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Gold

Gold yesterday settled down by -1.02% at 47434 as the dollar and bond yields firmed with expectations that U.S. interest rates will rise next year, shored up by the renomination of Federal Reserve Chairman Jerome Powell. The dollar index hit a fresh 16-month peak and U.S. Treasury yields firmed after Powell was nominated for a second term, adding to confidence that the U.S. central bank will lift interest rates in 2022. Investors are betting that newly renominated Fed Chairman Jerome Powell will need to step up the pace at which the central bank is normalizing monetary policy to better grapple with surging consumer prices. Vice Chair of the FOMC Richard Clarida said that it "may very well be appropriate" to discuss accelerating the pace at which the Fed is winding down its bond-buying programme at the December policy meeting. Speaking at the San Francisco Fed's 2021 Asia Economic Policy Conference, he added that there are upside risks to inflation, that the economy is in a very strong position at that it looks as though Q4 is going to be very good. Federal Reserve Board of Governors member Christopher Waller suggested that if the bank was to double the pace of its QE taper (to $30B per month), then the taper could conclude by the start of April. Technically market is under long liquidation as market has witnessed drop in open interest by -7.48% to settled at 4785 while prices down -489 rupees, now Gold is getting support at 47187 and below same could see a test of 46939 levels, and resistance is now likely to be seen at 47857, a move above could see prices testing 48279.

Trading Ideas:

* Gold trading range for the day is 46939-48279.

* Gold dropped as dollar, yields firm on rate hike bets

* Jerome Powell renominated as Fed chair

* Market expectations for 2022 rate hike reinforced

Silver

Silver yesterday settled down by -3.19% at 62509 as bond yields continued to rise and the dollar rose after Jerome Powell was re-nominated for another term as chair of Federal Reserve. Powell has been supportive of taking action to help fight soaring inflation. His nomination provided a little bit more legitimacy to market pricing in terms of policy tightening next year. Traders also ramped up their bets on an ECB rate hike next year after ECB policymaker Francois Villeroy de Galhau, said on Monday that the central bank is "serious" about ending its emergency bond-buying program in March and may not need to expand regular asset purchases to cover the shortfall. U.S. business activity slowed moderately in November amid labor shortages and raw material delays, contributing to prices continuing to soar halfway through the fourth quarter. Data firm IHS Markit said its flash U.S. Composite PMI Output Index, which tracks the manufacturing and services sectors, fell to a reading of 56.5 in mid-November from 57.6 in October. Euro zone business growth unexpectedly accelerated this month but another wave of coronavirus infections and new restrictions, alongside price pressures, are likely to put a dent in December's expansion, a survey showed. IHS Markit's Flash Composite Purchasing Managers' Index, a good indicator of overall economic health, jumped to 55.8 in November from 54.2 in October. Technically market is under long liquidation as market has witnessed drop in open interest by -2.66% to settled at 6964 while prices down -2062 rupees, now Silver is getting support at 61591 and below same could see a test of 60672 levels, and resistance is now likely to be seen at 64064, a move above could see prices testing 65618.

Trading Ideas:

* Silver trading range for the day is 60672-65618.

* Silver dropped as bond yields and the dollar rose after Jerome Powell was re-nominated for another term as chair of Fed.

* Powell has been supportive of taking action to help fight soaring inflation.

* U.S. business activity slowed moderately in November amid labor shortages and raw material delays

