Fresh selling seen in Aluminium, open interest up 18.38%

Aluminium settled down -0.43% at 116.85 as pressure seen amid signs of an economic slowdown in China, the world’s largest metals consumer. The final reading this month for the manufacturing Purchasing Managers’ Index for China from HSBC Holdings Plc and Markit Economics came in at 49.6, the lowest in seven months.

A figure below 50 signifies contraction. China is on course for the slowest year of economic growth since 1990, according to a survey. Prices seen under pressuree this year amid prospects for fading demand from the Asian nation. Warehouses registered by the LME will raise average rental rates for aluminium by 3.6 percent in 2015, more than double the increase for the previous year, partly offsetting the impact of falling load-out queues. The S&P/CS index of 20 large cities in the US rose 4.5% YoY in October, a bigger increase than 4.4% expected. US December Conference Board’s Consumer Confidence Index was reported at 92.6, lower than 93.9 expected, but higher than November’s reading.

Thomson Reuters data show that bond issuance from emerging market borrowers totaled some USD 480 billion in 2014. China was the biggest source of hard currency issuance in 2014, making up USD 101 billion of bonds. Last week Aluminum was reluctant to move, hovering around $1,900, as the holiday season lost its participants, and rising oil prices made investors concerned whether the production will be increased. Technically market is under fresh selling as market has witnessed gain in open interest by 18.38% to settled at 2712, now Aluminium is getting support at 116.2 and below same could see a test of 115.4 level, and resistance is now likely to be seen at 118.1, a move above could see prices testing 119.2.

Trading Ideas:
--Aluminium trading range for the day is 115.4-119.2.
--Aluminium settled down -0.43% as pressure seen amid signs of an economic slowdown in China
--The final reading this month for the manufacturing PMI for China from HSBC Holdings Plc and --Markit Economics came in at 49.6.
--Aluminium daily stocks at Shanghai exchange came down by 1399 tonnes.

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