Aluminium yesterday traded with the positive node and settled 1.74% up at 109.1 trackintg LME aluminum prices opened at USD 2,020/mt overnight supported by better-than-expected Purchasing Managers' Index (PMI) in China and Europe. Later, inspiring US manufacturing data and significantly weakening US dollar index helped push up LME aluminum prices to USD 2,077/mt, with prices finally closing at USD 2,063.8/mt, up USD 46.8/mt. The China Federation of Logistics & Purchasing (CFLP) announced Sunday that China's purchasing managers' index (PMI) rose to 50.3% in December following drops for two consecutive months, higher than Reuter's median forecast of 49.1%, and up 1.3% from the November level, suggesting a slight expansion in China's factory sector. As a result, LME prices moved higher after a high open on Tuesday. In the evening, the US announced its manufacturing sector grew at the fastest pace in December since June, an indication of good economic momentum for 2012, which heightened market sentiment and helped US and European stock markets rise by 1.5%. In yesterday's trading session aluminium has touched the low of 107.2 after opening at 107.2, and finally settled at 109.1. For today's session market is looking to take support at 107.7, a break below could see a test of 106.3 and where as resistance is now likely to be seen at 110, a move above could see prices testing 110.9.

Trading Ideas:

Aluminium trading range is 106.3-110.9.

Aluminium jumped by 1.74% supported by better-than-expected Purchasing Managers' Index.

China's purchasing managers' index (PMI) rose to 50.3% in December following drops for two consecutive months.

Chinese stock markets will move higher and try to stand stably at 2,200 points owing to rising US stock markets