Crude oil

Crude oil yesterday settled up by 3.03% at 5883 after a move by the United States and other consumer nations to release tens of millions of barrels of oil from reserves to try to cool the market fell short of some expectations. The U.S. strategic reserves release was made in concert with other such moves by China, India, South Korea, Japan and Britain, the White House said, as major consumer nations battle against rising inflation. Kazakhstan produced 1.599 mln barrels of oil per day in October, exceeding the quota assigned to it under the global OPEC and non-OPEC producers' agreement, the Central Asian nation's energy ministry said. The country's quota is 1.524 million barrels per day, the ministry said, adding that Kazakhstan's overall compliance rate since May 2020 was 95%. The Kremlin said that Russia remained committed to fulfilling its OPEC+ obligations and that President Vladimir Putin had no plans to contact OPEC+ partners despite talk of key consumer countries releasing their strategic oil reserves. The United States is expected to announce a loan of crude oil from its emergency stockpile on Tuesday as part of a plan it hashed out with major Asian energy consumers to lower energy prices, a Biden administration source familiar with the situation said. Technically market is under short covering as market has witnessed drop in open interest by -30.64% to settled at 3794 while prices up 173 rupees, now Crude oil is getting support at 5709 and below same could see a test of 5535 levels, and resistance is now likely to be seen at 5977, a move above could see prices testing 6071.

Trading Ideas:

* Crude oil trading range for the day is 5535-6071.

* Crude oil rose after a move by US and other consumer nations to release tens of millions of barrels of oil from reserves to try to cool the market.

* Kazakhstan produces 1.6 mln bpd in Oct, above OPEC+ quota

* Kremlin committed to OPEC+ pledges, no plans to discuss oil – stock release with group


Nat.Gas

Nat.Gas yesterday settled up by 5.03% at 375.6 as soaring global gas prices keep demand for U.S. liquefied natural gas (LNG) exports near record highs. Gas prices in Europe soared about 6% on Tuesday as colder weather increased demand and the market remained nervous about winter supplies from Russia. High temperatures in Boston, the biggest city in New England, were only expected to reach about 43 degrees Fahrenheit (6 Celsius) on Tuesday and Wednesday, according to meteorologists at AccuWeather. Data provider Refinitiv said output in the U.S. Lower 48 states averaged 96.1 billion cubic feet per day (bcfd) so far in November, up from 94.1 bcfd in October and a monthly record of 95.4 bcfd in November 2019. Refinitiv projected average U.S. gas demand, including exports, would rise from 111.2 bcfd this week to 112.6 bcfd next week as the weather turns seasonally colder and homes and businesses crank up their heaters. The forecast for next week, however, was lower than Refinitiv's forecast on Monday. The amount of gas flowing to U.S. LNG export plants has averaged 11.2 bcfd so far in November, up from 10.5 bcfd in October as the sixth train at Cheniere Energy Inc's Sabine Pass plant in Louisiana started producing LNG in test mode. Technically market is under short covering as market has witnessed drop in open interest by -41.46% to settled at 1059 while prices up 18 rupees, now Natural gas is getting support at 360.6 and below same could see a test of 345.5 levels, and resistance is now likely to be seen at 384.7, a move above could see prices testing 393.7.

Trading Ideas:

* Natural gas trading range for the day is 345.5-393.7.

* Natural gas jumped as soaring global gas prices keep demand for U.S. liquefied natural gas (LNG) exports near record highs.

* Gas prices in Europe soared about 6% as colder weather increased demand and the market remained nervous about winter supplies from Russia.

* EIA said utilities added 26 billion cubic feet (bcf) of gas into storage during the week ended Nov. 12. U.S.



Copper

Copper yesterday settled up by 0.32% at 740.8 buoyed by dwindling inventories in the LME and prospects of higher demand amid signs of an improvement in China’s real estate sector following regulators’ measures to ease pressure on property developers. However, upside seen limited after U.S. Federal Reserve Chair Jerome Powell was nominated for a second term, reinforcing investor expectations for higher interest rates in 2022. On-warrant copper stocks in LME-registered warehouses have climbed to 62,775 tonnes compared to 23,300 tonnes a month ago. But inventories on the LME are still down about 18% so far this year and are at near historically low levels. The replenished stocks have dragged down the premium of LME cash over the three-month contract price to $118 per tonne versus a record of $1,103.50 last month. The scale of deliveries made by Chinese smelters have been less than anticipated given the backwardation over the last few months. The global world refined copper market showed a 52,000 tonnes surplus in August, compared with a 39,000 tonnes deficit in July, the International Copper Study Group (ICSG) said in its latest monthly bulletin. For the first 8 months of the year, the market was in a 107,000 tonnes deficit compared with a 97,000 tonnes deficit in the same period a year earlier, the ICSG said. World refined copper output in August was 2.09 million tonnes, while consumption was 2.04 million tonnes. Technically market is under fresh buying as market has witnessed gain in open interest by 17.74% to settled at 4493 while prices up 2.35 rupees, now Copper is getting support at 736 and below same could see a test of 731.2 levels, and resistance is now likely to be seen at 745.6, a move above could see prices testing 750.4.

