Zinc settled up 1.82% at 126.2 as supply tightness concerns continued to support prices. China's MMG Ltd said a new zinc mine in Australia will miss its startup date due to technical issues, potentially triggering a global supply pinch. Euro zone December CCI was down 13.6, better than expectations and Novembers' level, when combined with falling US dollar index also supported prices. Last week, the Commerce Department said that the U. S. economy expanded by 4.1% in the third quarter, well above initial estimates for 3.6% growth, adding to signs that the economic recovery is deepening. In the week ahead, the U. S. is to release key reports on durable goods orders, new home sales and jobless claims. In China, the People's Bank of China has injected over RMB 300 billion in the market via SLO last week, and excess reserves in banking system were above RMB 1.5 trillion. However, liquidity conditions remained unimproved, with major interest rates in money market staging a strong rebound after initial plunge last Friday to hit a new high since June's liquidity squeeze. Chinese stock market thus slumped over 2%.Base metals seen under pressure on Thursday in reaction to the US Federal Reserve's decision to reduce its bond buying purchases by $US10 billion in January to $US75 billion a month. Easy money policies in the US, the world's second largest copper consumer, have helped to buoy demand for industrial metals. Now Zinc is getting support at 124.7 and below same could see a test of 123 level, And resistance is now likely to be seen at 127.2, a move above could see prices testing 128.

Trading Ideas:

Zinc trading range for the day is 123-128.

Zinc ended with gains as supply tightness concerns continued to support prices.

China's MMG Ltd said a new zinc mine in Australia will miss its startup date due to technical issues, potentially triggering a global supply pinch

Zinc weekly stocks at Shanghai exchange came up by 9569 tonnes