Turmeric is projected to extend losses in the coming days on the back of strong production. However some buying was seen in the last few days ahead of Holi as traders were trying to complete order with markets being closed on Holi. Average daily arrivals at spot market of Nizamabad and Erode were around 10,000 and 25,000 bags respectively (Each bag=70Kg.). Demand from upcountry buyers ahead of Holi is the only one supporting the factor as of past couple of days. However, supply is exceeding the demand which is pressurizing the prices. As per trade sources, turmeric production in 2011 is estimated around 64 lakh bags against 45-48 lakh bags last year (Each bag=70Kg.) According to derivative analysis, 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 and a bearish condition. |
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