Trading Ideas:

* Copper trading range for the day is 731.2-750.4.

* Copper gains buoyed by dwindling inventories in the LME and prospects of higher demand amid signs of an improvement in demand

* Inventories on the LME are still down about 18% so far this year and are at near historically low levels.

* On-warrant copper stocks in LME-registered warehouses have climbed to 62,775 tonnes compared to 23,300 tonnes a month ago.
 

Zinc

Zinc yesterday settled down by -1.17% at 274.2 as the demand from end-users was less than expected after zinc prices fell and some producers were inclined to reduce the orders from customers with debts approaching the end of this year. Miner and commodity trader Glencore will put its zinc sulphide operation in Portovesme, Italy, on care and maintenance until there is "a meaningful change in power market prices", the company said. The plant, which has capacity of 100,000 tonnes a year, will enter care and maintenance by the end of December at the latest. Global zinc production is estimated at about 14 million tonnes this year, with about half of that expected to come from China, the world's largest producer. The premium of LME cash zinc over the three-month contract rose to $52.80 a tonne, its highest since Oct. 29, indicating tightening nearby supplies as LME inventories of the metal fell to the lowest since July 2020 to 175,025 tonnes. The global zinc market deficit widened to 44,000 tonnes in September from a downwardly revised shortfall of 14,000 tonnes in August, data from the International Lead and Zinc Study Group (ILZSG) showed. Previously, the ILZSG had reported a deficit of 14,900 tonnes in August. During the first nine months of 2021, ILZSG data showed a deficit of 93,000 tonnes versus a surplus of 457,000 tonnes in the same period of 2020. Technically market is under fresh selling as market has witnessed gain in open interest by 8.67% to settled at 1329 while prices down -3.25 rupees, now Zinc is getting support at 272.2 and below same could see a test of 270 levels, and resistance is now likely to be seen at 278.2, a move above could see prices testing 282.

Trading Ideas:

* Zinc trading range for the day is 270-282.

* Zinc dropped as the demand from end-users was less than expected after zinc prices fell

* Glencore's Portovesme zinc operation to enter care and maintenance

* Global zinc production is estimated at about 14 million tonnes this year, with about half of that expected to come from China
 

Nickel

Nickel yesterday settled up by 0.65% at 1554.5 as the pure nickel inventory has been low and dropped continuously, underpinning nickel prices. However, the support was weak amid a comparatively balanced supply and demand pattern. China imported 299,000 mt of NPI and ferronickel in October 2021, a decrease of 2.42% month-on-month but a growth of 10.09% year-on-year, according to customs data. The cumulative imports from January to October were 3.1 million mt. The total Ni content of imported NPI and ferronickel in October stood at 46,000 mt, a decrease of 2.42% month-on-month but an increase of 15.26% year-on-year. The imports of NPI were approximately 250,000 mt in October, a decrease of 2.7% month-on-month. And the imports of ferronickel stood at approximately 49,900 mt, an increased on of 4.51% month-on-month. Customs data showed that China imported 4.476 million mt (denotes both dmt and wmt) of nickel ore in October, down 21.3% month on month and 12.2% year on year. The imports from the Philippines stood at 4.01 million mt, a decrease of 22.8% on the month and 12.63% on the year. The imports from New Caledonia stood at 281,000 mt, a decrease of 3.2% from the previous month. Technically market is under fresh buying as market has witnessed gain in open interest by 43.65% to settled at 1425 while prices up 10.1 rupees, now Nickel is getting support at 1544.9 and below same could see a test of 1535.4 levels, and resistance is now likely to be seen at 1567.2, a move above could see prices testing 1580.

