NMCE Rubber settles down on extended selling

NMCE rubber futures traded highly volatile on Thursday. From opening itself prices started trading down on profit booking at higher levels. TOCOM futures market also extended the bearish trend on active selling and settled at ¥424.90 per Kg.
Thus, on negative cues from TOCOM prices at NMCE platform also traded down. However, domestic spot market continued the positive trend amid tight supply. Positive cues from spot market supported the prices to witness good recovery at lower levels but prices failed to sustain the gains and resumed the down trend again.
The rubbers futures are projected to continue the losses initially on active profit selling on Friday. TOCOM August futures are also trading down at ¥423.00 per Kg. on extended profit selling. However, domestic spot market is reporting good buying which might support the Indian futures to trade higher later in the day.
Factors to Watch For
As per deputy head of the China Rubber Industry Association, Natural-rubber demand in China, the biggest consumer, will rise 8% this year. Consumption will be 3.24 million metric tons, while tire output will climb 7.9 percent to an all-time high of 453 million units
As per the Committee on rubber policy of Thailand Government, Thai government will negotiate with commercial banks to extend loans to exporters to buy rubber from farmers at a minimum price of 120 baht per Kg
According to rubber board of India, Indian February Natural Rubber Output is 54,500 Tons Vs 51,500 Tons, consumption is 79,000 Tons Vs 76,350 Tons and imports are 6,831 Tons Vs 12,278 Tons
As per data released by rubber board, the year end deficit in natural rubber in India is estimated around 1.2 lakh tons and it is expected to be increase to 2 lakh tons during 2011-12
According to the Association of Natural Rubber Producing Countries, Consumption in China, India and Malaysia, representing 48% of global usage, will increase this year
DERIVATIVE ANALYSIS
Indian Futures (NMCE)
The NMCE April contract, prices are falling while volumes and open interest are rising. If prices are in a downtrend and open interest is on the rise, chartists know that new money is coming into the market, showing aggressive new short selling. This scenario will prove out a continuation of a downtrend.
Japan Futures (TOCOM)
The TOCOM active August 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. Technicians view this scenario as a strong position technically because the downtrend will end as all the sellers have sold their positions, creating fresh buying opportunity at lower levels.
Shanghai Futures (SHFE)
The SHFE active July contract, prices are rising while volumes and open interest are falling. Market is running out of traders willing to open or hold an open long/buy. Traders are liquidating both loosing short positions & closing winning long positions. A higher probability the market is set to retrace in price lower at some point.

(Source: http://www.commodityonline.com/futures-trading/technical/NMCE-Rubber-settles-down-on-extended-selling-22959.html)