Nickel On MCX Settled Down -0.02%

Nickel on MCX settled down -0.02% at 584.70 prices were traded in the range as traders in China, the United States and Britain was absent for national holidays on Monday. Overall sentiments remain weak after trade data last week showed that the Philippines is ramping up ore exports to China, fuelling oversupply concerns. Nickel’s weakness is understandable given the boost supply has been given from Indonesia and the Philippines in recent months.

While traders are still hoping for gains as earlier this month nickel surged on the back of a sustained crackdown in China's polluting steel industry, which fuelled worries about steel supply and lifted the prices of its raw materials. China's Tangshan city launched a campaign to improve air quality last week, saying steel mills in the country's top producing region that fail to meet emission standards face suspension and heavy fines.

But now sentiments are weak as Goldman Sachs says lowers its 3/6/12-month nickel price forecasts by 28 percent/18 percent/18 percent with conciliatory comments from the new mining minister in top ore producer the Philippines adding to the risks of the market being pushed into oversupply. Also this month Chinese customs data shows the gyrations in the nickel market, with imports of ores and concentrates down 11 percent in the first quarter from the same period last year to 3.03 million tonnes.

Imports from the Philippines slumped 20 percent to 2.32 million tonnes, accelerating from the 11-percent drop for 2016 as a whole. Now technically market is getting support at 580.2 and below same could see a test of 575.6 level, And resistance is now likely to be seen at 587.7, a move above could see prices testing 590.6.

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Suhani Verma

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