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Aluminium Witness May Trade Down, Selling Recommended

ByCommodityOnline
Published 03/14/2014, 06:21 AM
Updated 05/14/2017, 06:45 AM



--In yesterday’s report, we suggested range bound view on the prices as there were no major developments in the market. However, by end of the day, aluminum’s 3 month forward prices at the LME traded down and settled at $1741, down by 1.28%. Likewise, March futures at the domestic market settled at Rs 104.95, down by 0.99%. Although there was no development in the market, the weakening Chinese data and the fall in equities pulled the commodities lower. So, we believe the commodity may main lower today.

--This morning at the LME, aluminum is seen trading at $1740, up by a mere $7 from its previous close. However, we do not intend to change our view and recommend selling from the higher levels. As stated in our previous report, the aluminum premium between the cash and forwards has declined, indicating the same for spot demand. Therefore, prices may trade down in the near-term and recommend selling from the higher levels. At the domestic market for the March futures, the commodity is expected to trade lower. However, we suggest selling from the higher levels due to currency depreciation. The PVOI study suggests that the price fall has been supported by higher volumes and open interest, indicating that the commodity to may trade down today. So, we recommend selling the metal from the higher levels for the day.

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