Commodity Trading Tips for Zinc by Kedia Commodity

Ajay Kumar Kedia 6 August 2013

zinc Zinc yesterday settled up 0.13% at 113.30 traded in a tight price band ahead of the release of China's July CPI and PPI. Yesterday Euro zone June retail sales was -0.5%, the largest decline since December 2012. US ISM July non-manufacturing index was 56.0, topping expectations, which drove up the US dollar index and pushed down LME zinc prices to dip to USD 1,851.3/mt before rising, finally closing at USD 1,869.5/mt, up USD 2.0/mt or 0.11%. While the US ISM non-manufacturing PMI rose to 56 in July, driven by a significant increase in new orders. Manufacturing PMI released earlier was also positive, offsetting negative effect from disappointing non-farm payrolls. However, Fisher, President of the Federal Reserve Bank of Dallas, said the US Federal Reserve is nearer to winding down QE3 and appealed the Fed to taper off QE3 from this autumn, forcing base metals to give back gains. PMI in the UK, France, Italy and euro zone all capped forecasts. Germany's PMI, though missing expectations, did stay above 50. Upbeat figures suggest Europe will get rid of debt crisis soon. HSBC's China services PMI for July was consistent with forecasts. However, HSBC's July China manufacturing PMI fell, in divergence with China official manufacturing PMI. This turned investor attention to China's foreign trade data due Thursday and industrial value-added in July to be announced Friday. Investors will remain worried over metal demand in China ahead of the release of key economic indicators. Technically market is under fresh buying as market has witnessed gain in open interest by 0.31% to settled at 3255 while prices up 0.15 rupee, now Zinc is getting support at 112.40 and below same could see a test of 111.60 level, And resistance is now likely to be seen at 113.70, a move above could see prices testing 114.20.