NCDEX Turmeric under short covering

Technically Turmeric market is under short covering as market has witnessed drop in open interest by 3.15% to settled at 11375 while prices up 78 rupees.

Now NCDEX Turmeric is getting support at 6168 and below same could see a test of 6098 level, And resistance is now likely to be seen at 6292, a move above could see prices testing 6346.

Turmeric on NCDEX settled up by 1.27% at 6238 on short covering amid unfavorable weather conditions in few growing regions that may affect the crop production in an adverse manner. Prices also seen supported on the back of concerns that drought conditions and cold weather will affect the crop production.

However, upside seen limited on higher supplies prospects from new season crop. There is expectation of higher production this season due to higher acreage in Telangana. There are concerns that drought conditions and cold weather will adversely affect the production.

Production is forecasted at 11.5 lakh tonnes in the 1st advance estimates by the government little higher then to last year production. Fresh arrivals are expected to increase at the spot market and will remain peak due to the harvesting activities.

Crop prospects have improved in Maharashtra and overall output is expected to be higher. Demand for turmeric is sluggish in physical as traders are not interested in old crop produce and are awaiting the commencement of new crop supplies, which are likely to hit markets soon.

There are yield concerns from few growing regions as drought conditions and cold weather has not supported the crop; however overall crop in the season will be higher due to increased area. Turmeric production is expected to be higher this season due to higher acreage in Telangana.  In Nizamabad, a major spot market in AP, the price ended at 6250 Rupees dropped 42.5 Rupees.

Trading Ideas:
–Turmeric trading range for the day is 6098-6346.
–Turmeric gained on short covering amid unfavorable weather conditions in few growing regions that may affect the crop production in an adverse manner.
–However, upside seen limited on higher supplies prospects from new season crop.
–Production is forecasted at 11.5 lakh tonnes in the 1st advance estimates by the government little higher then to last year production.
–In Nizamabad, a major spot market in AP, the price ended at 6250 Rupees dropped 42.5 Rupees.

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