Nickel On MCX Settled Up 1.4% - Ways2Capital

Nickel on MCX settled up 1.4% at 602.5 tracking rise in LME nickel closed up 2 percent at $9,360 as dollar weakness cushioned prices, but the outlook was tainted by investors cutting exposure to metals on concerns over China demand concerns. The global refined nickel market swung into a small surplus in March after an increase in production outpaced steady global demand, industry data showed. China investors have cut metals holdings since President Xi Jinping called for increased efforts to ward off systemic risks to help maintain financial security last month.

China's April non-financial outbound direct investment (ODI) fell 71 percent from a year earlier to $5.82 billion. Global nickel market was in a surplus of 3,300 tonnes during the first three months of 2017, according to the World Bureau of Metal Statistics (WBMS). The market saw a shortage of 62,000 tonnes in the whole year of 2016. By the end of March, LME nickel inventories were up by 4,400 tonnes from the level seen in late 2016.

From January to March 2017, global refined nickel production was 391,500 tonnes, compared with consumption of 388,200 tonnes. Nickel ore inventories at seven major Chinese ports grew in the week ending May 12, data showed. Inventories at the seven ports grew after falling two weeks ago, up 70,000 tonnes last week, according to data.

Last week, prices of medium and high-grade nickel ore, both for spot and future delivery, were down, mainly because of falling prices of high-grade NPI and production cuts at domestic NPI producers. Technically market is under short covering as market has witnessed drop in open interest by -3.44% to settled at 35039 while prices up 8.3 rupees, now Nickel is getting support at 593.3 and below same could see a test of 584 level, And resistance is now likely to be seen at 609.9, a move above could see prices testing 617.2.

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Suhani Verma

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