Nickel on MCX settled down -4.5% at 678.90 as selling triggered by a higher dollar and sentiments remain weak for prices which hit a two-week low on expectations the Philippines may soften mine closure plans. ShFE nickel ended Wednesday's session down 3.3 percent. Nickel prices to ease over a three-to-nine month horizon, as Indonesia resumes exports and as major nickel mines in the Philippines, the world's top exporter, manage to maintain production.
Although environmental policies in the Philippines have threatened the closure of up to 20 nickel mines, market remain confident that there will not be any significant output declines in the Philippines in 2017 compared to 2016 as most major miners will avoid the regulatory crackdown. Philippine President Rodrigo Duterte said on Tuesday he hopes there will be a "happy compromise" between the mining industry and protecting the environment. While today prices can see technical bounce after upbeat Chinese trade data eclipsed an overall drop in the country's imports of refined metal.
China unexpectedly posted a rare trade deficit in February as imports surged far more than expected to feed a months-long construction boom. Also trader are eyeing on growing expectations the U.S. Federal Reserve will hike rates next week have boosted the U.S. currency, which when it rises makes dollar-denominated metals more expensive for holders of other currencies, which could mean weaker demand.
Technically market is under fresh selling as market has witnessed gain in open interest by 48.93% to settled at 23985 while prices down -32 rupees, now Nickel is getting support at 665.9 and below same could see a test of 652.9 level, And resistance is now likely to be seen at 702.6, a move above could see prices testing 726.3.