Gold Silver Reports — Technically Zinc market is under long liquidation as market has witnessed drop in open interest by 6.9% to settle at 8020.
MCX Zinc is getting support key 197 and below same could see a test of 195 level, And resistance is now likely to be seen at 203, a move above could see prices testing 207.
Zinc on MCX settled down -0.27% at 200.25 dropped on profit booking while earlier in the session prices rose to its highest price in a decade as investors ploughed into metals used by China’s steel sector, seeing robust demand even as capacity is constrained by Beijing’s drive for industry reform.
Yesterday LME zinc hit the highest since October 2007 at $3,180.50 a tonne. Zinc prices were also driven by rising expectations of increase in the Chinese infrastructure spending, as stocks at Chinese ports fall for a fourth week.
Meanwhile the International Lead and Zinc Study Group (ILZSG) said the zinc market registered a deficit of 203,000 tonnes in the first half of the year and that total stocks at the end of June stood at 1.16 million tonnes, down from 1.355 million tonnes at the end of March.
Also the average of forecasts in a recent Reuters survey predicted a zinc market deficit of 412,000 tonnes this year. While Zinc price support is seen at $2,900 — an area of congestion this year. The first upside barrier is at a Fibonacci retracement level of $3,200.
In the week ahead, investors will be looking ahead to speeches by central bankers at the Fed’s annual central bank symposium in Jackson Hole, Wyoming. Investors will also be watching U.S. data on housing and durable goods to gauge how it will impact on Fed policy, while the euro zone is to release data on private sector activity.
