Nickel On MCX Settled Up 0.58%

Nickel on MCX settled up 0.58% at 575.4 on short covering after remained under pressure amid expectations of weak demand as a seasonal construction slowdown in the summer months looms. Nickel ore inventories at seven major Chinese ports kept increasing in the week. Inventories at the seven ports increased slightly over this past week, up 30,000 tonnes.

This past week, prices of medium and high-grade nickel ore, both for spot and future delivery, extended declines as ore demand from small and medium NPI producers remained weak, despite that high-grade NPI prices were stable, with mainstream price range lower. Jiangsu Delong Nickel Industry is going to restart two 60-tonne AOD refining furnaces at its initial stage of production resumption. The two will produce 50,000-60,000 tonnes of stainless steel per month, and will need 4,000-4,800 tonnes of nickel (Ni content), and about 20,000 tonnes of ferrochrome.

Support can be seen in today’s session as investors reduce risk before the major political and economic events later this week. With British elections, an ECB policy meeting where policymakers may take a less dovish stance, and former FBI director James Comey's Senate testimony on all set for Thursday, investors are wary of taking big positions in markets.

Also Investor optimism about the pace of U.S. interest rate hikes over the longer-term, however, has been pegged back recently, as investors question whether recent economic data has deterred the Federal Reserve from its view that two additional rate hikes this year are appropriate. Technically market is under short covering as market has witnessed drop in open interest by -3.95% to settled at 44913, now Nickel is getting support at 570.2 and below same could see a test of 565 level, And resistance is now likely to be seen at 580.9, a move above could see prices testing 586.4.

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Suhani Verma

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