NMCE rubber plunges on extended selling

NMCE rubber futures traded down on active selling on Tuesday. Futures started the day on positive note on active buying spot market activity also supported the upside. TOCOM futures also fell drastically on profit booking after rising as high as ¥522.50 per Kg. and settled at ¥ 508.10 per Kg.
Falling crude oil prices on Egyptian issue further added to the down side. However, Chinese inflation data came out positive for prices which limited the sharp losses.
The rubbers futures are projected to trade slightly lower initially today on negative cues from TOCOM futures. TOCOM rubber July futures are also trading lower at ¥ 512.10 per Kg. on continued profit booking.
However good domestic demand might reverse the trend towards positive side and futures might trade positive on fresh buying later in the day. Emerging demand from tyre industry is also supporting the prices at domestic spot market. Thus on cues from above stated factors NMCE rubber futures are projected to trade higher today.
Factors to Watch For
Natural-rubber inventories monitored by the Shanghai Futures Exchange is reported around at 58,058 tons, which is down by 62 % from last year’s highest inventory levels of 151,832 tons
According to Rubber Research Institute of Thailand, The physical price of natural rubber in Thailand, the world’s largest exporter, extended gains to an all-time high of 195.80 baht ($6.38) per kilogram yesterday
According to the Association of Natural Rubber Producing Countries, Natural-rubber consumption in China and India may rise 9 percent to 3.6 million tons this year and 5.2 percent to 991,000 tons respectively
Chinese rubber imports have come down by 14% to 150,000 tons due to prevailing higher prices in international market
According to Passenger Car Association, Passenger-car sales in China in January rose 15.3 percent from a year earlier to 1.4 million units on Feb. 14
DERIVATIVE ANALYSIS
Indian Futures (NMCE)
The NMCE February contract, prices, volumes and open interest all are falling. If the total open interest is falling off and prices are declining, the price decline is being caused by disgruntled long position holders being forced to liquidate their positions.
Japan Futures (TOCOM)
The TOCOM active June contract, prices, volumes and open interest all are rising. Market is attracting larger numbers of traders willing to open positions from the long side and hold them. Traders are more confident that prices will continue to climb in favor of a working long. This scenario is good clues that uptrend are secure & that the trend may continue further for a period of time.
Shanghai Futures (SHFE)
The SHFE active June contract, prices and volumes are falling while open interest is rising. It is a good indication that a sharp rally against downtrend will develop creating a sell point for downtrend.

(Source: http://www.commodityonline.com/futures-trading/technical/NMCE-rubber-plunges-on-extended-selling-21965.html)