COPPER IS LIKELY TO TRADE ON SIDEWAYS DURING MORNING SESSION
Date: 20/3/2012
Copper is likely to trade in sideways during the morning session on Tuesday, 20th March as the lack of global economic cues and s fresh economic data due later during the week might lead the investors to stay on sidelines. Copper is likely to find support at R 430 per kg and R 426 per kg and resistance at R 439.6 per kg and R 442.7 per kg.
Copper eased on Monday, 19th March at LME as the investors were on lull mode mostly traded on sidelines craving for US housing market data which showed a rise in the index but missed the expectations. However, eased concerns about Greece averted the threat of default and euro zone debt crisis woes. This coupled with the floundering dollar led the metal to pare huge losses.
LME Copper tumbles by 0.6% at $8545 per tonne on Monday. Comex Copper buoyed by 0.8% or 3 cents at $3.909 a pound compared to $3.878 a pound traded last day. MCX Copper rose by 0.6% or R 2.65 at R 434.85 per kg. The contract stood above 9-day EMA and RSI stood at 64.5.
The dollar index shed by 0.4% at 79.45 against the basket of 6 major currencies as the mixed economic global cues hampered the safe haven dollar.
Trading conditions in the metal markets were generally quiet during the most of the day tracing lack of cues in the market.
US home builders' confidence in the housing market held steady at 28 in January, at the highest level in nearly five years, as per the National Association of Home Builders. But missed expectation of 30 and December's index was revised from 29 to 28.
In addition, Prime Minister Lucas Papademos affirmed that the debt-laden country is halfway to economic recovery. Also related to Greece, an auction determined that the total payout to settle credit default contracts to insure against a Greek default will pay out around $2.5 billion.
In industrial metal news, Venezuela's state-run aluminium producer Alcasa will use a $403 million loan from China to prop up its operations, which would allow the company to resume exports to several Latin American countries.
Aluminum Corp of China Ltd (Chalco) reported a bigger than expected fourth-quarter net loss of 729.6 million yuan ($115.3 million), showing the impact of lower metal prices and higher costs, and warned of losses in the first quarter of 2012.
Chalco, the country's top aluminum maker, had affirmed in January that 2011 net profit would fall more than 50%, implying a fourth-quarter loss of more than 600 million yuan.
Fitch Ratings affirmed in one of its highlights of a new report that demand and nominal price movements for key commodities are largely correlated with movements in regional and global economic cycles. Commodity price volatility is expected to continue as the Euro zone sovereign debt concerns constrains market confidence in 2012.
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