Aluminium yesterday traded with the positive node and settled 0.09% up at 106.9 tracking LME aluminum hit a low of USD 2,050/mt overnight as risk aversion investors moved to the safer dollar following release of weak manufacturing data from both China and Europe. The light metal recovered a little bit at the tail of trading after US dollar retreated, settling USD 16.3/mt or 0.78% lower at USD 2,062/mt. The market sentiment will remain slightly bearish due to sluggishness in global economies. LME aluminum is expected to test support at USD 2,050/mt and move between USD 2,050-2,080/mt. Appetite for growth-linked assets weakened after Markit said that its preliminary euro zone manufacturing PMI fell by 1.7 points to a seasonally adjusted 46.0 in April from a final reading of 47.7 in March. It was the lowest level since June 2009. The report came after Markit said that its German manufacturing purchasing managers’ index declined to a seasonally adjusted 46.3 from a final reading of 48.4 in March. Reduced levels of output, new orders and employment meant that the headline German manufacturing PMI fell to its lowest since July 2009. The data came after a report showing that Chinese manufacturing activity remained in contraction territory in April for the sixth consecutive month, fuelling concerns over a slowdown in the world’s second largest economy. For today's session market is looking to take support at 106.5, a break below could see a test of 106.1 and where as resistance is now likely to be seen at 107.1, a move above could see prices testing 107.3.

Trading Ideas:

Aluminium trading range for the day is 106.13-107.33.

Aluminium settled 0.09% up tracking LME aluminum as risk aversion investors moved to the safer dollar

The market sentiment will remain slightly bearish due to sluggishness in global economies

Aluminium daily stocks at Shanghai exchange came down by 5527 tonnes