Nickel settled up 2.01% at 1181.4 as economic growth in China is set to improve, helped by easing and stronger export markets. Global supply will exceed demand by 44,200 tons in 2014 before shifting to a deficit of 97,100 tons in 2015, the first annual shortfall since 2010. Nickel ore and concentrate imports into China have slumped 36 percent this year, the bank said. China’s nickel pig iron output will drop to 388,000 tons in 2014 and to 212,000 tons in 2015 from 472,000 tons in 2013. Nickel inventories monitored by the London Metal Exchange rose have advanced 17 percent this year. Refined metal production will exceed demand by 44,200 tons this year, Morgan Stanley estimated in a report. In Europe, trade data in Germany outstripped April’s reading and expectations in May, but that in France came in disappointing. UK manufacturing output grew by 3.7% YoY in May, missing a 4.4% rise in April and the expected 5.6% increase, while the country’s industrial output rose by 2.3%, short of April’s reading and forecasts. Meanwhile, shares in Commerzbank, Germany’s second-largest bank, fell on Tuesday after news that it could suffer at least USD 500 million in penalties. LME nickel prices opened at USD 19,350/mt overnight, with the high end of the price range USD 19,800/mt, and finding support at USD 19,242/mt. Finally, LME nickel prices closed at USD 19,726/mt, up USD 397/mt from the previous trading day.  Technically market is under fresh buying as market has witnessed gain in open interest by 17.22% to settled at 7374 while prices up 23.3 rupee, now Nickel is getting support at 1159.4 and below same could see a test of 1137.3 level, And resistance is now likely to be seen at 1195.8, a move above could see prices testing 1210.1.

Trading Ideas:

Nickel trading range for the day is 1137.3-1210.1.

Nickel gained as economic growth in China is set to improve, helped by easing and stronger export markets.

Global supply will exceed demand by 44,200 tons in 2014 before shifting to a deficit of 97,100 tons in 2015, the first annual shortfall since 2010.

Nickel inventories monitored by the London Metal Exchange rose have advanced 17 percent this year.