Zinc yesterday traded with the positive node and settled 0.39% up at 103.75 as market taken clues from china released CPI for June eased to 2.2%, opening more room for China to adjust its monetary policy, with prices moving between 103-104. The Eurozone finance ministers' meeting, to discuss support for Spanish banks and using the bloc's rescue funds to stabilize bond markets, failed to boost the market. The yield of Spanish 10-year bonds rose to the danger level of 7%, denting the zinc market. Later, the US Federal Reserve Board announced the consumer credit expanded in May by the most in five months, better than market expectations, helping support LME zinc prices back to $1856/mt. The easing of inflation pressures in China has increased market expectations over more stimulus policies in the world's largest metal consumer. LME zinc prices are expected to advance, with prices between $1850-1,870/mt. Investors are cautious now after being hit recently by weak economic data. In yesterday's trading session zinc has touched the low of 103.2 after opening at 103.5, and finally settled at 103.75. For today's session market is looking to take support at 103.3, a break below could see a test of 102.8 and where as resistance is now likely to be seen at 104.1, a move above could see prices testing 104.5.

Trading Ideas:

Zinc trading range for the day is 102.82-104.52.

Zinc gained as the easing of inflation pressures in China has increased market expectations over more stimulus policies

China's June CPI rose 2.2% showing the slowest growth in 29 months, while the PPI was down 2.1% YoY,

The yield of Spanish 10-year bonds rose to the danger level of 7%, denting the zinc market.