Nickel
Nickel prices on April 9 declined to settle at Rs 1,254.50 per kg as participants trimmed their position as seen by the open interest. The base metal has risen by Rs 49.9 or 4.15 percent during the current week on the MCX.
The non-ferrous commodity has been trading higher than 5, 20 and 200 days’ moving averages but lower than 50 and 100 days’ moving averages on a daily chart. The Relative Strength Index (RSI) is at 55.90, which indicates bullish momentum in prices.
Nickel price was weighed down by inventory jump at LME-registered warehouses and weak demand in China and other Asian countries.
The demand in western countries has been sluggish in the past due to surging coronavirus cases along with rising bond yields.
The US dollar index ended marginally higher at 92.18, up 0.12 percent on April 9 against the major cross. The dollar index ended with a loss of 0.85 percent during the week.
MCX METLDEX decreased 151 points, or 1.04 percent, to close at 14,380. The index tracks the real-time performance of key base metals.
“Fundamentally for the month ahead, we are expecting LME and MCX Nickel futures to witness uptrend with reports of higher demand from the battery sector in the United States. Recently, President Joe Biden’s vast infrastructure plan of $ 2.3 trillion includes $ 174 billion to boost the market for electric vehicles and billions more for renewable power – both provisions aimed at weaning the US off of fossil fuels and combating climate change, which is estimated to support global nickel prices in the coming weeks,” said Sunand Subramaniam, Senior Research Associate at Choice Broking.
“High spending on the infrastructure sector in India with recovered demand in the automobile sector for e-vehicle is forecast to support prices from the lower levels.” “Overall, we expect a bullish trend for the month ahead and recommend buying in MCX Nickel April futures near Rs 1,258/kg for a target of Rs 1,315/kg and maintaining a stop loss below Rs 1,238/kg on a closing basis”, Subramaniam added.
In the futures market, nickel for April delivery touched an intraday high of Rs 1,272 and a low of Rs 1,247.30 per kg on the MCX. So far in the current series, the base metal has touched a low of Rs 1,154.30 and a high of Rs 1,461.30.
Nickel delivery for April slipped by Rs 16.40, or 1.29 percent, to settle at Rs 1,254.50 per kg with a business turnover of 1,442 lots. The same for May contract slipped by Rs 12.50, or 0.98 percent to Rs 1,258.30 per kg with a turnover of 128 lots.
The value of April and May’s contracts traded on April 9 was Rs 1,325.30 crore and Rs 24.76 crore, respectively.
The industrial metal settled with a loss of 0.68 percent at $ 16,640 per tonne in London.
Next Week Outlook
Kshitij Purohit, Product Manager, Currency & Commodities, CapitalVia Global Research Limited
Strategy: In our anticipation, traders should look for buy-on-dips strategy for MCX Nickel futures. The ideal range to enter in the buy position should be around Rs 1,240-1,242 by keeping a stop loss around Rs 1,234 for the target of Rs 1,280.
Rationale: During the week, MCX Nickel futures has traded in a bullish trend. MCX Nickel has formed an Extended Rectangle pattern in the hourly chart and provided the channel breakout and traded above the psychological resistance of Rs 1,200. The key support level is shifted to Rs 1,227-Rs 1,230 for the next week. We are anticipating a strong bullish run towards the next resistance levels of Rs 1,275 – Rs 1,280 levels.
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