9% up at 94 on short covering after the sell-off seen on friday, as the US dollar index rose to 78, LME zinc prices dipped to a new low this year at USD 1,894/mt at noon, and then rallied to USD 1,900/mt. Finally, LME zinc prices closed at USD 1,910/mt, down USD 82/mt. Downstream buyers will increase purchases ahead of the China's National Day holiday. The European debt crisis worsened last Friday, and dimmed US economic outlook and an economic slowdown in China triggered turmoil in global financial markets, which caused LME prices to continuously set a new yearly low. There was news this morning German and French leaders last weekend were drafting plans for the Euro-zone crisis, showing stable mechanism in this region will come in ahead of time in 2012 instead of 2013, lifting the euro after the opening, which will help the US dollar index move downward. In yesterday's trading session zinc has touched the low of 93.3 after opening at 93.4, and finally settled at 94. For today's session market is looking to take support at 92, a break below could see a test of 90.1 and where as resistance is now likely to be seen at 97.2, a move above could see prices testing 100.5.

Trading Ideas:

Zinc trading range is 90.1-100.5.

Zinc yesterday traded with the positive node on short covering after the sell-off seen on friday,

Euro debt crisis worsened & dimmed US economic outlook and economic slowdown in China triggered turmoil.

Chinese stock markets closed slightly higher due to impacts of rising US equity markets.