Technically market is under long liquidation as market has witnessed drop in open interest by 5.5% to settled at 17370 while prices down 46 rupees.

Now NCDEX Chana is getting support at 4883 and below same could see a test of 4844 levels, and resistance is now likely to be seen at 4983, a move above could see prices testing 5044.

Chana yesterday settled down by 0.93% at 4921 on profit booking after prices rallied amidst weak availability and declining supplies from Nafed. The rise in prices are being helped by the mills to meet the immediate requirements.

Due to cheaper prices and easy availability, the demand for kabuli chana was more than the demand of white peas. With the economy coming out of lockdown, consumption is likely to increase and prices are also rising due to festive season demand.

Arrival of dollar chana in mandis across Madhya Pradesh today was recorded at 7,000 bags against 1,500 bags in Indore mandis. A gradual improvement in demand with easing of lockdown norms will boost the demand for pulses going ahead, especially in view of the onset of the long festival season.

The conflation of a recovery in bulk demand with a smaller crop in the 2019-20 (Jul-Jun) rabi season is also likely to contribute to the rise in prices. India’s kabuli chana production is seen at 273,000 tn, against 395,000 tn the previous year.

The government has set the minimum support price for the 2019-20 rabi chana at 4,875 rupees per 100 kg, 200 rupees higher than the previous year. Production of chana is pegged at 10.2 mln tn in 2019-20, against 9.9 mln tn produced last year.

Trading Ideas:
–Chana trading range for the day is 4844-5044.
–Chana dropped on profit booking after prices rallied ¬†amidst weak availability and declining supplies from Nafed.
–The rise in prices are being helped by the mills to meet the immediate requirements
–With the economy coming out of lockdown, consumption is likely to increase and prices are also rising due to festive season demand.
–In Delhi spot market, chana remains unchanged at by 0 Rupees to end at 4912.8 Rupees per 100 kgs.