NCDEX Jeera under short covering Resistance seen at 13920

Technically Jeera market is under short covering as market has witnessed drop in open interest by 2.56% to settled at 1485 while prices up 130 rupees.

Now NCDEX Jeera is getting support at 13770 and below same could see a test of 13685 levels, and resistance is now likely to be seen at 13920, a move above could see prices testing 13985.

Jeera yesterday settled up by 0.95% at 13855 on likely fall in arrivals in the coming weeks as most farmers are engaged in sowing Kharif crops. Higher production in the current year and slow pace of demand is capping the upside in prices.

Bulk buyers who usually build-up their inventories during the peak harvest season are now buying on demand and need basis due to financial problems and uncertainty due to coronavirus. Demand from the domestic and overseas markets has declined.

It generally remains subdued during monsoon because of higher moisture content in the spice. On the export front, India exported 2.14 lakh tonnes in 2019-20 (April- March) rise of 17% from the same period of last year.

India exported around 0.19 lakh tonnes of Jeera in March 2020 which is 17% lower than March 2019 at 0.23 lakh tonnes. However, in March 2020, Jeera exports reported at 0.19 lakh tonnes, have been 58% higher than 0.12 lakh tonnes recorded in the previous month.

International jeera prices have fallen, hovering in the range of $1,780-1,800 (FOB rates) per tonne, about 35-40 per cent lower than what was quoted in the same period last year.

Trading Ideas:
--Jeera trading range for the day is 13685-13985.
--Jeera gained on likely fall in arrivals in the coming weeks as most farmers are engaged in sowing Kharif crops.
--Higher production in the current year and slow pace of demand is capping the upside in prices.
--Bulk buyers who usually build-up their inventories during the peak harvest season are now buying on demand and need basis.
--In Unjha, a key spot market in Gujarat, jeera edged down by 24 Rupees to end at 13871.45 Rupees per 100 kg.

Courtesy: Kedia Commodities