Trading Ideas:

* Nickel trading range for the day is 1535.4-1580.

* Nickel gained as the pure nickel inventory has been low and dropped continuously, underpinning nickel prices.

* China NPI and Ferronickel Imports Dipped 2.42% in October

* Monsoon season in Philippines drove declines in China nickel ore imports in October
 

Aluminium

Aluminium yesterday settled down by -0.4% at 213.95 as the demand remained muted despite supply tightened again. Euro zone business growth unexpectedly accelerated this month as consumers shrugged off another wave of coronavirus infections and new restrictions, while price pressures soared again, a survey showed. After US President Biden nominated Powell as the chairman of the Fed, the US Treasury yields rose simultaneously with the US dollar, and the US dollar index reached a 16-month high. Global primary aluminium output rose to 5.689 million tonnes in October, up 1.2% year on year, data from the International Aluminium Institute (IAI) showed. Estimated Chinese production was 3.270 million tonnes in October, up from 3,250 million tonnes in the same month last year, the IAI said. China's aluminium imports in October rose by 17.4% from the previous month to their highest since July, data from the General Administration of Customs showed. Arrivals of unwrought aluminium and products - which include primary metal and unwrought, alloyed aluminium - totalled 297,043 tonnes last month, up from 252,921 tonnes in September and up 15.8% year-on-year. Imports in the first 10 months of 2021 were up 14.4% from a year earlier at 2.57 million tonnes, on course to set an annual record as restrictions on power usage by domestic smelters keep demand for overseas metal strong. Technically market is under fresh selling as market has witnessed gain in open interest by 23.97% to settled at 1438 while prices down -0.85 rupees, now Aluminium is getting support at 212.7 and below same could see a test of 211.5 levels, and resistance is now likely to be seen at 215.6, a move above could see prices testing 217.3.

Trading Ideas:

* Aluminium trading range for the day is 211.5-217.3.

* Aluminium prices dropped as the demand remained muted despite supply tightened again.

* Global primary aluminium output rose to 5.689 million tonnes in October, up 1.2% year on year

* China's aluminium imports in October rose by 17.4% from the previous month to their highest since July

 

Mentha oil

Mentha oil yesterday settled down by -0.67% at 939 as demand from consumer side is extremely weak and industrial demand is also not picking up. Prices got support in last few weeks as due to crop failure and low recovery of oil, availability of Mentha oil will be low and demand from industries are expected to improve ahead of winter season. Speculation are also high that production this year will be lower as compare with last year because of two important factors. Major physical market player expects demand to sluggish for next few week as cash crunch seen in spot market, while expectations are high about demand improvement ahead of winter season starts. China is one of the biggest buyer for Indian Mentha, no much buying inquiry from China as mainland China and Hong Kong markets were shut. Speculation are also high that production this year will be lower as compare with last year because of two important factors. Firstly damages due to rain in key area and secondly farmers for the last 2 years where sowing mentha but due to not getting much profit at intervals there had been shift to other crops also. In Sambhal spot market, Mentha oil dropped by -45.7 Rupees to end at 1037.8 Rupees per 360 kgs.Technically market is under fresh selling as market has witnessed gain in open interest by 63.44% to settled at 760 while prices down -6.3 rupees, now Mentha oil is getting support at 936.3 and below same could see a test of 933.6 levels, and resistance is now likely to be seen at 943.8, a move above could see prices testing 948.6.

Trading Ideas:

* Mentha oil trading range for the day is 933.6-948.6.

