Zinc settled down -2.44% at 127.90 tracking LME zinc prices overnight which opened at $1,975/mt, and then hovered around the 5 and 10-day moving average. Market fears about situations in Syria alleviate, with non-US dollar currencies falling, which supported the US dollar index to rebound, breaking through the 5 and 10-day moving average. As major economic data from Europe and US fell short of expectations, zinc prices were weighed down to $1,954/mt, a new low over the past two weeks, and finally closing at $1,956/mt, down $20/mt or 1.01%. The market still focused on political situations in Syria. UK, France, Canada and League of Arab States advocated US to intervene as the al-Assad government used chemical weapons to attack civilians, and UK has drafted an UN resolution calling for protecting Syrian civilians with necessary measures. But Russia supported the al-Assad government. Market concerns thus increased, with crude oil and gold prices rising. Bank of England President believed UK economy did recover, and emphasized the importance of inflation target, and also reiterated his stance supporting easing policies. As mortgage interest rates rose, US existing home sales in July dropped for the second consecutive month by 1.3%, lower than expectations and June. Technically market is under long liquidation as market has witnessed drop in open interest by -28.66% to settled at 1897 while prices down -3.2 rupee, now Zinc is getting support at 124.1 and below same could see a test of 120.3 level, And resistance is now likely to be seen at 134.3, a move above could see prices testing 140.7.

Trading Ideas:

Zinc trading range for the day is 120.3-140.7.

Zinc dropped as US dollar index to rebounded as market fears about situations in Syria alleviate, with non-US dollar currencies falling

Bank of England President believed UK economy did recover, and emphasized the importance of inflation target

Zinc daily stocks at Shanghai exchange came down by 305 tonnes