Commodity Trading Tips for Zinc by KediaCommodity

Ajay Kumar Kedia 25 August 2014

zinc Zinc settled down -0.53% at 141.85 as caution over China's stuttering property markets kept traders cautious. Pressure seen after the US dollar rose as US Fed Chair Yellen's speech last Friday sent a hawkish tone, dragging LME prices down. Besides, markets continued to digest downbeat economic data from China and Europe, also pressuring LME. Surging Chinese zinc exports risk undermining price gains that have set the metal up for its biggest advance in five years. China's refined zinc shipments rose to the highest since April 2011 in July as prices reached an almost three-year high. The country's imports of the metal fell last month and the premium Chinese buyers pay to obtain zinc dropped the most since September 2012. Zinc has rallied 15 percent this year, set for the largest gain since 2009, making it the third-best performer on the London Metal Exchange. China's refined zinc exports almost tripled to 10,052 metric tons in July, a fourth straight monthly increase and following an almost 10-fold surge in June, customs data showed. This year's exports are already four times the total in 2013, while July imports, at 41,681 tons, are 54 percent below a 4 1/2-year high set in January, data showed. Meanwhile, European Central Bank President Mario Draghi stated that the euro weakened following a series of stimulus measures adopted in June, helping boost demand in the euro zone. He also called for eurozone fiscal policy to be more flexible, more spending as well as structural reforms. Technically market is under long liquidation as market has witnessed drop in open interest by -10.61% to settled at 4608 while prices down -0.75 rupee, now Zinc is getting support at 141.2 and below same could see a test of 140.5 level, And resistance is now likely to be seen at 142.9, a move above could see prices testing 143.9.