* In Sambhal spot market, Mentha oil dropped  by -45.7 Rupees to end at 1037.8 Rupees per 360 kgs.

* Mentha oil prices dropped as demand from consumer side is extremely weak

* Prices got support in last few weeks as due to crop failure and low recovery of oil

* Availability of Mentha oil will be low and demand from industries are expected to improve ahead of winter season.
 

Soyabean

Soyabean yesterday settled up by 2.16% at 6568 amid soaring demand for soymeal, amid transportation bottlenecks and labour shortages. USDA's November monthly report showed soyabean production in India has grown 8% month-on-month to 11.9 million tonnes. The U.S. Department of Agriculture confirmed private sales of 256,930 tonnes of U.S. soybeans to unknown destinations. The announcement followed rumors this week that China was buying U.S. soybeans. The USDA also reported export sales of U.S. soybeans in the week ended Nov. 4 at 1.289 million tonnes, in line with trade expectations for 950,000 to 1.8 million tonnes. China's October soybean imports from the United States fell sharply from the previous year, customs data showed Sunday, hit by poor demand and limited exports. China brought in 775,331 tonnes of U.S. soybeans in October, down 77% from 3.4 million tonnes a year earlier, according to data released from the General Administration of Customs. Soybean shipments from the United States usually pick up in the fourth quarter of the year when the U.S. harvest gets underway and American beans dominate the market. Poor crush margins and price competitive Brazilian beans, however, have curbed Chinese crushers' appetite for American cargoes. At the Indore spot market in top producer MP, soybean gained 114 Rupees to 6684 Rupees per 100 kgs.Technically market is under short covering as market has witnessed drop in open interest by -15.94% to settled at 63730 while prices up 139 rupees, now Soyabean is getting support at 6418 and below same could see a test of 6269 levels, and resistance is now likely to be seen at 6748, a move above could see prices testing 6929.

Trading Ideas:

* Soyabean trading range for the day is 6269-6929.

* Soyabean gained amid soaring demand for soymeal, amid transportation bottlenecks and labour shortages.

* USDA's November monthly report showed soyabean production in India has grown 8% month-on-month to 11.9 million tonnes.

* China's Oct. soy imports from U.S. slump due to weak demand, hurricane

* At the Indore spot market in top producer MP, soybean gained  114 Rupees to 6684 Rupees per 100 kgs.
 

Soyaoil

Ref.Soyaoil yesterday settled down by -0.43% at 1237.3 on profit booking after reports that global production of the top four vegetable oils – palm, sunflower, soy and rapeseed oils – is likely to rise the highest in four years. The production of the four oils is estimated to rise by 6.3-6.8 mln tonnes in the 2021/2022 crop year altogether, after two years of a global production deficit. The vegetable oil market faces a significant squeeze due to lower output. India slashed its base import tax on crude palm oil, crude soyoil and crude sunflower oil to zero from 2.5%, as the world's biggest vegetable oil buyer tries to cool near-record price rises. The Govt. has decided to impose stock limits on edible oils and oilseeds up to March 31, 2022. This decision has been taken to soften the prices of edible oils in the country and provide relief to consumers. The Ministry said that the stock limits will be decided by the respective state governments depending on local conditions. It has however decided to give exemption to importers and exporters subject to conditions. Oilseeds output is also expected to be down a tad at 23.38 mt as soyabean production was affected by the patchy rains in the key producing States of Gujarat and Madhya Pradesh, respectively. At the Indore spot market in Madhya Pradesh, soyoil was steady at 1260 Rupees per 10 kgs.Technically market is under long liquidation as market has witnessed drop in open interest by -0.6% to settled at 46305 while prices down -5.3 rupees, now Ref.Soya oil is getting support at 1224 and below same could see a test of 1210 levels, and resistance is now likely to be seen at 1258, a move above could see prices testing 1278.

Trading Ideas:

* Ref.Soya oil trading range for the day is 1210-1278.

