Nickel settled down -1.11% at 1070 sank to its lowest price in about two months on Thursday on persistent profit-taking after months of rallying on an Indonesian ban on ore exports in January. LME Nickel, up 30 percent so far in 2014, has been by far the best performing base metal after top producer Indonesia imposed a ban on shipments of unprocessed ore in January. It hit a 27-month peak of $21,625 a tonne on May 13. Meanwhile Vale SA’s New Caledonian Nickel Plant, holder of the second biggest reserves in the world is all set to resume the nickel production within 10 days, followed by a permission granted by the government to restart the plant operations. A Toronto based spokesman, Cory McPhee said that the facility would restart in a step by step manner. The operations at the plant have been put on hold after an issue of acid spillage in the plant. On May 30, company said that it had received the permission to restart, According to the U.S. Geological Survey, New Caledonia in the Pacific Ocean have around 16 % of the global reserves, second position goes to Australia. Rusal reported that the rally in nickel prices as a part of Indonesian ore export had caused investors to reconsider the effects of reduced Indonesian exports of bauxite in the light metal industry. Technically market is under fresh selling as market has witnessed gain in open interest by 11.14% to settled at 7430 while prices down -12 rupee, now Nickel is getting support at 1050.7 and below same could see a test of 1031.4 level, And resistance is now likely to be seen at 1085.9, a move above could see prices testing 1101.8.

Trading Ideas:

Nickel trading range for the day is 1031.4-1101.8.

Nickel dropped on profit-taking after months of rallying based on expectations that an Indonesian ban on exports would lift physical market.

Iraq's turmoil pushed up global oil prices, and growing risk aversion weighed down base metals prices.

The ongoing investigation at the Port of Qingdao and escalating tensions in Iraq should stoke uncertainties in base metals markets