Nickel On MCX Settled Down -3.05% At 604.90

Nickel on MCX settled down -3.05% at 604.90 tracking weakness from LME Nickel which finished 4.5 percent lower at $9,310 after hitting its lowest since June at $9,305. Nickel dropped to its weakest since June as geopolitical worries from sabre-rattling over North Korea to a snap UK general election hurt investor appetite for cyclical assets such as base metals. The base metals have been showing weakness in recent weeks and have so far not seen any pick-up with the shift into the seasonally strong second quarter. The lack of upside momentum in most of the metals since mid-February has increased the chance of stale long liquidation and this remains a risk.

However, the Chinese data out on Monday bodes well and market do generally expect better demand and supply restraints to underpin the fundamentals for most of the metals this year, so prices expect dips to remain well supported. Tuesday was the first opportunity LME traders had to react to China’s report that its economy grew by 6.9% in the first quarter compared to a year earlier. The reading topped expectations for 6.8% growth. Still, nickel was lower on Tuesday. The commodity is finding support at $9,350 and meeting resistance at $10,300. Recently, nickel has been trading sideways with the market in a wait-and-see mode when it comes to the metal’s major price driver – the mining shutdowns in the Philippines.

In absence of fresh news when it comes to the supply chain, macroeconomics and the perceptions over future steel demand are nickel’s major price influencers. Now technically market is getting support at 595.8 and below same could see a test of 586.7 level, And resistance is now likely to be seen at 619.5, a move above could see prices testing 634.1. 
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Suhani Verma

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