* Ref soyoil dropped on profit booking after reports that global production of top veg oils to jump most in 4 years

* The production of the four oils is estimated to rise by 6.3-6.8 mln tonnes in the 2021/2022 crop year altogether

* Oilseeds output is also expected to be down a tad at 23.38 mt as soyabean production was affected.

* At the Indore spot market in Madhya Pradesh, soyoil was steady at 1260 Rupees per 10 kgs.

Crude palm Oil

Crude palm Oil yesterday settled down by -0.85% at 1142.9 following an outlook of better vegetable oil production next year. Indonesia's total palm oil exports are expected to fall for a second year by 0.34% in 2021 from a year earlier, the vice chairman of the country's palm oil association said. Indonesia's crude palm oil exports, meanwhile, are expected to plummet by 60.5% this year compared to 2020, vice chairman Togar Sitanggang told. Southern Peninsula Palm Oil Millers' Association's (SPPOMA) production data had cushioned the fall in CPO prices. SPPOMA revealed the Nov 1-20 production data was lower by 2.4%, compared to the same period last month. Global production of the top four vegetable oils – palm, sunflower, soy and rapeseed oils – is likely to rise the highest in four years, up by 6.3 million to 6.8 tonnes in the 2021/2022 crop year altogether. India's palm oil imports in 2020/21 rose 15.2% from a year ago to 8.32 million tonnes, while soyoil imports fell 15% to 2.87 million tonnes, a leading trade body said. The country's vegetable oil imports for the 2020/21 marketing year ended on Oct. 31 stood at 13.53 million tonnes, a tad higher than 13.52 million tonnes a year ago, the Solvent Extractors' Association of India (SEA) said. In spot market, Crude palm oil dropped by -3.7 Rupees to end at 1145.3 Rupees.Technically market is under long liquidation as market has witnessed drop in open interest by -8.78% to settled at 3763 while prices down -9.8 rupees, now CPO is getting support at 1136.3 and below same could see a test of 1129.6 levels, and resistance is now likely to be seen at 1153.5, a move above could see prices testing 1164.

Trading Ideas:

* CPO trading range for the day is 1129.6-1164.

* Crude palm oil dropped following an outlook of better vegetable oil production next year.

* Indonesia 2021 total palm oil exports seen down 0.34%

* India's palm oil imports in 2020/21 rose 15.2% from a year ago to 8.32 million tonnes, while soyoil imports fell 15% to 2.87 million tonnes

* In spot market, Crude palm oil dropped  by -3.7 Rupees to end at 1145.3 Rupees.

Turmeric

Turmeric yesterday settled up by 1.87% at 7838 amid less area in Telangana due to unseasonal rains, also expectations of better export demand supporting the prices. However upside seen limited amid poor demand for old stocks as traders wait for the new season of turmeric. Turmeric exports in the first 5 months (April-August) of FY 2021-22 declined by 25% to 64,600 tonnes as compared to the same period last year, but almost at the same level as the 5-year average. There were also reports of export demand from Europe, Gulf countries and Bangladesh. The areas where turmeric has been sown have received adequate rainfall and are expected to produce well in the next season. Due to favorable weather, production is likely to be higher in 2021-22 (July-June) season. Besides, heavy carryover stocks and slack in bulk demand are keeping prices under pressure. In the first 4 months of FY 2021-22, turmeric exports declined by 26% to 53,000 tonnes as compared to the same period last year, but almost at the same level as the 5-year average. In Nizamabad, a major spot market in AP, the price ended at 7490 Rupees gained 132.85 Rupees.Technically market is under short covering as market has witnessed drop in open interest by -3.46% to settled at 9485 while prices up 144 rupees, now Turmeric is getting support at 7640 and below same could see a test of 7440 levels, and resistance is now likely to be seen at 8090, a move above could see prices testing 8340.

Trading Ideas:

* Turmeric trading range for the day is 7440-8340.

* Turmeric gained amid less area in Telangana due to unseasonal rains, also expectations of better export demand supporting the prices.

