Commodity Trading Tips for Zinc by Kedia Commodity

Ajay Kumar Kedia 2 August 2013

zinc Zinc yesterday settled flat at 111.85 as sentiments improved tracking LME zinc prices after China's official PMI for July was 50.3, topping June's level, helping ease market concerns. LME zinc prices thus edged up to USD 1,850/mt, and then hovered around USD 1,855/mt. PMIs from euro zone, Italy and UK in July all recorded above 50. In response, LME zinc prices climbed further and touched USD 1,875.3/mt. US initial jobless claims data last week and PMI turned out to be positive, which raised market apprehension that the US Federal Reserve will taper off QE3 if US non-farm employment data is upbeat. LME zinc prices rolled back some gains, and finally closed at USD 1,854/mt, up USD 9.3/mt. Menawhile Positive US economic data overnight boosted financial markets. The number of US initial jobless claims last week was 326,000, unexpectedly falling to a five-year low, and when combined with better-than-forecast US ADP employment data, US non-farm employment data to be released today is optimistic; US ISM manufacturing index hit a 2-year high of 55.4, higher than 52 expected and 50.9 in June, and new order index and employment index were also upbeat, showing US manufacturing is recovering. The Standard & Poor's 500 Index hit a record high, breaking through 1,700 for the first time, and Nasdaq Composite Index also hit a 13-year high. Also Bank of England and European central bank maintained interest rates unchanged, but euro zone July manufacturing PMI was 50.3, compared to the forecast and June's 50.1. This increased market concerns over euro zone economic recovery and pushed up European stocks. Technically market is under long liquidation as market has witnessed drop in open interest by -5.65% to settled at 2970 while prices down -0.1 rupee, now Zinc is getting support at 111.20 and below same could see a test of 110.50 level, And resistance is now likely to be seen at 112.60, a move above could see prices testing 113.40.