Zinc yesterday settled down -0.35% at 112.35 edged lower on Wednesday, as investors re-examined expectations on how soon the Federal Reserve may start to pull back its asset purchase program. Appetite for the industrial metal weakened amid concerns the Federal Reserve will taper its bond-buying program in the coming months. A government report showed on Tuesday that the U. S. trade deficit narrowed by 22.4% to a seasonally adjusted USD34.2 billion in June, the lowest level since October 2009. Investors have closely been looking out for U. S. data reports recently to gauge if they will strengthen or weaken the case for the Fed to reduce its bond purchases. Any improvement in the U. S. economy was likely to reinforce the view that the central bank will begin to taper its bond purchase program in the coming months. Also Tuesday, Chicago Fed President Charles Evans said he expected the central bank to begin tapering its asset-purchase program by the end of the year. The Fed's stimulus program is viewed by many investors as a key driver in boosting the price of commodities as it tends to depress the value of the dollar. Traders now looked ahead to data scheduled for later in the week on China's trade balance as well as a report on inflation and industrial production, amid ongoing concerns over the Asian nation's economic outlook. Technically market is under fresh selling as market has witnessed gain in open interest by 1.47% to settled at 3040 while prices down -0.4 rupee, now Zinc is getting support at 111.610 and below same could see a test of 110.80 level, And resistance is now likely to be seen at
113.10, a move above could see prices testing 113.60.

Trading Ideas:

Zinc trading range for the day is 110.9-113.7.

Zinc dropped as markets remaimed cautious after two Fed officials hinted policy makers are considering scaling back of QE3

Bank of England (BOE) President's statement enhanced expectations that the BOE will implement tightening policies

Zinc daily stocks at Shanghai exchange came down by 350 tonnes