Commodity Trading Tips for Zinc by Kedia Commodity

Zinc on MCX settled down -0.66% at 187.10 amid economic uncertainty with investors exercising caution ahead of a slew of Chinese economic data and U.S. President-elect Donald Trump's inauguration. Talk of supply issues underpinned – Yunnan Chihong announced earlier this week that it will cut some lead and zinc smelting output due to the low treatment charges for concentrate. Treatment charges continue to fall, forcing the closure of smelters in China. Any delay to the restart of 500,000 tpy of capacity that Glencore closed last year could also exacerbate the tightness in zinc and send prices higher. China's average new home prices surged 12.4 percent in 2016, but gains have moderated in recent months. China's corporate debt has climbed to 169 percent of GDP and international institutions have repeatedly urged Beijing to act quickly to tackle the problem in order to avoid a financial crisis. Data showed the economic trend remained largely intact in the last month of the year, with December investment and factory output growth coming in slightly below expectations while retail sales rose more than expected. The central bank could slightly tighten credit conditions this year to encourage debt-laden companies to deleverage, but it's unlikely to rush to raise interest rates despite an expected pick-up in inflation, policy insiders said. Technically market is under long liquidation as market has witnessed drop in open interest by -4.32% to settled at 5844 while prices down -1.25 rupee, now Zinc is getting support at 185.4 and below same could see a test of 183.6 level, And resistance is now likely to be seen at 188.9, a move above could see prices testing 190.6.

Trading Ideas:

Zinc trading range for the day is 183.6-190.6.

Zinc prices dropped with investors exercising caution ahead of a slew of Chinese economic data and U.S. President-elect Donald Trump's inauguration

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