* However upside seen limited amid poor demand for old stocks as traders wait for the new season of turmeric.

* Turmeric exports in the first 5 months (April-August) of FY 2021-22 declined by 25% to 64,600 tonnes as compared to the same period last year.

* In Nizamabad, a major spot market in AP, the price ended at 7490 Rupees gained 132.85 Rupees.
 

Jeera

Jeera yesterday settled up by 1.32% at 16475 as domestic demand is now picking up also the export inquiries to support price. However upside seen limited as adequate stock with traders and farmers may keeping prices under pressure at higher levels. Jeera production in Syria and Turkey was limited due to bad weather, which increases demand for Indian cumin. As of now Exports of Jeera for Apr-Aug was down by 12% Y/Y at 1.24 lakh tonnes but expected improve in coming months as Rupee weakness will support exports. During last two months, the prices were higher compared to last year despite sufficient stocks with traders. Sowing can see drop as farmers preferred to have other crop against Jeera. Weather in key sowing area will be crucial in next few months. The export of cumin is increasing continuously and in the coming days there are signs of increasing the export of cumin in a big way. Purchase of cumin seeds from African and Middle East countries will be diverted from other countries to India this year. In Unjha, a key spot market in Gujarat, jeera edged up by 4.35 Rupees to end at 16073.1 Rupees per 100 kg.Technically market is under fresh buying as market has witnessed gain in open interest by 0.21% to settled at 9954 while prices up 215 rupees, now Jeera is getting support at 16280 and below same could see a test of 16085 levels, and resistance is now likely to be seen at 16605, a move above could see prices testing 16735.

Trading Ideas:

* Jeera trading range for the day is 16085-16735.

* Jeera gained as domestic demand is now picking up also the export inquiries to support price.

* However upside seen limited as adequate stock with traders and farmers may keeping prices under pressure at higher levels.

* India's cumin exports will increase due to less supply from Afghanistan-Syrian

* In Unjha, a key spot market in Gujarat, jeera edged up by 4.35 Rupees to end at 16073.1 Rupees per 100 kg.
 

Cotton

Cotton yesterday settled down by -0.68% at 32070 as selling pressure intensified after demand from China eased. However downside seen limited in anticipation of a possible fall in production, and the remaining cotton stock is also low, while import demand from China remains high. China will start a new round of sales from its cotton reserves, with a total 600,000 tonnes of imported and domestic cotton to be sold off in daily auctions, according to an official notice. It is the second batch of cotton to be released from reserves this year and is designed to better meet demand for the fibre from spinning companies. Both production estimates for the 2021/22 crop year and ending stocks in the U.S. were largely unchanged at 18.20 million bales and 3.40 million bales respectively, the USDA said in its November World Agricultural Supply and Demand Estimates (WASDE) report. India’s cotton production in 2021-22 season is likely to be 360.13 lakh bales of 170 kg each (equivalent to 382.64 lakh running bales of 160 kg each), which is more by 7.13 lakh bales than the previous season’s crop of 353 lakh bales, the Cotton Association of India (CAI) has said in its first estimate for the new season beginning October 1, 2021. In spot market, Cotton gained by 150 Rupees to end at 31930 Rupees.Technically market is under fresh selling as market has witnessed gain in open interest by 18.92% to settled at 4029 while prices down -220 rupees, now Cotton is getting support at 31780 and below same could see a test of 31500 levels, and resistance is now likely to be seen at 32300, a move above could see prices testing 32540.

Trading Ideas:

* Cotton trading range for the day is 31500-32540.

* Cotton dropped as selling pressure intensified after demand from China eased.

* However downside seen limited in anticipation of a possible fall in production.

* China will start a new round of sales from its cotton reserves, with a total 600,000 tonnes of imported and domestic cotton to be sold off in daily auctions

* In spot market, Cotton gained  by 150 Rupees to end at 31930 Rupees.

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