Aluminium settled -0.62% down at 104.15 as pressure seen after the report, according to the US Department of Commerce, the US retail sales were up 1.1% MoM, beating forecasts and pushing up the US dollar index. However, risk aversion remained due to the slowing Chinese economy and the euro zone crisis. The better than expected US retail sales will curb appetite for the US dollar as a safe heaven, thus supporting aluminum prices. Base metal prices largely closed with losses overnight, as decline in China’s core economic data triggered market concern over China’s economic outlook. The sharp decline of China’s CPI suggested eased inflationary pressure. However, China’s central bank may not likely adopt further loose monetary policy for concern over imported inflation and possibility of CPI rebound. China's PPI was down 3.6% YoY, the lowest in 35 months, suggesting decline in industrial profitability, which weighed on industrial products. In the US, the positive retail sales data helped boost base metals. Investors shifted their focus to e EU summit, which will shed signals to guide base metal price movement. In yesterday's trading session aluminium has touched the low of 103.7 after opening at 105, and finally settled at 104.15. For today's session market is looking to take support at 103.6, a break below could see a test of 103 and where as resistance is now likely to be seen at 104.9, a move above could see prices testing 105.6.

Trading Ideas:

Aluminium trading range for the day is 102.98-105.58.

Aluminium dropped as dollar index rose after US retail sales were up 1.1% MoM, beating forecasts

Risk aversion remained due to the slowing Chinese economy and the euro zone crisis.

Coupled with rebounding home prices, there remains limited room for the Chinese government to relax monetary measures