Tokyo rubber dips to 2-week low but finds support
[2008-4-14]
Tokyo rubber futures fell to a two-week low on Monday as weakness in other commodities and strength in the yen put pressure on prices, but they regained some support on bargain-hunting by investment funds.
The benchmark September rubber contract on Tokyo Commodity Exchange <0#JRU:> fell as far as 278.0 yen per kg -- the lowest since March 31.
By 0142 GMT, September TOCOM rubber was trading at 278.1 yen, down 3.9 yen or 1.4 percent from Friday's close of 282.0 yen.
"Rubber was weighed down by the general strength in the yen and the weakness in other commodities, but follow-through sales were limited after finding some support below 280 yen," said Jun Nishimuta, analyst at Kanetsu Asset Management in Tokyo.
"The market is expected to trade around 280 yen for a while."
Rubber was blocked by a series of technical resistance lines, including the five-day moving average of 282.9 yen and the 10-day average of 285.2 yen.
Key support was seen around this year's low of 266.1 yen reached on March 21. Rubber was also expected to be supported at the 200-day moving average of 276.7 yen.
Falls in other yen-based commodities such as TOCOM gold <0#JAU:>, which was down about 1.5 percent, and weakness in the Nikkei average .N225 undermined sentiment for rubber. Market activity was expected to be thin due to the New Year holidays in Thailand, the world's biggest rubber producer.
Yet firm physical rubber prices were expected to provide support to TOCOM rubber as farmers in key producing countries halted tapping during the dry season when rubber trees stop producing latex, traders said. (Reporting by Chikafumi Hodo; Editing by Hugh Lawson)
The benchmark September rubber contract on Tokyo Commodity Exchange <0#JRU:> fell as far as 278.0 yen per kg -- the lowest since March 31.
By 0142 GMT, September TOCOM rubber was trading at 278.1 yen, down 3.9 yen or 1.4 percent from Friday's close of 282.0 yen.
"Rubber was weighed down by the general strength in the yen and the weakness in other commodities, but follow-through sales were limited after finding some support below 280 yen," said Jun Nishimuta, analyst at Kanetsu Asset Management in Tokyo.
"The market is expected to trade around 280 yen for a while."
Rubber was blocked by a series of technical resistance lines, including the five-day moving average of 282.9 yen and the 10-day average of 285.2 yen.
Key support was seen around this year's low of 266.1 yen reached on March 21. Rubber was also expected to be supported at the 200-day moving average of 276.7 yen.
Falls in other yen-based commodities such as TOCOM gold <0#JAU:>, which was down about 1.5 percent, and weakness in the Nikkei average .N225 undermined sentiment for rubber. Market activity was expected to be thin due to the New Year holidays in Thailand, the world's biggest rubber producer.
Yet firm physical rubber prices were expected to provide support to TOCOM rubber as farmers in key producing countries halted tapping during the dry season when rubber trees stop producing latex, traders said. (Reporting by Chikafumi Hodo; Editing by Hugh Lawson)
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