Gold Silver Reports – Technically Zinc MCX market is under long liquidation as market has witnessed drop in open interest by 7% to settle at 9453.
Zinc MCX is getting support at 212 and below same could see a test of 210 levels and resistance is now likely to be seen at 217, a move above could see prices testing 220.
Zinc on MCX settled down 1.27% at 214.1 tracking 1.60 percent weakness in LME prices in profit booking after continued their climb finding support amid tight stock levels.
The market has tightened following supply cutbacks and tougher Chinese curbs on mining. Glencore Plc, the top producer, has curtailed output at mines in Australia and Kazakhstan, and made a further wager on zinc when it announced plans to increase its stake in Peru’s Volcan Cia Minera SAA.
Available stocks of zinc in LME warehouses currently stand at 113,475 tonnes; they have ranged between 69,850 and 317,000 tonnes so far this year. Looking ahead at the October date – October 18 – there are two large short positions with one entity holding 30-39% and another holding 10-19% of the October date open interest, which stands at 19,322 lots, some 483,050 tonnes.
In other news related to the zinc market, China’s crackdown on pollution has prevented over 1,000 zinc mines across the country from ramping up production, stopping miners from cashing in on the metal’s recent price rally.
China’s mined zinc output declined 7.4% or 185,100 tonnes year on year to 2.33 million tonnes in the first half of 2017, according to World Bureau of Metal Statistics. U.S. employment fell in September due to the impact of Hurricanes Harvey and Irma, but the unemployment rate and wage growth suggested an improving labour market.
Prices have experienced little price fluctuation throughout the week, with Chinese market participants sidelined due to an extended national holiday.
